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The future of identity in a post-cookie world

In a bid to create a relevant online consumer experience, advertisers have long relied on data and cookies to identify valuable audiences for their brand. As programmatic technology advanced, so too did the adoption and application of identity solutions. But over time, privacy concerns arose and demands were made to make significant changes to consumer control and consent.

Once the go-to tool for digital marketing, third-party cookies are on the way out. With questions of how marketers can ensure they are keeping pace and maintaining relevance in this new world, what does the fall of the cookie signal for businesses and experts across the board, and what impact will it have on brands’ ability to create relevant online experiences for consumers?

The Drum teamed up with Xandr to explore this new world, with industry experts Peter Mason, co-founder at Illuma; Sarah Cometa, lead sales engineer at Permutive; Nick Halstead CEO and founder of Infosum; and Lauren Wetzel, head of strategy and corporate development to investigate.

Third-party cookies in digital advertising

General consensus among the experts is that while third-party cookies certainly started out on the right foot, over time this has changed. Mason expands on this, citing the third-party cookie as a dominant feature in targeting from the beginning of his career twenty years ago. “Over time they’ve become a kind of industry obsession”, he says. “Other more common sense aspects of advertising have been disregarded. It isn’t a bad thing that they’re going away, I think it will bring back a lot of creativity around first principles of advertising.”

This sentiment is supported by Cometa and Halstead, who both have concerns over the volume of consumer data that is being traded without consent by various publishers and advertisers. Both experts agree that the original intention has been derailed and the removal of third-party cookies is the only way to bring about better transparency and control in the industry.

Relevance or privacy?

To our experts, there is no reason why the two cannot go hand in hand. It is important to remember that despite the demise of the cookie, tailored digital advertising is not going away. In fact, in the industry’s determination to create a new path forward, new partnerships, better communication and collaboration will form. In discussion with Halstead, he notes the return to a reliance on first-party data as the most exciting aspect in this new era, explaining how the accuracy and quality of first-party data will allow for better collaboration among owners of high-quality knowledge to build new ecosystems in a privacy safe and transparent way.

Cometa too believes collaboration will be key noting how moving on from the third-party cookie era will allow advertisers and publishers to collaborate more closely as well as force publishers in their role as “data providers of the future,” to be more defensive of their consumers’ data. In doing so, they will be able to maintain digital excellence while protecting the rights of their consumers.

And finally for Mason the removal of the cookie brings massive opportunity for technical creativity and innovation where the industry will once again acknowledge the value of first-party data and return to the early principals of online advertising; finding the right people, in the right place, at the right time.

Building a better future

“The industry is going through probably the most disruption it has seen in almost ten years,” Halstead shares. “We’re entering this evolution where we’re moving from centralised data and centralised identity to a decentralised, post-cookie world that is much better for the consumer with better data privacy and better solutions for publishers and advertisers to work together to use greater quality data.”

While the future of ‘identity’ may seem uncertain causing advertisers’ anxiety to grow, the experts were unanimous in their optimism about our industry’s ability to build a better future. Data is already traded today without reliance on the third-party cookies in private marketplace and direct buys as Cometa explains her optimism, “we can now find a way to deliver value for the user without exploiting the end user” For Mason, this idea of justice is also at the forefront of his mind, believing that experts now have the opportunity to create a better and fairer ecosystem for everyone.

Embracing change

With the number of changes taking place, advice from Wetzel is to listen to the changes. It is essential that businesses ensure they keep pace with any movement as failure to do so could result in serious business implications and user experience impact. “Businesses should use this time to evaluate the platforms they’re working with- I often hear from buyers that they need something open, flexible and also that keeps first-party data at the core.”

For Halstead, it’s crucial that brands ensure they’re meeting regulation standards and really consider what information they’re sharing and how that can impact brand perception. Wetzel is in agreement here, believing that tech platforms in particular have a massive role to play. “Platforms have to ensure that compliance is at the centre of everything they do, as users are more vigilant than they ever have been around personal data and governments are responding with data protection laws; platforms must put the emphasis on compliance and privacy teams more than they ever have.”

The cookie-less world

For Wetzel, the free movement of personal data through the ad-tech ecosystem using cookies has always been an inferior solution and with the technical changes happening for the benefit of consumers, the industry takes yet another step towards a more relevant online user experience. This move away from third-party cookies allows the industry to better embrace transparency and encourage more industry collaboration with players across the ecosystem looking to industry trade bodies to lead the way. This will result in greater synergy and compliance across all sectors while ensuring the consumer remains our core focus. While we may not have all the answers today, the future is optimistic, it is down to us to lean in and make the change. Wetzel is right, “with great change comes great responsibility to adapt and innovate.”

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