Tyler Kelly is the president of Centro, a digital advertising platform.
Death. Apocalypse. Demise. The language used to describe third-party cookie loss in digital advertising sounds morbid. It's almost as though we've forgotten how resilient our practice is.
The "sky is falling" headlines about privacy initiatives from Google (well, in a couple years), Microsoft and Apple make it seem as though advertising has never faced challenges before. But the industry has weathered disruption due to new channels, regulation and shifting consumer preferences for decades. The same innovation, determined problem-solving and optimism that overcame past obstacles can help it survive the transition from third-party cookies and similar identifiers to a more consumer-friendly model of finding customers.
At the moment, marketers face another reckoning: reimagining ways to get to know the customer in a privacy-friendly manner. Targeting will continue, but with a much larger focus on contextual targeting as opposed to direct information from the customer. It will still be possible to compare and analyze the overlap between publisher audiences and advertiser targets, but doing so is going to take a much greater level of sophistication and even larger external datasets.
Until a long-term standard for privacy has stabilized, some important short-term efforts to shore up privacy standards within marketing organizations need to occur. Internally, they'll need new tools and strategies to pivot toward collecting first-party customer data. But more importantly, the immediate efforts of the ad industry to change its ways are a signal to the consumer that it is taking their privacy seriously at a time where they've never demanded it more. This disruption doesn't need to slow advertisers' momentum, but they will need to commit to getting ahead of further change.
Five immediate steps to maintain continuity in marketing
Expanded consumer privacy is something everyone can embrace. But it doesn't make the subsequent changes to the way marketers identify and get to know customers through data any less daunting. How will they reach targets without third-party cookies? What can be used to measure the effectiveness of advertising now? Will they ever have the same level of knowledge about a customer base again? These questions are natural, and can be answered by focusing on five areas in the short term.
- How many anonymized data sources are marketers currently ingesting? It might not be enough. To improve the fidelity of local data, they'll need to expand the amount of anonymized data in the pipeline. The U.S. Census, the American Community Survey and the North American Industry Classification System could be a good start — these datasets provide local insights and information that can unlock better decisioning.
- First-party data is the building block of future marketing efforts. But the data is even more valuable outside of a vacuum. An anonymized overlap analysis directly between marketer and publisher, for example, gives better insight into customer composition, reach and preferences.
- Machine learning and artificial intelligence combined with ad-buying can give immediate advantages. Leading-edge solutions incorporate dozens of parameters to help marketers place their bids for impressions — without infringing on target privacy or using cookies.
- Targeting doesn't need to suffer. Contextual targeting has evolved over the past decade, and using natural language processing, marketers can now better understand and capture consumer semantics and tone. Much of the audience-based media-buying world is cookie-based and depreciating.
- The new emphasis on privacy will force a shift in key performance indicators and how marketers define success in general. In the short term, readjusting these KPIs to account for the lack of third-party cookies will be key, as will pivoting to a conversion-tracking model that uses cookie-less conversions for click-throughs only. The way information is collected about consumers is radically changing, and marketers' KPIs and expectations need to keep pace.
There's no reason for marketers to lose momentum because of these changes. Ultimately, a larger focus on privacy answers consumer concerns, but also affords an opportunity to find deeper, more insightful data on their customers. This is no doomsday in advertising. It can still get back to basics of putting the right ad creative in the right place at the right time. It will take ingenuity and perseverance — something the industry has never lacked — to strike a balance between privacy and needing to know target customers. But it won't be the end, rather just another disruption from which to emerge stronger.
Tyler Kelly, a 15-year veteran at Centro, leads its sales team, managed service organization, and customer experience group that steward digital ad spend for brands and agencies. Tyler's acumen on automation, digital media and programmatic advertising is featured in industry outlets such as Advertising Age, Adweek and MediaPost.