The cookie apocalypse is upon us, so let’s recap the following four verities:
- Cookie-based tactics are out.
- Relevant advertising is still in and necessary to preserve a free internet.
- CTV is now a mainstay in programmatic media budgets.
- Advertisers who are under economic pressure need to start achieving better KPIs with smaller budgets.
You got this?
The year 2024 is poised to see the biggest changes in advertising since programmatic advertising’s inception. According to Proximic by Comscore’s 2024 State of Programmatic report, 30% of marketers do not feel their organizations are ready for a cookieless advertising world (and, IMHO, the other 70% are kidding themselves).
So if marketers are expected to deliver relevant cross-platform messaging in a more fragmented ad ecosystem with only a fraction of the tools they’ve become accustomed to, how do they exit the paralysis stage and move forward?
It would help to study the ghosts of programmatic past. Before there were over 400 data providers bringing thousands of audience segments to programmatic buying platforms, advertisers relied primarily on data that was twofold—their own first-party data plus inclusion/exclusion lists. Each of these data sources had arguments for and against them.
Reaching beyond owned data to achieve scale
First-party data was (and still is) gold, but is often limited in scale and scope. Advertisers have varying access to first-party data, so while an e-commerce retailers' data may be extensive, CPG, auto and pharma advertisers may have more limited direct data sets. Furthermore, even for those with scaled user bases, their visibility only extends to their own virtual four walls, with limited understanding of a consumer’s holistic behaviors.
This was one driver of the reliance on third-party cookies in the first place, because consumers are more than just the tiny snapshot seen by any one advertiser. If the goal is relevant cross-platform touchpoints, then single, myopic views are insufficient.
Contextual’s rise began mainly to protect brand safety and keyword targeting to achieve contextual relevance. However, those tactics quickly became stale. Blunt objects like inclusion and exclusion lists negated the cost- and reach-optimizations that programmatic afforded. Contextual relevancy is important, but so is dynamism. A path forward cannot be reliant on a step back in optimization.
So where do we go from here? How do we learn from the past and take the best of what has worked while respecting consumer privacy?
Proximic’s State of Programmatic reports that 78% of advertisers plan to increase or maintain reliance on contextual targeting in 2024. And while 45% of advertisers plan to rely on first-party data to combat signal loss, a near-equal 42% plan to heavily rely on contextual targeting to fill that gap, far ahead of alternative IDs at 14%. However, basic contextual targeting tactics like inclusion lists and keyword targeting will be insufficient to effectively combat signal loss.
Taking contextual to new levels
With the help of AI and opt-in privacy-friendly data assets, we now have the power to combine contextual signals with audience attributes. The concept of a contextual audience bridges the benefits of holistic audience behaviors and aligns those behaviors with contextual attributes, resulting in segments free of any user identifier.
Achieving contextual relevance and reach based on audience behaviors has a better likelihood of achieving relevant cross-platform messaging than either tactic alone. Originally, the concept of a contextual audience was viewed as a diluted version of its cookie-based predecessor, but that couldn’t be further from the truth.
Consider the experience of IBM, which tasked its dedicated agency EightBar to find the most-effective targeting to drive video campaign performance, evaluating ID-based and ID-free tactics. Proximic by Comscore and Eyeota partnered to create contextual audiences which outperformed all targeting tactics. These predictive audiences achieved a 46% lower cost per engaged visit (CPEV) compared with other ID-based third-party audiences, and a 23% lower CPEV compared with other standard contextual segments. It is with the marriage of contextual relevance and audience attributes where campaigns can consistently outperform the cookie-based solutions of the past.
Maybe the industry pain caused by the deprecation of third-party cookies is coaxing us into better solutions than would have been realized otherwise. Maybe we now can exceed KPIs and respect the consumer. Maybe the innovation of contextual audiences was the right answer all along.
