Google and post-cookie ad tech trends—everything marketers and publishers need to know

Google’s mixed cookie messaging—will they go away or will they continue to fuel online advertising—has brought some uncertainty, but alternative ad tech is stepping in to innovate as the debate over the ad trackers continues. In fact, instead of staying still, other internet ad players—most recently Microsoft with a new ad platform for the Edge web browser—are pushing ahead with privacy-preserving ad technology, too. New programmatic tactics are emerging such as curation, which bundles internet audiences across websites for brands to buy. Brands are using other channels for campaigns outside of the open web, such as retail media, connected TV, audio and digital out-of-home. Ad tech companies are making new identity connections that work around cookies. Publishers are making more effective use of their audiences to get value from readers even when they’re not logged into their sites. And the walled gardens—Meta, TikTok, Snap, Pinterest, Reddit and others—are the few places where logged-in audiences are still reachable. Also read: How Google’s post-cookie ad platform got derailed With all new ad tech comes added complexity, especially for advertisers that just want marketing to work, which means spending ad dollars, finding customers and measuring ad campaigns. “We’ve already experienced a ton of degradation on identity and signal loss for a long time with different events outside of Google,” said Rory Mitchell, general manager of global growth at digital ad platform Criteo. In this moment of change, Ad Age is explaining all the trends in digital advertising that marketers need to know in the wake of Google’s ad tech tribulations. Check out the latest Ad Age events and award programs What happened to Google’s Privacy Sandbox? Since 2019, when Google first mentioned making its Chrome browser cookie-less, the internet giant has been plotting the end of tracking, not just on its browser but also on mobile devices running Android software. Instead of using cookies, internet trackers that get dropped on browsers to facilitate programmatic ad deals in real-time auctions, Google set out to build Privacy Sandbox, a platform that controls what data gets passed along about consumers to different parts of the ad tech industry. Privacy Sandbox tried to transform internet ad auctions from taking place outside the browser to being entirely contained within the browser, so only approved data could move between buyers and sellers of ads. Also read: This year, Google was working with ad tech companies on the buy and sell sides to use Privacy Sandbox, as it planned to kill cookies by the end of the year. The timeline got pushed back, and development of the new platform stalled as Google met resistance from multiple corners of the industry. Ad tech providers and industry groups raised concerns that Privacy Sandbox could not replicate key functions in online advertising that cookies handle. Also, the key regulator overseeing Google’s proposal—the U.K. Competition and Markets Authority—had objections, forcing Google to abandon the plan to unilaterally shut down cookies. Regulators jammed up Google on two conflicting fronts: Google’s cookie proposal could stymie business operations that rely on internet advertising and commerce, regulators said. On the other end, privacy regulators were pushing Google to protect consumers online from tracking. Now, Google has a concept of a plan, where it wants to make cookies optional on Chrome web browsers through a mechanism like Apple’s anti-tracking prompts on iPhones, where it asks people if they accept apps collecting data on their internet habits. Google could show a similar prompt to Chrome users, requesting if they accept third-party cookies. The U.K.’s CMA still needs to approve how Google would implement such a mechanism. Google declined to comment for this story, and the plan is still nebulous. Also read: “The big thing that’s changed, obviously, is folks adjusting to the new reality that the third-party cookie is not going away entirely,” said Todd Rose, senior VP advertising at InMobi, the mobile ad tech platform, “but rather it will exist in, call it, in pockets, in greater sparsity. So how do you handle sparsity?” Check out the latest Ad Age events and award programs Why cookies and ad trackers still matter “Regardless of what anyone says about Privacy Sandbox or anything else, advertisers buy cookies first and foremost,” Rose said. “They want that one-to-one identity where it’s available.” One of InMobi’s latest directions was to move more aggressively into mobile web, selling programmatic ad inventory on mobile browsers. For InMobi, that was a sign that open web advertising is still a key area, especially for brands that are looking for as much ad reach as possible, Rose said. Programmatic is a crucial piece of digital ad markets, and open web display advertising is a core part of the programmatic markets, according to IAB, the industry trade group. Internet advertising was a $225 billion market in the U.S. in 2023, up 7.3% year over year, according to IAB’s advertising revenue report from earlier this year. In 2023, programmatic advertising, as a segment of overall internet advertising, accounted for $114.2 billion in revenue, up 4.4% year over year, according to IAB. Meanwhile, display advertising, the banners and rectangular ad units on websites, generated $66.1 billion in 2023, a 4% increase year over year, a greater moneymaker than social media, retail media, audio and online video. However, display advertising growth is slower than all the other segments. Without cookies on desktop, trackers on mobile or alternative identifiers, the wheels of programmatic are squeaky. “When you reduce the scale of identifiers by 60% or 70%,” Rose said, “it’s much harder to get the scale of observation you need to get statistically significant results right.” Ad Age Leading National Advertisers 2024 U.S. ad spending, rankings, analysis and profiles for the biggest marketers Click here How can brands prepare for post-cookie advertising? “Most brands, instead of cookies, are looking at how they activate their first-party data,” said Andrea Kerr Redniss, managing director at consultancy MediaLink and partner at talent firm UTA, “which then becomes a tech conversation about [how brands] are using clean rooms. What tech are you using, how are you doing that and then, who's actioning it?” First-party data, which is the information brands collect on their own and with permission from consumers, is increasingly important to activating ad campaigns. First-party data can help target ads across ad tech pipes and it helps build models for measurement. Brands are using their owned and operated properties, such as websites, to collect data, and ad campaigns can be a source of consumer information. “One thing every CMO should have is a one-sheet map of every partner they’re working with and what does it do,” Redniss said, adding that chief marketers need to understand the usability of their data and “what role does every group play in the overall landscape of their tech stack.” Also read: Clarity in the tech stack is needed now more than ever because brands are sometimes collecting ad tech partners without knowing their value, Redniss said. Some brands are even going back to the drawing board, turning off extraneous ad tech and resorting to purely contextual advertising. Then marketers can compare advertising with all the data components to advertising without it. “Let’s just do all contextual marketing for a period of time and see where that is,” Redniss said, “and cut out all of these additional costs and structures.” How are publishers reacting to post-cookie advertising? Publishers also have to get a better grip on their audiences and understand their readers to package them for brands. The Daily Mail, which is based in the U.K. but has operations in the U.S., including a New York ad sales team, is taking a strategy that many online publishers are taking by encouraging sign-ups to its site. The publisher is building a Daily Mail “plus” offering that could induce more readers to log-in through emails, which would help with one-to-one ad targeting and measurement, said Jeremy Gan, senior VP of revenue operations and data strategy at Daily Mail. “Once you have that email, then you have a lot more options to work on these partnerships that will be beneficial to our monetization,” Gan said. Like advertisers, publishers also are pushing into social media walled gardens. Of course, publishers have for years tried to figure out how to monetize Meta, which owns Facebook and Instagram, and YouTube, but now TikTok is growing in importance. Even when publishers don’t own the direct relationship with viewers on social media, they can still create direct ad deals with brands that run in the apps. “We’re doing tremendous work with some of the social media platforms out there,” Gan said. “We went largest on TikTok, and that opened new avenues for us, especially for our direct sales team.” Also read: Meanwhile, even though Google’s Privacy Sandbox stalled for the latter part of the year, development for post-cookie advertising is still a priority, Gan said. Just this month, Microsoft rolled out a new application-programming interface, API, in its ad platform that runs on the Edge browser, which is like Privacy Sandbox. Microsoft’s move showed that work continues on programmatic alternatives to cookies. “That brings us to a point where there's some level of interoperability,” Gan said, referring to more browsers adopting these privacy-centric designs. What’s new in ad tech? Ad tech has not stayed stagnant despite Google’s cookies reprieve. There is still a proliferation of alternative identifiers, which include LiveRamp’s RampID, Yahoo’s ConnectID, The Trade Desk’s Unified ID 2.0 and others. “Across these different universal IDs, there’s probably six IDs right now that all have some decent penetration in [online advertising] bids,” said Ben Smith, VP of product and data products at ad tech platform Infillion. “DSPs and media platforms need to basically work with all of them right now.” Also read: The IDs act as connectors that match the data to consumers when they are logged into a website, but not all consumers are able to be matched. That’s where the ad tech companies, such as the supply-side platforms that sell publisher inventory in programmatic markets, are coming up with new ways to connect identities across the web. “What we’re seeing is a number of brands and agencies that are testing these different cookie-less IDs for reach and attribution,” Smith said. “I don’t think that the smart move is to have a single ID that you’re exclusively working with your DSP to use. You want to work with a solution that’s agnostic to all these different cookies ID types. That’s really the only way that you’re going to get the reach that you want.” Some supply-side platforms are developing “synthetic cookies,” a type of alternative identifier that uses probabilistic data and mimics cookies, InMobi’s Rose said. “They want that one-to-one identity where it’s available,” Rose said, “they will also buy synthetic cookies at scale, basically server-side cookies, in environments where the third-party cookie can’t be dropped in the browser.” Read about Amazon’s foray into alternative identifiers There is another tactic that is emerging to improve reach, however, called “ID bridging.” That is when a supply-side partner does not have the exact ID to match an online consumer to the advertising side, but with some inferences, the SSP can make an informed guess to make a match. The practice of ID bridging has been a source of contention in ad tech, with advertisers and their ad tech partners worried that the matching is illusory. The industry, through groups such as IAB, is trying to formalize standards for ID bridging so that both sides of the exchange can be confident in the results. “Folks in the space recognize that what matters to buyers is transparency,” InMobi’s Rose said. “If you are going to bridge an ID, be clear about the fact.” Also read: YouTube faces uproar over poorly placed ads Curation is another ad tech strategy that is gaining prominence. That’s when a supply-side platform finds ripe targeting opportunities across publishers and packages them for advertisers. The practice took off partly in reaction to “made for advertising” websites—MFAs—which confounded the ad industry with junky inventory. Curation is a way to get scale, according to ad tech experts. Curation also is a way for publishers to juice their ad revenue, but only when it’s not offloading ad space at rates lower than the publisher could get otherwise, Daily Mail’s Gan said. “SSPs have opted in publishers into all these curated deals,” Gan said, adding, “it’s a great thing. It’s more demand. However, if it’s below your floor prices, you can create a channel conflict.” How walled gardens are evolving with cookie deprecation While the open web is sorting its identity issues, the walled gardens continue to thrive. Meta’s Facebook and Instagram, TikTok, Snap, Pinterest and others are running closed-loop ad offerings, with direct access to the identities of the consumers. The platforms were still affected by signal loss, especially after Apple prevented tracking on iPhones in earnest in 2021, but they have evolved their offerings. Brands and their ad tech partners can connect directly with the walled gardens through conversions APIs or CAPIs (application programming interfaces that measure conversions) to do measurement, for instance. Also read: Reddit is an example of a platform that is pursuing the walled garden approach. Reddit used to sell ad inventory in open web programmatic exchanges, before taking over all its sales. Reddit is one of the internet properties in the social media landscape that still allows non-logged-in users to scroll its site, whereas apps such as Instagram and Pinterest prevent non-subscribers from viewing content. “Part of why we chose right now to be in control of our own inventory is because we’re really focused on the importance of the signal that the community indicates,” said Mary Ann Belliveau, Reddit’s VP of North America large customer sales. “We have a really different kind of signal when you think about contextual advertising, because people talk about everything from knitting to woodworking to cars to parenting to refrigerators to education to so many different things.” Reddit also is building the ad tech like the other walled gardens, including a conversion API and direct-matching tools for brands to bring first party data to find consumers on the site. “There’s the targeting piece and there’s also the measurement piece,” said Jim Squires, Reddit’s executive VP of business marketing and growth. “One important piece is about shifting to conversions API, the CAPI integrations, is a key thing.” Why brands are wary of walled gardens The walled gardens are providing one-stop shops for advertising, but brands are reluctant to cede all power to them. One drawback is that they are increasingly automating the advertising through AI and machine learning, which takes some of the control from the brands and agencies that want to manage campaigns more directly. There also are challenges measuring across walled gardens. “Brands are looking for transparency with their data and leaning towards media partners that can help enhance their knowledge of their consumers,” said MediaLink’s Redniss. The open web will continue to be an alternative to the walled gardens, according to marketers. “I don’t believe the open web is dead,” Criteo’s Mitchell said. “I believe it will change the way that advertisers think about the open internet and the way they think about the performance needs to be altered. And that’s really kind of the angle that all of these strategies that we’re talking about today lead us to.”

Google and post-cookie ad tech trends—everything marketers and publishers need to know

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