From the home office of Managing Director of Product, Chris Luken: 

As consumers, we may perceive ad targeting as nothing more than ‘background noise’ to our everyday activities. We know it’s happening and we’re used to it, so we don’t pay too much attention to how or why it’s happening. However, to media companies and brands, the ability to target ads to consumers based on their searches and browsing history is essential to be able to educate consumers on unique product/service differentiators within today’s ‘digital-first’ content consumption environment. 

In the spring of 2020, Google announced that Chrome plans to abandon support for third-party browser tracking cookies “within the next two years.” This change was prompted by increasing user concerns about privacy and new EU restrictions on individual-level tracking (GDPR), which gave consumers the power to better understand how their data is being used and when they are being tracked online. 

So how can brands make better digital ad purchase decisions moving forward? 

Know when to use audience targeting approximations vs. precision targeting

Understanding how each digital publishing platform identifies, leverages, and implements consumer data to best approximate targets with intent to purchase will be critical to digital advertisers seeking to reach a specific target audience. Not every digital publishing platform will offer the same ad targeting opportunities, but many will claim to be ‘the best’ for any given target audience. Identifying the foundational assumptions that inform the unique targeting logic on each platform is critical in determining which publishers are best able to deliver on advertiser objectives.

Improve ad content and its relevance to the viewer’s online journey

Beyond qualification of intended ad targets, advertisers should also think about the contextual relevance of the ad itself, as the ad’s context within relevant publisher content will play a more substantial role for converting unidentifiable digital visitors over the intermediate-term. For example, if someone is seeking more information about high blood pressure treatments, a better place to qualify and reach those targets would be on health-driven websites rather than on a website with recipes for loaded mashed potatoes. 

Asking well-informed questions of media publishers regarding their targeting and contextualization capabilities will become crucial as third-party cookies are retired. Brands and agencies should also understand what KPIs are collected and how they are being attributed at each level of the sales funnel to further optimize their digital marketing expenditures. 

Plan for the Future of Digital Publishing Measurement

We can expect to see digital publishers evolve into contextually-specific ‘walled gardens’ in the absence of third-party ad targeting metadata. Obtaining a detailed understanding of how each digital ad solution is uniquely poised to deliver high-relevancy content around each advertiser’s brand message will be essential to long-term success. 

It’s important to remember that the future of digital content consumption is (and will remain) personalized. How content personalization will extend to a digital visitor’s advertising experience will remain an open question, and it is likely to differ by digital publisher in the near-term. 

Here are some predictions for how digital ad strategies will shift as cookies are phased out:

  • An End to “Free” Content: Digital publishers that previously exposed their content without charge to anonymous online audiences will likely require users to be authenticated in order to access “free” content. This is already happening on many news sites and likely will become more commonplace. Users will have to opt-into first-party data collection, and publishers can then deliver personalized ad targeting. This authentication model will help advertisers and marketers work better with publishers, since publishers can verify who their customers are and can best monetize their audiences for their sponsors. 
  • Cookie-Free Targeting Solutions: Identity federation solutions (such as LiveRamp) and large consumer technology companies (such as Google and Apple) will continue to invest in developing alternatives to cookie-based tracking in order to target ads based on intent-based actions. These technologies will further entice advertisers and publishers to use their own unique tools to target their ideal customers. Conde-Nast has rolled out their own cookie-less contextual targeting solution, and we foresee others doing the same in the near future.
  • Risks to Precision Targeting: Demand-side platforms and data management platforms that are critical to programmatic ad buys will continue to offer segments to ‘overlay’ behavioral/ demographic/psychographic/intention-based data sets against digital ad impressions.  Their precision targeting, however, will likely get fuzzier in the intermediate term due to fewer third-party tracking cookies being supported in common web browsers. It is quite possible that the same amount of traditional digital ad spend will produce a lesser degree of brand awareness among intended target audiences as third-party cookies are retired, thereby reducing the expected sales lift or ROI that many brands historically observe following their digital campaigns.
  • Return to a Pay-for-Impressions Model: Ad frequency capping (i.e. setting a maximum number of times an ad is served to the same person) is likely to become very difficult for a purely ‘anonymous’ digital visitor if first-party audience data cannot be captured. Digital advertisers may have no choice but to continue to ‘pay for impressions’ if they choose to serve ads to unauthenticated viewers on digital content networks.
  • Fewer Performance Insights: Without knowing how, when, where, and how often an anonymous digital visitor saw an ad before taking the advertiser’s desired action, the ability to understand how a certain social channel or website performed at each stage of the prospect’s ‘conversion journey’ will be significantly impeded. It’s possible that we may return to a ‘last click attribution’ model for anonymous content viewers, providing substantially fewer insights to advertisers about what aspects of their campaign helped to drive audience actionability.

Despite the restrictions that continue to roll-out around cookies, we anticipate more innovations that will circumvent and/or complement legacy digital ad tracking mechanisms. In the meantime, asking smart questions about media buying tactics and ensuring that marketing goals align with contextual ad placement opportunities will need to suffice over the near-term while the advantaged industry players continue to fill the measurement gaps that third-party cookies have historically enabled.

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