2020 turned out to be a year like no other, and that was no less the case in the world of ad tech. Triggered by Google's bombshell announcement that they would stop supporting third-party cookies on their Chrome browser by 2022, identity, and how to approach it, became a primary focus for many.
In our first in a series of prediction articles, figures from across the industry tells us what they think 2021 will hold for identity.
Universal identifiers will become the industry's primary currency
Digital identity has been universally challenged since 2017, but it wasn’t until 2020 when the whole ad tech and martech ecosystem found itself prioritising the seismic shift that loomed on the horizon. I’m confident that 2021 will be the year of digital reinvention and transformation, marking a long overdue and anxiously anticipated market correction forever shifting how digital is transacted across the board.
The future is now and the stakes are high. The cookie is living on borrowed time and with imminent change (early 2021) coming to how the addressable market can lean on the IDFA, Apple has eliminated any shred of doubt that they will mandate that consumer privacy will be paramount to personalisation.
Value exchange will lead to value creation as publishers and marketers seek to earn and scale user trust and consent as a mechanism of establishing a more meaningful consumer experience. That may translate to more metered paywalls, increased subscription based solutions or simply more quality content consumed in the form of opt-in email newsletters.
An impression will no longer be just any old impression. Supply will be bifurcated. “Users” will be more valuable than “Visitors” while bidders will have to adjust to compensate for this brave new world. Authenticated users will yield significantly higher media CPMs than non-authenticated alternatives and marketers will rapidly adopt universal identifiers as the primary currency by which they trade by H2 2021.
The scramble is on. Welcome to digital advertising’s new frontier.
Matt Barash, SVP Global Publishing & Platform Partnerships, Zeotap
Contextual could prove the next big thing
2021 will see a handful of post third-party cookie solutions establishing themselves as different ‘passports’ a user can exhibit behaviour under. Our job is to stitch those behaviours together into a unified view of the user while simultaneously enabling communication of the resulting targeting information about each user to the relevant activation platforms under the ‘passport(s)’ each accepts. If that gets us to 25% user identifiability after 2021, contextual targeting will become significantly more important and experience a bout of innovation that resides in the intersection between user and page-level targeting. If we get to 50% identifiability user-level targeting, it will continue to have strong legs of its own — which means user and page-level targeting will share the stage, affording even more potent syntheses between the two to create qualitatively new targeting solutions.
Kasper Skou, CEO and co-founder, Semasio
The "sphere of influence" will come to the fore
One of the more prominent themes we can expect during 2021 are more negotiations between ad tech vendors and browser operators as third-party cookies depreciate over the next year or so. Google’s “Privacy Sandbox” framework has accelerated this, and it’s likely that we’ll see more news about first-party data and identity graphs as ad tech vendors enter this new paradigm. Household targeting, omnichannel video and CTV will take centre stage as marketers enhance their focus on the “sphere of influence” impacting most buying decisions, understanding that consumers often look to family and friends for advice before making purchases. This is especially true for big-ticket items such as cars and vacations, but also for daily decisions such as which restaurants to order from, which movies to watch, or which nearby stores carry the best wine selection. This underscores the importance of localisation within creative messaging as well, as studies show most consumers fulfil daily purchases close to home. Additionally, consumers are increasingly buying online to pick up in store (BOPIS), and looking to support local businesses as communities around the country recover from the pandemic.
Jim Johnson, VP, Account Planning, VDX.tv
First-party identity-based data will command a premium
With the retirement of the third-party cookie, first-party identity-based data will command a premium, as will data partners who can provide scale and reach without an identity spine. Innovative companies dedicated to a consumer-centric future will continue to power compliant addressability and deep audience understanding, without sacrificing performance or consumer privacy.
Fiona Davis, chief operating officer, Captify
Industry efforts to find cookie alternatives will accelerate
We'll see some pretty big shifts happening in the digital advertising world in 2021 as the move towards privacy-first policies take hold. The adoption of the California Privacy Rights Act (CPRA) was a watershed moment that will prompt a speeding-up of the global move away from cookies and the widespread use of consumer third party data.
This new act echoes the robustness of Europe's GDPR and will generate global momentum towards advertisers looking for ways to target consumers in a privacy-friendly way. Gartner predicts that 65% of the global population will be covered by legislation like GDPR or CPRA by 2023 - up from 10% today - significantly increasing the challenge to target effectively at scale while remaining privacy compliant.
Industry efforts to agree alternative solutions to maintain identity, such as the Unified ID, will inevitably move faster in light of this, helping to lay the pipes for the post-cookie digital landscape. Rich contextual data will increasingly be what flows through those pipes. Placing ads that tie in with the content that surrounds them is more effective, sustainable and more engaging for consumers. And, most importantly, contextual targeting doesn’t rely on third-party cookies, so it will help advertisers and agencies to maintain compliance within the new regulatory landscape.
We think that 2021 will be the year when advertisers discover that planning advertising that avoids the need to use consumer data is truly a win-win approach.
Peter Wallace, MD, EMEA, GumGum
Infrastructural changes will be prove less disruptive than many fear
There’s been a lot of doom and gloom around Apple’s IDFA opt-in rates when it flips the switch next year, but I think this is misguided. I think rates will be higher than everyone is expecting, thanks in part to the strong relationships between users and brands and publishers they trust. Don’t forget how many people are just going to hit “Yes” to get to the next step and play the game/view the article/watch the video. When was the last time you yourself, as a consumer, clicked anything other than “Accept All” on a cookie disclosure?
Jude O’Connor, CRO, AdColony
First-party data ownership will put publishers in a strong position
Identity will continue to be the big topic for 2021 - this is the final year for tracking cookies in Chrome and advertisers who are still looking for compliant alternatives may be feeling the pressure. I expect questions will be asked about profile-based targeting and whether it is really the best way to deliver results given it does not easily scale across the open web. Some interesting options should emerge for advertisers who are prepared to look at relevance in a different way.
Contextual has developed quickly in a short space of time, and in 2021 you can expect a lot more than matching brands to same-topic pages. For example, modern AI-powered methods now allow you to look at multiple contexts simultaneously, react to what is performing best for a campaign in the moment and then scale almost limitlessly. These methods have been shown to outperform some of the best traditional targeting tactics, so this is exciting for the industry.
Major publishers should end 2021 in a stronger position, as the owners of consented first-party data, and this will grow as more require users to subscribe or sign-in. I expect news organisations will continue to cluster together and more will develop their own contextual platforms which sell against sentiment rather than just topic, again allowing brands to reach users across varied content. Whichever way you look at it, the decisions made this year will be crucial in setting a future path for the open web, and I look forward to seeing more lateral thinking and collaboration at this important and interesting time.
Peter Mason, co-founder, Illuma
2021 offers an opportunity to build a universal, transparent identity solution
In 2021 the advertising industry will move closer to a cookieless world, one in which browserless environments including CTV are an increasingly large part of ad budgets, and publishers will have an increasingly important role in developing the future of identity. A publisher-created and managed identifier, used in conjunction with first-party data, to create segments that scale across all publishers will be a key driver of the new common identity solution to replace the current model. This is an opportunity to build a new identity solution that is transparent, cross-platform and equitable.
Steve Wing, managing director for EMEA, Magnite
Expect a step-change in how the industry explores User ID
The past year has been a process of exploration and education in User ID. While the deprecation of third-party cookies is undoubtedly a huge challenge for the digital ad industry to navigate, it’s also a massive opportunity to redraw the ecosystem around user experience and build a better ad-funded web for all parties - consumers, advertisers and publishers.
As an industry, we first needed to look beyond technical practicalities and root our objectives in the bigger picture of what the ad-funded web should - and needs to - be. At IAB UK, we established the core principles that we believe any viable User ID solution must meet in order to bring about meaningful change. These principles are rooted in transparency, user control and improving the consumer experience.
We have since been feeding into and facilitating our members’ involvement in global working groups - IAB Tech Lab’s Project Rearc and Google’s Privacy Sandbox - to explore and build on alternative User ID solutions with cross-industry, international support. Now, with one year to go until the cookie deadline, expect to see a step-change in the messaging and outputs from both of these groups.
Tina Lakhani, head of Ad Tech, IAB UK
The cookie obsession is set to continue
We can’t quit you, cookie. In a frenetic newscycle, digital advertising remained true to its obsession with the third-party cookie’s imminent demise. Google Chrome’s announcement in January of its plans to remove third-party cookies set off a firestorm of confusion and panic. In the months since, a conflation of third-party cookies with third-party data and privacy has proliferated, with the cookie becoming the punching bag in digital advertising. We don’t expect 2021 to deviate from that headline dominance as various players across the ecosystem claim cookie independence and revel in the cookie’s demise. On the flip side, advertisers will ramp up pressure on publishers to meet their various tracking, targeting, and measurement needs.
Chris Hogg, Managing Director EMEA, Lotame
Contextual intelligence will emerge as the leading post-cookie solution
With Google Chrome’s 2022 deadline on third-party cookies, the pressure is on for the advertising industry to adapt to a digital-first world without identified users. Although there are conversations happening on the standardisation of universal IDs, other industry players are leaning towards contextual intelligence as the solution to cookie-based targeting.
Moving into 2021, it is likely that contextual targeting – while not being a new concept – will advance as demands for cookie alternatives grow. Integrating AI technology, for instance, will enable advertisers to better evaluate the context of ad environments for relevance and brand suitability. Contextual intelligence can provide much-needed insight into user interest and behaviour, alongside in-depth analysis of how page sentiment and language nuances influence consumer interaction. This will allow advertisers to reach audiences in an effective and personalised way that prioritises consumer privacy.
Nickolas Rekeda, CMO, MGID