When it comes to managing identity, change and uncertainty can feel paralyzing these days. Will regulators start requiring more data-sharing opt-ins? How far will Google’s and Apple’s limitations on the IP address go? Will all the privacy disclosures and requests for data push consumers to say they’ve had enough?
Rather than preparing for a single technical change, like the loss of the cookie, it’s best to prepare for a broader industry shift toward greater consumer awareness and autonomy. Regulators, Big Tech and consumers themselves are taking steps to increase transparency into and control over how data is collected and used by marketers.
The good news is these consumer-oriented changes are leading to more direct consumer engagement, rewarding those who have built good, trusted brands. The demolition of easily shared IDs also means the end of mass appropriation of data.
Plus, attribution changes are causing marketers to reevaluate where their ads run and whether they may have been overvaluing lower-funnel metrics and undervaluing upper-funnel ones.
With a multifaceted approach, companies can manage the risks while reaping the rewards of more consumer-conscious ad targeting strategies. And they can do so on their own terms – no matter when the end of the cookie, the phaseout of mobile ad IDs or the truncation of the IP address comes.
Creating a strategy
Being prepared is essential, industry leaders agree. “Now, more than ever, you need a strategy,” U of Digital founder Shiv Gupta said during a recent interview on how to tackle today’s uncertainties.
While he is encouraged by companies taking platform and regulatory changes seriously, Gupta said more needs to be done to move the conversation from “What solutions should we bet on?” to “Where should we lean in and where should we pull back?”
He recommends two key steps:
- If you don’t already have a strategy, create one now.
- Diversify. Implement a portfolio of multiple targeting solutions, hedging risks and ensuring you have an array of bets.
The portfolio approach has been recommended by many, including Dennis Buchheim (ThinkMedium) and George Tarnopolsky (Good Apple) at this year’s Programmatic I/O event. IAB Chair and President of Paramount John Halley invoked the same idea in his keynote address at the IAB’s Annual Leadership Meeting.
The challenge for many companies is knowing where to start.
The table below compares various approaches. It breaks them down first based on the type of data that underpins each, and then by a narrower tactic or data type.
For example, identity-based solutions are segmented further by the source of the identity data, recognizing that Big Tech or regulators will treat IP addresses differently from email addresses, and consumers may do the same for logins that require email vs. ones that don’t.
When considering the various approaches, companies should ask themselves: How do we do this thoughtfully? What are the relative pros and cons of each targeting tactic? When should we begin to see traction? How do we prioritize alongside our organization’s other initiatives? How do we set our own expectations, let alone those of our C-suite or investors?
Weighing risks versus rewards
The value of a good portfolio strategy ultimately lies in its ability to balance risk and reward. It’s important to employ a mix of each of the types of solutions, paying special attention to the underlying risks and where they come from: regulators, Big Tech or consumers.
A well-constructed portfolio ensures that no matter what the future holds, you are positioned to lean in or out without too much additional work or expense. Even if you decide not to test or implement certain strategies, understanding their relative advantages and assessing what work would need to be done to implement each will better position you to pivot if the market zags or risks become realities.
Some solutions have the potential to generate revenue immediately, whereas others will take time to make an impact. The idea is to make some bets with a diverse risk profile, run tests and gauge the relative performance and response from consumers. As the potential for an approach scales, you will be positioned well to take advantage of it.
While it may be tempting to just wait and see what works for others, you don’t want to be left behind when spending grows or deprive yourself of critical insights along the way.
Mandatory moves
No matter your profile or resources, everyone should:
- Enable a contextual solution or two at a minimum. Contextual has the lowest overall risk profile (assuming any cross-site profiling is transparent to the consumer) and high potential for AI to uncover correlations between content and brand interest.
- Implement an authentication-based identity platform. Getting users to sign in helps create authenticated audiences tied to reliable IDs. And publishers and marketers are more likely to meet privacy standards when audiences are given control over how their data is used.
While uncertainty will remain high in the short and medium term, creating a plan that incorporates different risk profiles will put you in the best position for the long term.
“Data-Driven Thinking” is written by members of the media community and contains fresh ideas on the digital revolution in media.
Follow Licorice and AdExchanger on LinkedIn.
