“The Sell Sider” is a column written by the sell side of the digital media community.
Today’s column is written by Erik Requidan, founder and CEO at Media Tradecraft.
As Chrome sunsets third-party cookies and data privacy laws roll out globally, the only happy publishers are the select few with lots of first-party data. Mid- and long-tail publishers, not so much.
Only a handful of sites on the open web truly have first-party data. For everyone else, including niche sites that consumers love, reality looks very different. There is little access to reliable data, which ultimately means little to offer to advertisers, which translates to a massive drop in revenue.
But here’s a reality check, and it’s a rosy one: Even if publishers don’t have all the fancy tech and first-party data, they’re still going to be just fine.
Everything old is new again
Many publishers will transform themselves into tech companies, though they’re unlikely to hire teams of engineers and data scientists. Building their own tech and data practices is very expensive, can be extremely messy and requires constant refinement. But teams can be outsourced, and platforms leased. Most publishers will not have to build their own solutions, but they do need a plan.
This journey into the unknown, creating the processes – this is what drives innovation; it’s not just about those magical “lightbulb” moments. Most of the innovation from the maturation of programmatic came from small- to medium-sized publishers and tech companies. They were able to be nimble, agile and test new products and processes, or they forced innovation from within.
Facing the future with pragmatic optimism
My friend Felix Zeng at IBM Watson Advertising shares my sense of adventure about the year ahead, although he comes at it from the perspective of a seasoned professional with access to tons of quality data. Most of us don’t have that kind of access, but it doesn’t mean we can’t be optimistic about the future.
We build our own silver linings. GDPR and CCPA force us to reconsider the fair value exchange that we have more or less taken for granted for the past decade. Publishers assumed their magnificent content was worth taking all the data we wanted from consumers. It seems they disagreed, and we now have to recalibrate that relationship. In exchange for their data, consumers must be given more – or be satisfied with less. This realigning of the scale will resonate throughout the industry, affecting everything from the partners we choose to the creative choices advertisers make.
That’s not a bad thing. Felix suggests that we may be forced to consider different kinds of data as cookies and certain identifiers become unavailable to us. “Contextual, intent and weather data are alternatives. It remains to be seen what other types of publisher first-party data can drive results for advertisers.” Maybe we can consider how to improve on and better use these types of data, which will allow advertisers to personalize creative without getting anywhere near PII.
(We can also consider that the consumers who agree to give us more of their data are those we will most want to reach. These are the hand-raisers, right? It’s like having a double opt-in email list vs. spamming the universe. We’re just tightening the net.)
With so many changes to third-party cookies and data privacy affecting most sites on the web, perhaps we can reexamine other signals that impact ads and their effectiveness. The discussion from personalization and attribution can evolve. We currently have an ecosystem crazy for viewability, and yet there are so many other signals to which we should be paying attention, including those related to interactions, interest, intent, purchases and conversions. Companies that help in the buy and sell process can deliver more value by providing deeper and more diverse insights for an ad’s effectiveness.
Either way, we’ll be fine. Data privacy regulations and the demise of third-party cookies are just the latest hurdles for an industry that has already been to the rodeo. We are known for being innovative, scrappy, passionate and smart. If we can’t get over or under these hurdles, we’ll work through them. We will find the balance between privacy, personalization and profit, and as we do, we’ll drive the changes that will make this industry better and stronger.