Sergii Denysenko, CEO at MGID.
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Since Google first announced the phase-out of third-party cookies back in January 2020, the industry has been in turmoil, with marketers frantically searching for viable targeting and measurement alternatives. Later that year, Epsilon found that about 80% of the marketers surveyed were “very or moderately reliant on third-party cookies” for advertising purposes, and that figure hadn’t changed much a year later, despite significant preparation time.
However, more than two years after the original announcement, Google has postponed the third-party cookie’s death yet again. While a recent survey found that less than 50% of AdOps teams believe they’re prepared for the demise, the fresh delay gives marketers more time to seek new solutions. After all, the cookie’s eventual death is inevitable and will affect the entire industry. I believe that greater collaboration is needed to glean the necessary privacy-compliant data for valuable audience insights, and with access to first-party data, this is a gap publishers can fill for brands.
Bridging The Gap Between Privacy And Personalization
In the age of privacy, first-party data has become the holy grail of marketing. It’s more ethical than third-party data because it’s collected only by the website being viewed, as opposed to being gathered and shared by external players.
It’s not only marketers who are concerning themselves with third-party cookie solutions either; consumers have become increasingly aware of how their personal data is collected, stored and used. According to one company’s research, 84% of the consumers surveyed know what browsing cookies are, and 70% “don’t agree with companies tracking them for marketing purposes.” But at the same time, most consumers feel positively about personalized advertising, which leaves marketers with a bit of a conundrum. While the death of the third-party cookie is paramount for responsible advertising, marketers must still be able to create addressable audience segments.
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This is why first-party data is so valuable; it fills the tricky gap between ethical and effective targeting as it’s collected responsibly, while still providing useful audience insights.
Publishers’ First-Party Data Solutions
As first-party data is taken exclusively from the site a user is visiting, publishers have access to rich stores of it. They prompt audience engagement through their content, which can include articles, surveys and quizzes; they can also see comments users leave on the site, how they move around to different pages and whether they share content on social media. All this information can be combined to form comprehensive user profiles with interest-based data.
Publishers can further bolster this information by offering extra website benefits and tailoring the site to the user’s interests—through promotions, paywalls for special content or nudging for newsletter sign-ups, for example. Not only does this allow publishers to increase user loyalty, but they also can collect even more data to gain increasingly granular consumer insights.
Publishers can better monetize their inventory by offering these compelling audience segments to advertisers, with the added benefit of real-time insights that enable appropriate campaign adjustments. As a result, advertisers can tailor campaigns specifically to pre-qualified groups, improving campaign relevance and ROI.
Increased Collaboration Is Key For Publishers And Advertisers
Due to the sensitive and complex nature of data collection, first-party data strategies are not without their difficulties. Sometimes datasets may be disorganized or contain significant gaps, such as a lack of demographic or geolocation data. And there still isn’t a universal solution for analyzing or measuring the user groups identified via first-party data, so the quality of insights can vary wildly from publisher to publisher.
To give themselves the best chance of producing valuable audience segments for advertisers, publishers should start data collection early to allow as much observation and measurement time as possible. They could also work with technology providers to improve data management and analysis for better-optimized user profiles.
When it comes to providing their data-enriched inventory to advertisers, one way publishers can do this is via direct partnerships. Eliminating intermediaries can provide greater transparency so both parties can protect themselves from fraud, and brands have more control over their ad placements, meaning they can reach their desired audience segments more easily and increase ROI.
IAB Tech Lab’s free Seller Defined Audiences (SDA) aims to make this process even easier. (Full disclosure: MGID is a member of IAB Tech Lab. We fully support SDA, and our supply-side platform already sends SDA signals in bid requests.) The main goal of SDA is to create a standardized taxonomy whereby each user has an anonymous ID that is matched to the IAB Tech Lab’s unique classification framework, allowing users to be targeted based on their interests and behaviors in a privacy-friendly way. This means publishers can collect data in the way they observe it from users’ behaviors and actions on their sites, while advertisers can collect it to help with targeting and campaign measurement. This solves the difficulty of mapping audiences and segments between advertisers and publishers, which can be particularly tricky in the programmatic ecosystem where there are many intermediaries and bidders.
Advertisers and publishers can also collaborate via data clean rooms, whereby they can share data in a privacy-compliant way. Clean rooms, particularly independent ones, allow data owners to match similar audience groups and enhance user profiles through look-alike modeling, all without personally identifying individuals. This can be a way for advertisers to benefit from publishers’ rich first-party data without necessarily having to enter into longer-term partnerships.
First-party data is undeniably valuable in the privacy-first world; it offers a responsible alternative to the third-party cookie’s cross-site tracking and data sharing. Publishers’ access to this privacy-compliant resource makes them the perfect partners for advertisers, who can use their audience profiles to inform their own campaigns. It’s a win-win situation: Publishers’ data-enriched audience segments mean they can better monetize their compelling inventory, and advertisers can improve addressability and budget efficiency. Nobody knows whether Google will postpone the death of the cookie again, but when it does eventually disappear, greater collaboration in the industry will help brands still thrive.
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Author: Sergii Denysenko, Forbes Councils Member
