"Data-Driven Thinking" is written by members of the media community and contains fresh ideas on the digital revolution in media.
Today’s column is written by Omri Kedem, programmatic media director at Croud.
Last Thursday, Chrome announced plans to delay the deprecation of third-party cookies by almost two years.
Chrome’s decision to temporarily maintain the third-party cookie leaves the industry with more time to prepare, but it only delays the inevitable. Major concerns around privacy are already having a significant impact on the fundamentals that have powered our industry for the past decade.
This is not the time to get complacent. Now is the time to create future-proof solutions.
It’s undeniable that the fundamentals of our industry - targeting, bidding and measurement - have to be reconsidered. In particular:
- The value and utilization of third-party audiences;
- The impending lack of impression-level data;
- Incomplete conversion data through limited attribution.
So the real question is, how can we as marketers react?
Micro-solutions to privacy concerns
With federated learning of cohorts (FLoCs) experiencing a number of regulatory issues to date, such as conflicts between the Privacy Sandbox and GDPR in Europe, we predict that they are likely to fall by the wayside by 2023 – so we can’t wait around for Google to develop their post-cookie alternative. We have to continue to be proactive with the solutions that currently exist.
We can start by developing a complete framework of all potential solutions that can help digital professionals become more privacy-centric in their approach to targeting, bidding and measurement. Here are some future-facing approaches that marketers may wish to pursue:
- Unified IDs: An initiative first conceived by the Trade Desk and the IAB as an open-source alternative to cookies. They do, however, rely on the collaboration of the digital ecosystem as a whole to agree on a unified solution, adopted by exchanges, publishers and partners.
- Server-side tagging: A tagging solution that shifts the implementation of “tags” from a user’s browser to a website’s server. This will protect a site’s first-party data and will effectively have to become the gold standard for all tagging.
- Ads Data Hub: A privacy-centric data warehouse, forming a solution that can replace data transfer. The main difference with Ads Data Hub is that nobody can access these user IDs from Google, retaining the increased level of privacy that is required.
A macro-approach to strategy and creativity
However, it is well known that many uncertainties still exist and a handful of developments remain in the pipeline. For this reason, there is increasing value in stepping back from micro-solutions and looking at your approach through a wider lens. To do this, we have developed a more macro approach.
We need to return to our roots and revive the importance of strategic planning coupled with a robust creative strategy. You will be able to see great value in planning and analytics teams working more closely with trading teams, to truly identify who your audience is and where it can be found online. The goal is to develop a data-driven creative strategy that aligns with your targeting, environment and objectives.
Let’s jump into a few of these in greater detail.
AI and machine learning-powered solutions available within platforms can assist in reducing the reliance on user-level targeting. They can also be used to boost long-term value (LTV) for brands without user-level data being shared.
Marketers can make use of lookalikes, audience expansion, automated bidding or custom bidding algorithms.
To measure the real impact of your activity, you should explore smarter measurement solutions, such as:
- Controlled experiments: These are now vital for calibrating and complementing digital attribution (example: A/B testing).
- Causal effect analysis: We can use Causal Impact modelling to prove the impact had on a KPI with the introduction of a new channel, campaign or tactic.
- Marketing Mix Modelling: MMM attributes the performance to individual components of the marketing mix, including competitor activity and other market factors.
With the hyper-targeted nature of display and video campaigns becoming less significant, the growth of emerging programmatic channels such as connected TV (CTV), programmatic digital out of home and digital audio must become a key focus for advertisers to drive industry growth.
In the US, CTV ad spend reached $8 billion in 2020 and is set to reach $11.4 billion in 2021 - this should give an idea of the astounding potential for growth across Europe. Of 101 media professionals surveyed across the UK, 100% of them plan on investing more in CTV in 2021 than they did in 2020.
Looking ahead to a first-party data future
User-level addressability is a thing of the past. Now, the key is to maintain effectiveness. Marketers can do this by being smarter in the way that they approach the fundamentals of marketing: who is your target audience, where are they, and what do they want to see?