How publishers are planning for the end of the third-party cookie
As they brace for the death of the third-party cookie, publishers are cooking up alternative ways of identifying users to target and serve ads to.
Google’s announcement last week that it plans to terminate the use of third-party cookies in its Chrome browser rankled trade groups like the Association of National Advertisers and the American Association of Advertising Agencies because of the lack of what they considered enough prior warning. Publishers and marketers do not make up the majority of the members of the World Wide Web Consortium, the web standards group that Google has consulted for alternatives. But prior hints that third-party cookies would be phased out across the whole advertising industry has meant that publishers have indeed been exploring alternatives and reducing their reliance on them over the last few years. In December, a dozen U.K. publishers met with the Interactive Advertising Bureau’s Technology Laboratory in an attempt to figure out a solution to the expected impact on ad targeting and real-time bidding within the open marketplace.
One solution now being tested by data management platform provider Permutive is the use of context to map various audience segments on the open marketplace; the segments would be created using publishers’ first-party data. The principle is similar to what Google is proposing with its Federated Learning of Cohorts, which relies on machine learning to study the browsing habits of groups of similar users. (The framework makes up part of Google’s solutions in its Privacy Sandbox to deal with ad targeting in a post-third-party cookie world. Also tackled in the Privacy Sandbox: ways for measurement and fraud prevention to occur in post-cookie environments.)
The publishing and advertising industries would need to agree on the naming of audiences based on a common taxonomy, like what’s found in the IAB Data Transparency Label. (The latter is a standardized labeling system that publishers, vendors and advertisers can use to clarify the quality of data.)
Over the next few months, an IAB Tech Lab working group will pose questions about the proposal and run test campaigns to discern the effectiveness of this method of trading audiences. The goal is to devise a set of industry standards, said Permutive marketing director Amit Kotecha. For it to work, the providers of demand-side platforms and supply-side platforms need to be on board, he said.
One benefit of establishing an industry standard through contextual mapping is that it would be an alternative to using Google’s technology. Google has asked for the advertising and publishing industries’ input. Even so, publishers and advertising industry observers are cautious about Google’s ending up as the ultimate arbiter of how digital advertising will look in the future.
“The general feeling is that [Google Privacy Sandbox proposals] make sense,” said Bedir Aydemir, News UK’s head of audience and data, commercial. “But the concern as usual is that if the industry is dependent on Google creating the solution, then once again they are able to dominate and control an important aspect of the advertising ecosystem.”
Previously, publishers had been concerned that sharing their valuable first-party data could lead to its exploitation by rivals. But this concern about competitors has become less of a problem following the establishment of initiatives like the publisher data alliance known as The Ozone Project, said publisher Stylist’s David Hayter, who heads the publisher’s digital operation and attended the December IAB Tech Lab event.
“Publishers understand that we compete for briefs, but on a macro level we are not really competing with each other but with the platforms,” Hayter said.
Yet the details for the solution are still being hashed out. Hayter said it’s not clear which aspects of publishers’ own first-party data would be viewable by others. “We would need to see whether we start to undervalue our own data by doing that,” he said. “If we see an increase in yield and in fill rate, then that’s great.”
“We stopped using third-party data two years ago; the data we were getting back was massively inaccurate,” Hayter said. “We knew we were better off focusing on our own first-party data piece.”
A new identification solution “has to bring advertisers and publishers back together so that the only place to buy an audience is by going to the publisher,” Kotecha said. “First-party data becomes the new currency and advertisers know where to buy the media at scale across many publishers.”
According to Ryan Pauley, Vox Media’s chief revenue officer, third-party data companies have built a $19 billion industry by inserting themselves between publishers and advertisers; that’s a slice of the advertising industry that publishers won’t benefit from.
The caveat to the whole process of developing a context mapping solution will be encouraging all players to adopt the standard. According to publisher and vendor sources, in principle that would not involve a huge technological leap, but it can work only if demand-side platform providers accept that type of bidding.
“Knowing that third-party data partners won’t exist in about two years’ time, [DSP providers] might start looking into alternative solutions,” said Adriana Tailor, head of data and insight for magazine publisher TI Media. “Third-party data providers represented a nice revenue stream for DSPs. I’m unsure if the new solution will bring any revenue to DSPs.”
Update: An earlier version of this story incorrectly stated third-party data companies built a $19 million industry.
‘More regulatory minded’: ANA’s lobbyist on what advertisers can expect from Biden’s presidency
The ad industry will try to convince legislators that advertising and digital communication are central to economic recovery.
‘Not just the Zoom happy hour’: Why publishers are adding benefits to lift employee peace of mind
Digital publishers have invested in providing employees with more virtual wellness services and career development programs in order to ease staffer stress levels.
Why ethical dilemmas are putting brands and their media buying in the spotlight
As the U.S. presidential inauguration comes to pass, marketers are increasingly aware that what they buy has an impact on society.
SponsoredThe evolution of shoppable content lies in social media streams
With the physical and social aspects of shopping stripped away due to various lockdown restrictions around the globe, shoppable social media is poised to fill the void. In a recent example, Instagram launched its Reels and Shop tab for users to connect with brands and creators — and to discover products. The social media platform will […]
WTF is a SPAC?
An increasing number of companies, including media organizations, are turning to SPACs as a non-traditional means of taking their companies public.
‘Elevate the next generation’: As social platforms begin Black creator programs, critics say they need to do more
As social platforms launch Black creator programs, Black creators say they need to do more in support of diverse creative voices.