Why Cookieless IDs Need Full Adoption and an Identity Layer
Major disruptions like CCPA, Apple’s decision to roll-out opt-in for tracking via IDFA, and Google’s push to kill the third-party cookie have triggered a frenzy within the ad industry, spurring AdTech providers large and small to rethink identity. Identity is not a nice to have – it’s a must have. Providers are touting “cookieless” tracking capabilities as the next generation of “identity” by using authenticated hashed emails, but are they?
Here are other approaches that are still in development:
Authenticated user solutions use self-submitted information, which is good for privacy, but provides the least valuable information about an individual. Advertisers require far more to support their targeting efforts and need an identity layer.
1st party cookies may meet the need for privacy and attribute requirements for an advertiser, but they lack scalability and, in most cases, need an identity layer.
IP Address solutions are good for targeting a group of people behind a router or at a certain location (e.g. a house or office building). But, in most use cases, these solutions cannot accurately target groups or individuals outside of a location without an identity layer.
With these shortcomings in mind, the industry is tirelessly trying to answer a single question – “how do we digitally identify audiences in a privacy-first and compliant way that does not use a 3rd party cookie?” The answer is less about inventing more solutions from the ground up and more about building upon the solutions we already have in place. Additionally, we need to find ways to integrate these solutions into the supply side.
Authenticated cookie-less tracking utilizes scripts that run in the background when a user visits a web page (thus removing Google, or any other browser for that matter, from the equation). This solution requires a log-in event and relies mostly on a user’s email or phone number captured during the log-in process.
First, a visitor creates an account to access content on a media site. That site stores the visitor’s email and password so that it can recognize and authenticate return visitors. Since this data is considered PII, cookieless providers convert the authenticated email into a hashed email and then associate it to a randomized ID sequence of letters and numbers unique to the user.
In the last several years, numerous firms have emerged offering a variety of cookieless IDs and data connectivity solutions. Like historic cookie-based solutions, cookieless solutions still rely on converting native information into hashed information, and cannot provide a valid identity behind that cookieless ID. As AdTech providers continue to work out the kinks in cookieless tracking, a host of new questions plague the industry:
Should DSPs select one cookieless ID provider or put the technology in place to accept and utilize as many disparate cookieless IDs as possible (to expand reach and manage frequency)?
Should Publishers select one cookieless provider or accept many?
Does the technology of one or more providers disrupt user experience?
Can multiple providers work together in a complementary fashion, or is it a “winner-take-all” situation?
Should brands and marketers rely on a single cookieless ID or work with intermediaries that can map 1P data across multiple cookieless IDs?
The Problem With Just Picking One
Accepting one cookieless solution certainly simplifies the equation, but it also creates inventory gaps and increases the probability for under-scaled audiences. Additionally, identities constantly change, making it nearly impossible for one provider to a) see all who use the open web and b) track the multitude of IDs both within and across providers associated with a single individual.
On the other hand, a shared universe that is inclusive of many cookieless IDs could:
Help with the consolidation and the distilling of multiple IDs down to single individuals.
Improve the accuracy of ID matching to actual individuals.
Allow providers to affix multiple IDs to a brand’s data.
Deliver audiences to a DSP across multiple ID sets.
Increase reach across a disparate ID supply chain.
On the supply side, using multiple ID providers would also ensure that a publisher’s advertising inventory gets maximum exposure, resulting in numerous advantages:
Avoid single-source risks associated with picking one cookieless “winner”.
Scale and bridge information gaps to expand the breadth of available identities.
Simplify the process to enhance flexibility and efficiency rather than chasing multiple single ID solutions.
Reach a broader audience to improve the measurement of performance and targeting.
Improve the reliability and quality of data and identities.
The Solution: An Open Identity Layer (Open ID) Across All Cookieless ID Providers
If the ad industry is to solve the cookieless ID problem, they don’t need more solutions, they need an orchestrator that brings existing cookieless services, identity, and other parts of the identity ecosystem together. Rather than narrow the selection to a single solution, a well-orchestrated provider of ID services could transform hashed emails from a publisher into a cookieless ID, connect that ID with a real person, and provide an ID layer beneath the cookieless ID to identify matches and champion the most accurate data in an increasingly cookieless world.