Marketing in the cookieless era

Signal loss and cookie deprecation pose varying challenges to marketers, as our online ecosystem has evolved around cookies in the past 20 years, particularly with respect to adtech companies, demand-side platforms and data management platforms.

Cookieless refers to a marketing approach in which cookies are not relied upon to target or measure consumer behaviours at the browser layer. The term “cookieless future” is misleading because significant cookie loss has already occurred.

Now that browsers are deprecating third-party cookies, the ecosystem that has evolved around them is also crumbling. Capabilities that have been leveraged by adtech and martech companies for years will be impacted including retargeting, frequency capping, cross-site tracking and social ads reporting.

Solutions for marketing in the cookieless era

Over the past few years, we’ve seen multiple cookieless solutions being proposed to ensure the sustainability of various marketing efforts. Some of them are deterministic IDs built on personally identifiable information or identifiers that can be traced back to an individual, and others are probabilistic IDs built based on inferred identity with modelling and machine learning technologies. The table below shows examples of deterministic versus probabilistic ID solutions:

Cookieless ID interoperability

Naturally, publishers and advertisers want flexibility – including for cookieless IDs to be as compatible as possible with each other. Momentum is building currently with both the cookieless ID providers and ID graph providers. For example, LiveRamp (RampID) and The Trade Desk (UID 2.0) have committed to interoperability – even collaborating on the development of an EU-specific UID (as per a LiveRamp blog). 

Now, let’s dive into some of the unique challenges and opportunities for brands and agencies.

The brand perspective

For brands, data loss due to third-party cookie deprecation will happen, but the degree of such losses can be controlled by taking a proactive approach to building alternative solutions.

If we think of first-party data as what brands know of their customers, then ID mapping between first- party data to martech/adtech platforms is like transferring a brands’ knowledge of their own customers to the vendors’ networks, to enable various marketing use cases including advertising, personalization, email marketing, etc.

Brands need to be proactive and reinvent their data strategy. Some key aspects to consider include:

• Do you have enough knowledge of your customers? 

Cookieless is going to amplify the existing data challenges that a brand already has. If there are issues such as incomplete customer profiles, or lack of signals to anticipate customer onsite behaviour for the short term, then those issues will likely multiply when third-party cookies are gone. To tackle those challenges, brands need to propose creative solutions to collect data.

• Do you have an effective approach to data management?

With changes occurring regarding regulations and within big tech companies, the way data will be used for marketing initiatives will likely change. Having an effective system and team in place to manage marketing data will be crucial for brands in the cookieless era.

Agency perspective

As third-party suppliers themselves, agencies have a number of considerations to address, including:

• Publishers

Collectively, agencies should be encouraging publishers to evaluate and to deploy cookieless identifiers. Broadly, it’s in the publisher's interest to reduce dependency on open exchange revenue and to support publisher-direct methods (via GAM and SSPs) into which agencies can distribute audiences directly.

• Adtech

SSPs need to be able to read the cookieless IDs’ user ID module within prebid and pass it to DSPs and exchanges within the header bidding process. DSPs also need to read a vendor's cookieless ID being passed in the bidstream from exchanges and SSPs (preferred direct model) and read Deal IDs passed from participating SSPs to facilitate retargeting.

• Clean rooms

Publishers should be standing up (and hydrating) clean room environments (e.g. InfoSum, Optable) so that the agency can ensure audience consistency and to enrich the agency's audiences with additional segment-level insights from the publisher that are net-new.

What does the future hold?

Changes are ongoing and it’s unclear what marketing will look like in the cookieless era. Based on what has been observed so far, here are a handful of assumptions:

• Safer, more privacy-focused online experiences for consumers
• Movement from data silos to more holistic data solutions across vendors’ networks
• Emergence of new measurement approaches
• An open ID may be accepted into the walled gardens
• Challenges with ensuring consumer consent management

Authors:
Stephanie Wu, Senior Manager, Marketing Data Strategy and Martech Enablement, Bank of Montreal
Darcy Kelley, Managing Director, Annalect Canada, Omnicom Media Group