The Complexity Of Identity In A Post-Cookie World

In this guest post, Xandr senior director market development Samuel Tan (main photo), takes a look at our post-cookie world and asks what will the impact be on a brand’s identity…

The crumbling of the cookie creates a complex situation around identity – how will brands know who, or where, their audience is without those handy cookie data crumbs?

The short answer is there is no silver bullet – any one-size-fits-all solution will have inherent limitations that may not be obvious from the outset. Advertisers who do the groundwork to re-identify their customer base via a true “trial and test” model and embrace the complexity (and opportunity) of the post-cookie world can develop more efficient and effective engagement with their customers.

What works for one brand, however, may not work for another, so advertisers need to be prepared to explore a range of approaches. Whether it’s through creative messaging, emotional targeting, or keyword usage, brands will have to think smart, go back to basics, and be flexible when it comes to engaging consumers.

The shift to first-party data is a win for both the industry and consumers. Quite simply, the online world needed to evolve given increasing privacy regulation and consumer expectations. In the post-cookie age, consumers will have greater control and choice over the way their data is handled, actively selecting what type of information they part with, with who and when. One example is Apple’s privacy changes, implemented via iOS14.5, which requires users to opt-in for cross-app tracking. The user opt-in rate for IDFA is expected to be low and cross-app tracking will likely steadily decline.

CTV and OTT take centre stage

The big opportunity of course is for CTV and OTT advertising, as both have accepted practices requiring signed-in users who have willingly shared their data for the privilege of on-demand access to premium video content on the biggest screen in the home. CTV has rich data insights on viewers at a local, household and even device level.

Xandr’s CTV – Advertising’s Creative Canvas report this year shows that almost half of Australians aged over 14 have viewed content on CTV and 30% of them are doing so daily. Add the fact that CTV is growing exponentially – up 22% year on year with highly viewable ads – at 90%, the opportunity for an addressable, engaged audience at scale is not lost on marketers and media agencies.

And with BVOD consumption up 8% in H2 ’20 vs H1 ’20, Australian broadcasters are growing robust first-party data offerings. In addition, there are some key formats emerging as advertisers and publishers look for alternatives to the third-party cookie.

Why contextual counts

I believe we will see the renaissance of contextual advertising, a source of marketing which has been severely undervalued in recent years. Contextual advertising is still the predominant tool of choice. It is the backbone of linear television advertising which is up 5% in Q1 and is a key tool for brands looking to reach relevant and engaged audiences as it involves using context and a brand’s native environment to enable advertisers to identify and engage specific audiences – at scale.

While this value proposition was somewhat overlooked in digital environments, the absence of cross domain tracking via third-party cookies has brought to light that the context of a page is equally as relevant as a consumer’s behaviour. Contextual advertising uses key words and the content of web pages, rather than data from cookies, for the placement of relevant advertising. It follows that a person reading reviews about kitchen appliances is likely to be in the market to buy.

While contextual advertising took a backseat to third-party data mining, the tectonic shift facing the industry has brought a re-emergence of contextual targeting as a method of choice for advertisers. It doesn’t rely on individual identification, and it also harnesses new technologies like artificial intelligence and machine learning to help brands maintain the automation and operational efficiency brands have become accustomed to with programmatic.

Positive change for the future

The post-cookie world presents a challenge for advertisers – but it’s a good one. It’s an opportunity for brands to rethink the relationship with their audience and focus on quality, premium media and data; to re-engage with their customers in a meaningful way and rebuild the trust often lost in the old-world data exchange. The new playing field also presents opportunities to explore new partnerships with technology platforms and ad data companies to help identify a brand’s audience and seek out new buyers.

While some are fearful of the cookiepocalypse, we see it as an opportunity for a better industry. It will allow for better content delivery, meaning a better audience experience, better creative and better results for brands. I say, let the cookie crumble.

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Samuel Tan Xandr