Opinion: The future of online identity in 2021's post-cookie world
With third-party cookies on their way out, it is imperative for the industry to find new solutions that can take their place.
For years, cookies were the bedrock of traditional digital advertising. Marketers used them to stitch identity, improve the user experience and collect data that helped target ads to the right audiences. But with shifting consumer privacy preferences, changing legislation and leading web browsers phasing out third-party cookies, it’s becoming more challenging every day for advertisers and publishers to understand audiences and effectively engage with them in meaningful ways.
This shift happened at a time when people are spending more time online—behavior that has translated to a bigger digital representation in a customer’s identity, but coincides with growing concerns about consumer data privacy worldwide.
Now more than ever, marketers and publishers need a solution that can simultaneously bridge the identity gap and deliver meaningful revenue, while honoring privacy preferences and maintaining a relevant consumer experience. A more fundamental challenge is the sustainability of the “free web” that consumers have become accustomed to, which will be impacted severely if publishers aren’t able to maintain monetization.
With so much at stake, brands and marketers will have to move much faster if they don’t want to get left behind. A recent report finds nearly half of all marketers and publishers don’t have an identity solution in place. The industry has to urgently rethink how to move forward in a cookie-less future.
Globally, we’re seeing new thinking, with large players creating alternate approaches to solve for the lack of third-party cookies, including new identity solutions on the horizon. Here’s a look at the direction these solutions are taking towards identity resolution in a future without cookies.
The rise of trusted and meaningful connections
Advertisers have long relied on data and cookies to identify valuable audiences for their brand and provide relevant consumer experiences. Third-party solutions—in many cases powered through cookies—have historically delivered this, but at the expense of privacy concerns. As data and identity-building moves away from stealth and toward active, transparent information sharing, it’s even more crucial for brands and businesses to build a direct relationship and leverage first-party data to meaningfully engage audiences online.
Users aren’t necessarily averse to ads and sharing data—especially if these are tailored to their needs. This proves the need to strike a balance between providing relevant, targeted experiences and respecting privacy preferences and user information.
In short: if customers trust and connect with the brand, they would be more open to volunteering their data in exchange for an improved brand experience. Brands that provide users with real value will be able to entice them to help drive richer data, leading to relevant, individualized experiences. That said, while consumers demand personalized experiences, this also comes hand-in-hand with their expectation that brands need to respect their preferences and use data for good.
What’s next after the cookie? Emerging solutions
The divide is now sharper between the haves and the have-nots. First-party data walled ecosystems will be the haves with a slew of challenges cropping up for the have-nots. Brands and publishers who might possess only first-party data (cookies/device IDs) but do not collect personal information from logins will still need solutions that can offer scale and addressability while guaranteeing user privacy. Blind spots will increase, with advertisers forced to conduct measurement in silos depending on the channel or device they're activating, and never fully understand the customer journey or true ROAS.
In this landscape, players who have created an identity graph composed of owned, consent-based, cross-channel, first-party data will have the upper hand in providing marketers with a host of new and alternative identity, targeting and measurement solutions.
In the coming months, we are also likely to see more synergy and partnerships develop across the industry to take on walled gardens and ensure identity matching in cookie-less environments while safeguarding user privacy.
We’re looking at a world where open source and proprietary data will live side by side, with identity differentiated by direct consumer consent and association to many deterministic signals that can be shared in a privacy-centric way.
The next winning identity solution will need to be able to help advertisers effectively buy, measure and optimize ads while also enabling publishers to manage, monetize and navigate audiences. It needs to be a win-win for all sides, with consumers ultimately being able to enjoy free, ad-supported products and relevant ads.
Competition and change are key drivers for innovation and we expect to see more join the fray with the identity-race still up in the air—which will serve to push the industry forward in the quest for sustainable identity solutions in a people-first and privacy-centric world.