Interviews, insight & analysis on digital media & marketing

The long and short of short and long-term approaches to cookie deprecation

By Carl White, CEO at Nano Interactive

Google’s Publisher Advertiser Identity Reconciliation (PAIR) announcement last month was hailed in some quarters of ad tech as an about-face from the tech giant. Of an admission it would work with new, post cookie IDs after all. But the truth is a little different. PAIR only allows audience resolution for users who have “visited both an advertiser’s and a publisher’s site.” Which immediately rules out most buyers from using it. And in Google’s own words, “it doesn’t allow for tracking people across the web”, which is explicitly the aim of post-cookie IDs.

Even if it accepts hashed email IDs in principle, PAIR extremely limits their use versus any other current interpretation of it. Overall, in formulating its own rules around the email-as-cookie, you could even argue PAIR is not out of place alongside GDPR, iOS 14.5, IP addresses in GA and cookies on Chrome. And what do all have in common? Together, they spell out a pretty clear path ad tech is heading in, either with or against its will. 

Whether it’s enforced by Apple, Google or the EU and State of California – the underlying theme is the same every time: one step closer to a 100% opt-in future, across the industry. Put even more bluntly, it’s a future where the consumer decides, not us.

And I believe it’s now also time to distinguish between short-term tactics to temporarily batten down against the waves of change, and solutions that complement them, well into the future.

‘Disrupted by Tech Restrictions & Stricter Regulations’

First, let’s take in just one of these ‘enforcement events’, which in the round make up such a clear trend, to understand the industry’s typical response and the impact thereof. 

With Apple’s transparency changes introduced last year, app tracking went from opt-out, to explicit opt-in from the consumer. Despite these being anything but an overnight switch, even a major firm like Facebook – who you’d expect to have a back-up plan, if anyone did – reportedly took a $10bn earnings hit. Even with forewarning, and a tech giant’s resources, breaking up from targeting methods open to disruption seems hard to do. 

As ever, you can’t fault the creativity or the effort across the industry at large. Between alternative IDs, post-3rd-party-cookie-1st-party-cookie solutions and email-based identifiers, cookie deprecation has become a corner of the Lumascape in its own right. But should that mean greater complexity, or cost for publishers and advertisers? In one of these player’s own words:

“The ecosystem is constantly evolving and being disrupted by technical restrictions and stricter regulations.“

If that is the case, what is the long-term plan here? Like the early days of programmatic, with its rich tapestry of SSPs, DSPs and exchanges, some argue – at this point at least – it is a patchwork of solutions that must most often be used together. 

For example, if Google’s Sandbox by its very nature only covers Chrome’s share of the market, what about the rest? And what portion of the ad universe will the email-based Universal ID 2.0 cover, given that Google has declared it will not deal in this currency

As mentioned above, some will argue the PAIR news signals a softening at Google towards user profiling. But we should also note alongside this announcement it cited Ad Perceptions research: “Seventy-six percent of advertisers and agencies find the usage of IDs based on pooled data concerning from a regulatory standpoint.” 

A final point to consider: if any of those same IDs, as is rumoured, function based on fingerprinting, rumours swirl about a future update of Safari that will effectively shut down them down, at least among Apple audiences, which account for 40-60% of overall impression volumes, according to analyst Matthew Goldstein. Those reliant on such providers, would do well to ask what is their plan B. Just as iOS 14.5 and ATT showed, the promise of 100% addressability can switch to around 25% in short shrift when tech giants put the consumer in the driving seat.

Long-Term Solutions, Real-Time Intent

What is ultimately the thinking behind all of the above activity? Arguably, it’s simply about recreating the security blanket of third-party cookies. But what if this is actually an opportunity to actually improve upon the tactics of the past. Let’s not forget that even when cookies had more or less full coverage, reportedly they only recognised user gender correctly 50% of the time, with age accurate in just 25% of cases. 

In summary, we have already entered what is effectively a new era of ad tech, whether we like it or not. Short-term, you can still more or less maintain the status quo. But understand the potential risk and resource cost of doing so for the future. Have a backup plan, and don’t forget you are potentially saving up even greater, faster enforced change down the road. 

Armed with insights around real-time intent, context and attention metrics, switched-on clients are already building tech giant-, privacy- and policy-proof targeting strategies.

The long and the short of long-term solutions to cookie deprecation is just this – they are no longer a future vision, but already within our grasp.