“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 Ray Kingman, CEO at Semcasting.
We all knew the day would come when third-party cookies and device IDs would no longer be the Rosetta Stone of the industry. We are well into the first quarter of an entirely new identity resolution game. Ad tech and brands still don’t have a clear answer, so there is a lot of Identity Linking, FloC’ing and UID’ing being done in hopes of grabbing a piece of the next ID gold standard.
Regardless of which proprietary identity resolution option works out, advertisers need to be certain that the solution they choose allows them to continue first-party onboarding and third-party audience creation. Advertisers need a clear technology path that translates across the entire ecosystem. The chosen approach needs to inoculate them from legal exposure without sacrificing the efficacy and reach to audiences.
Here are the questions advertisers must ask to future-proof their identity solution:
Is the “solution” a workaround or a holistic process for resolving identity challenges?
Every technology challenge presents an opportunity for a technological workaround, and ad tech excels at workarounds. But that’s insufficient here. Platforms, lawmakers and, most importantly, consumers, have spoken. We’re changing the way we do privacy and identity, and that’s a fundamental change that requires a new foundation.
The hallmarks of that new foundation are informed consent, differential privacy and a federated ID system. A holistic identity process is one that is capable of ingesting data from anywhere and resolving that information in a way that respects privacy.
Is informed consent central to the identity solution?
There are no workarounds for informed consent – none that pass a common-sense test anyway. Structurally, we’re moving from an opt-out to an opt-in model. Advertisers need to secure consumer permission before using their data, and they need to secure that permission transparently.
Advertisers will seek that permission across all channels and consumer touchpoints, but once consumers give informed consent, every stakeholder needs access in order to holistically manage those permissions. Consumers need a way to easily withdraw their consent or qualify how their anonymous ID can be used. Many privacy management tools exist for that purpose, but to bulletproof an identity solution, advertisers must ground everything—tools, processes, leveraged social graphs—in the principle of opt-in.
Can you do differential privacy?
Formalizing the privacy protection and efficacy of the use of a person or household ID inside an audience involves the building of cohorts that cluster users in ways that align with campaign goals. A cohort may involve qualified users who have provided informed consent, but the same campaign can also incorporate selective use of publicly available attributes of anonymous users defined by demographics and contextual interests. Those cohorts may become even more complex within certain verticals, like health care and finance, because those industries require compliance with HIPAA and GLBA, respectively.
Advertisers need the capability to manage multiple, differentiated audience cohorts within a single campaign. While there are tempting workarounds that leverage browser tracking, advertisers should proceed with caution because such quick fixes don’t honor the spirit of the foundational shift toward opt-in. Advertisers can only bulletproof identity solutions by insisting that technology partners demonstrate the provenance of their privacy cohorts without browser tracking.
Are you using a federated ID?
A federated ID is a unique match between the audience identifiers and each of the media platforms that serve advertising—Xandr, The Trade Desk, Google DV360, Roku, etc. This anonymous ID has a limited usable life span, typically a few days. Since the federated ID is proprietary to the media platform, redistribution is impractical. A user match is unique to each campaign and is not usable on any other media platform.
By employing a federated ID, advertisers are removing the third-party cookie exposure that has plagued the advertising industry. There is no workaround for a federated ID. Either you have a system where every identity use is situational and no single entity holds the keys to unlocking identity, or you don’t. That’s why advertisers should be wary of promises of a “universal” or “common” ID.
What will the future of onboarding and matching look like?
The next iteration of ad tech is a work in progress that will define 2021 and the years to come, but it’s important to speak in concrete terms about what a new audience design platform looks like.
The more concrete that vision is, the easier it will be for advertisers to future-proof against evolving consumer privacy sentiments, the need for brands to adopt new internal privacy principles, an emerging legislative framework and shifting guidance from Google, Facebook, Apple, etc.
A successful audience platform supports public data cohorts, federated onboarding, differential cluster targeting and cross-platform attribution. But of course, supporting those capabilities is only the first step. Advertisers need to be able to deliver high match rates, move to market quickly and do so with accuracy.
Implementing such an audience platform will take significant work in the short term. But the long-term dividend is far greater than functionality and compliance. We’re at the dawn of a new paradigm and the sooner advertisers adapt, the sooner they can discard the friction that plagued the old model and return their focus to their business needs.