The rise of native, fall of cookies, and the beginning of actionable transparency

Predictions 2018: Programmatic Native Advertising

In many ways, 2017 has been a call for change. After persistent ad quality issues, P&G’s Marc Pritchard demanded action on raising the media bar; stating the agency would no longer pay any partners that failed to meet its requirements on viewability measures, fraud prevention, and third-party verification. Consumers took a stand against irksome ads with increased use of blockers, especially on mobile. And the Internet Advertising Bureau (IAB) launched a new ‘Gold Standard’ initiative aimed at cleaning up the industry.

So, will 2018 be the answer to that call? If the signs are to be believed, it just might.

Cookies will crumble

The death of the cookie has been a recurring prediction for a while, but it seems the end is finally nigh. This year, Apple struck a decisive blow with its ‘Intelligent Tracking Prevention’ feature of iOS 11, which disallows tracking cookies and prohibits third parties from accessing first party cookies after 24 hours. And in 2018, a new set of laws could finish the cookie off: the General Data Protection Regulation (GDPR). In short, the GDPR requires companies to gain permission to access personal data, including any cookies used for identification, which means companies won’t be able to rely on implied consent and opt-out clauses. Moreover, as the proposed Data Protection Act (DPA) will adopt similar consent legislation, the changes will apply to the UK too.

For marketers, this will necessitate a dramatic targeting shift. Instead of concentrating their efforts on matching consumers’ online movements, they will need to focus on aligning with contextual signals and delivering ads that complement surrounding content. The effects of which will be positive for all: providing relevant ads consumers are less inclined to block, and enabling brands to improve results by using curated audiences from trusted publishers.

Transparency becomes actionable

Transparency was the buzzword of 2017. After multiple brand safety incidents put ad quality in the spotlight, demand for a clearer view of media became an industry chorus: P&G issued agencies an ultimatum, Adobe partnered with 15 vendors to improve fee transparency (disclosure: Sharethrough was one of them), and the IAB’s Gold Standard was launched to boost publisher use of ads.txt and certification.

Consequently, the next 12 months will see a clean up of the supply chain Ads.txt adoption has already been impressive on the sell side, and in 2018 will become the standard approach for programmatic buyers as brands put pressure to only purchase authorised inventory. . However, ads.txt is really just a warm up for OpenRTB 3.0. This new spec will offer a more comprehensive solution for a transparent and fraud-free ecosystem, allowing publishers to not only validate that an impression is from their domain, but also the user’s location, the ad size and a wealth of other information. This new transparency will see tolerance for low quality exchanges decrease, with those that do not bring value to the supply chain gradually pushed out of the ecosystem.

In feed video consumes preroll

According to the latest IAB Adspend report, digital has undergone a drastic revamp in recent months, with video dethroning the banner as the top display format. In fact, online video and native drove all display growth in the first quarter of 2017; with video investment rising by 46% and native in-feed absorbing 30% of total digital investment. And this transition isn’t isolated; a third of the ads bought via our own Sharethrough Exchange last year were native video.

The reason for the shift is simple: the industry is at last recognising the frustration caused by ads that disrupt consumer activity. As a result, formats such as pre-roll — which delay access to content and can be especially irritating on smaller mobile screens — are on the way out. In 2018, we can therefore expect to see the digital advertising balance tip even further towards more unobtrusive and contextually appropriate ad types designed for the mobile environment, such as video and native in-feed.

Indeed, quality experiences are shaping up to be the key priority for advertisers, publishers and consumers alike in the coming year. But if the industry’s enthusiasm for higher media standards, transparency, privacy protection and better advertising is to meet the needs of all, a unified effort is key. Only by collectively answering the call for change can we create a healthier ecosystem. So, with that in mind, let’s get to work.

Ally Stuart, Managing Director EMEA, Sharethrough.

Join Sharethrough at The Drum's Predictions Breakfast on Thursday 25 January.

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