Don’t Fear the Cookie Backlash

Adam Lehman is president and chief operating officer of Lotame, a provider of data management services.

Following Mozilla’s announcement that it will block third-party cookies in the next release of Firefox, the ad tech echo chamber has been abuzz with a frenzied mix of indignation, panic, denial and prognostication.

Some hope Mozilla will backtrack on the changes, as it did a few years ago when it floated a proposal, but I believe the train has left the station this time around. That’s the bad news. The good news is this isn’t the end of the world, as many would lead you believe. It’s not like the entire digital media ecosystem is going to pack up its bags, return all those millions to investors, and go look for something better to do.

Even though the Firefox change may reduce the availability of third-party data sources, companies will still be in a position to use their first-party data sources for audience-marketing strategies. Advertisers and publishers have access to growing pools of first-party audience data – from Web, mobile, CRM, point-of-sale and other sources.

Several people have already pointed out that the Mozilla change will create even greater advantages for the largest players in digital media. They’re not wrong. But companies are getting smarter about their data, using tools like data-management platforms, and layering modeling capabilities on top of a DMP in order to provide the same kind of audience enrichment and extension using first-party data that is otherwise achieved through buying third-party data. Smart publishers and marketers are also increasingly turning to “second-party” data sources in order to grow addressable audiences. This is achieved through bilateral and multilateral data co-ops. These second-party relationships can help a publisher or marketer fill key gaps and in a way that conforms to the Firefox protocols.

As it becomes less practical to license and use cookie-based third-party data, publishers, marketers, networks and exchanges will seek out other cookie-less means to extend and target larger audiences for their advertising and marketing campaigns. On the plus side, the increased focus on these cookie-less technologies should expedite the development of privacy standards and tools to govern their use. And this shift could have the added bonus of alleviating the many operational issues with cookie-based data, such as pixel mayhem.

Turning off the Firefox third-party spigot will only represent a 15-20 percent reduction in the available third-party data from Web-based sources. Taking a broader view, as the Firefox door closes, a hundred new doors will be opening (or at least a few new doors with a hundred times the data).

These are all big changes. There will be pain, as there is with any change. But you cannot put the data genie back in the bottle. Our society is literally overflowing with data; and business, government, non-profits and consumers will find ways to tap into these data streams for every imaginable purpose (within the bounds of ever-evolving privacy standards).

Image via Shutterstock

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