When Google first announced in 2020 its intent to phase out the use of third-party cookies in its Chrome browser by 2022, two years seemed like a long time to prepare. However, that final cut-off date is fast approaching, and advertisers need to start looking for new solutions to engage customers in a personalised way in order to deliver effective digital ad campaigns.
The reality is that digital advertising has always been a fast-paced environment that is no stranger to disruption. Technology and processes have advanced rapidly over the past two decades and change is a given – if not a constant – within the sector.
It is probably fair to say, though, that the demise of the third-party cookie is the industry’s biggest challenge yet. We’re seeing what was the mainstay of how we enable advertisers to track and identify users removed.
Why this change is needed
With the growing consumer and regulatory demands for digital privacy, in particular the arrival of GDPR, this change has been inevitable. It’s important to note that however much we have come to rely on cookies, they have always been deeply flawed. Initially created as a means to help improve user experience on websites, cookies were never intended for the purpose they have been given in the digital ad industry.That said, their demise does leave those involved in the digital advertising industry with a big challenge: finding innovative new ways to help marketers get closer to customers and deliver relevant and targeted advertising experiences, while at the same time balancing the need to adhere to data privacy requirements.
Unquestionably this means the industry’s digital foundations and measurement strategies will need to be completely rebuilt, but this is as much an opportunity to build something transparent, sustainable and fit for purpose, as it is a threat to what we have now.
Solving the identity challenge
Central to these new foundations is understanding how to solve the problem of identity, and to do this with consistency. First-party data is seen by many as holding the key to unlocking this and solving the problem of identity. And as we look to grow first-party relationships at scale, publishers are taking this imperative seriously; indeed, we can see this now becoming the number one priority for leadership. The same is true for advertisers who are coming up with new strategies to grow their first-party relationships with consumers.
There is lots of on-going innovation to create new sustainable and scalable platforms and solutions that help advertisers gather and use first-party data to connect with their target audiences in this new landscape. But, as things stand, there isn’t one silver bullet, or single solution, that answers this challenge.
Taking a multi-pronged approach
For now, I believe, the answer lies in taking a multi-pronged approach to solving identity. Yes, first-party data goes some way to achieving this, but brands can also achieve great campaign performance using strong and innovative contextual solutions. Advertisers should not be shutting any doors at this moment, they should be constantly testing the solutions that are out there to see which ones help them best to meet their marketing and business goals.
Ultimately, if advertisers want to increase the effectiveness of their campaigns across the open internet in the post-cookie world, they need to be working with partners that can join up these conversations without operating a walled garden. Greater collaboration is vital. Companies like our own are focused on laying the groundwork so our clients can work flexibly with a range of identity solutions, including those built on first-party data, authenticated user data, industry identity solutions, and data science-based modelled and contextual solutions.
One thing that being in this industry has taught me, is that change is good. We have seen much of it and each time the industry has been forced to adapt to some new technology or process it has come back bigger and stronger. I see the changes that are currently taking place as part of the next phase of our evolution, and I’m sure with them will come a fresh new wave of innovation that will help us deliver a new ecosystem that is fit for purpose.
Harvin Gupta is director, solutions engineering at Xandr. Xandr is part of AT&T.