Online Advertising in 2022

In this post, I will give my view on how the web could adapt to the Google decision to remove support for 3rd party cookies in 2022.
If you didn’t follow up on this, Google announced that their future Chrome browser will not support 3rd party cookies, but this change is not to come before 2 years.
Articles here, here and there.

3rd party cookies had bad reputation for some times now, Apple (with Safari) and Firefox were fighting against it, in the name of the privacy. The decision from Google is more impacting because Google is still relying a lot on 3rd party cookie for its advertising business and it is not limiting 3rd party cookies, like Apple and Firefox but completely remove them.

At the moment, most of the advanced performance marketing is done with the help of 3rd party cookies. They serve as bridges between what the advertiser know and what the publisher know. If you don’t know publisher and advertisers terminology, you may want to look at this article I made. Therefore, a big impact is to be expected on how ads are going to be distributed and bought.

Disclaimer
At the time of this article, nothing has been said by Google about the future of their Ad tech business. I am sure they have plan and they didn’t make this decision without some thoughts on the subject. I will need to assume some parts on their side, so I will go forward with that but new elements may come in the future that I am not aware at this time.

Impact of Advertising Business

By losing the 3rd party cookie, we will lose any way that we can share ID between the different providers. The 3rd party cookies were used in order to collect and create a user-profile for advertising and publishers.

The problem is that the website that are displaying the banners to the users may not know anything about these users, but they could rely on intermediary to get information, and these proxies are mostly using 3rd party cookies now. The DSP / Ad Network (info about them there) are these kinds of companies, some big companies are still today (2020) using these techniques to identify the users and bid to publish their Ads to the best profiles they have (Criteo, AdRoll, Google Remarketing).

Nowadays additional methods are being used to define if we know the users, they are mostly working through deterministic or probabilistic methods and are relying on statistics. They have their fair share of success but nothing could compare them to the cookie matching with 3rd party cookie.

Here is a (simple) schema to explain on how 3rd party cookies works / worked.

This is very simplify and other partners could integrate between the publishers and the advertisers. In the case shown above, it is very direct relationship but the 3rd party cookies can be used in order to sync between different partners.

Adobe has a DMP (Audience Manager) that enable to build audiences based on your website data and then share these audiences to other partners. It takes advantage of this 3rd party system with its demdex cookie, living on demdex.net domain. You just have to imagine multiple 3rd party cookies happening, not only between Advertising, Partners and Publishers but also between partners.

As you can see, the disappearing of 3rd party cookies will completely block the way that user data are collected and re-used between websites. Fortunately (for Google and Apple), they are not the only way.

Cookie is not the only way

I am very surprised that Google and Apple, which are very famous for defending the user-rights now, haven’t realized any comment on the Mobile Device ID that they are using for Mobile apps.

The Mobile world is not really working with cookies (it is possible but really limited to browsers apps). Each users possesses a Mobile Device ID (GAIQ for Google, IDFA for Apple) that the different apps can use in order to assign information and realize targeting very efficiently. In that sense, the decision from Google to disrupt 3rd party cookies will not impact this world, Apple crusade seems to forget this part of the world.
It is very surprising because the mobile usage is representing quite a lot of usage. From statista; 52% of the internet usage is done on mobile, it represents 77% of the digital minutes spend in 2019 in the US. The app share represents 89% of these minutes.

Someone should inform Apple (who is one of the leader on this platform) because their battle for online privacy seems to avoid that spot. I am sure the fact that Safari only represents 9% of the market share on desktop browser in 2020 has nothing to do with their intention to block 3rd party cookies on their browser. It is not a move to show themselves as white knight without lots of consequences and to reinforce their IDFA ID. I am sure it is not the case……………………………… (<— with that amount of dots, you should get the sarcasm).

Some are saying that the Mobile Device ID are the next target after the 3rd party cookies and they will soon be announced as deprecated. I personally doubt that, but if this is the case, then I will believe Apple a bit more on that part about privacy concern.

So you can see that there will still be a possibility to target profiled users on some platform, but what about the browser behavior ?

How the future of advertising could look like ?

This last part of the blog post will look at the different options available and how that would shape the advertising industry. This will be mostly focus on the browser advertising because the 3rd party cookies are mostly impacting this part of the business.

Browser ID

The first hypothesis is that the same way than a Mobile Device ID, Apple and Google will create a browser ID that will be helping the advertising industry to survive this change. This will, of course, need to be shown as a way to identify browser behavior. The way that this change can be introduced needs to happen in a timely fashion so no one gets accused of bypassing cookie limitation in disguise.

This would be the easiest way to keep the old system working and the same actors to survive this change.
I am not so sure that this will be the best option for the main actors because it won’t increase the business or power from Google or Apple, by keeping 3rd party cookies relying vendors into business.
I classify Firefox differently because it is not own by a major business company, whom sole purpose is to make more money each year.

Publisher Platforms thirst for data

My main take on this change is that it will mostly kill the performance marketing as it is being used at the moment. The DMP or Retargeting Platform will have hard time to survive the business on the browser. You can always use DSP or Ad Network but in a old-fashioned way, buying impressions but without much context.
Mobile Device is not impacted in the same way and the companies may keep working the old way through the Mobile Device ID.

The problem is that some marketing budget / executives need to be convinced to keep investing money on some Ad platforms. I feel that most of the companies started to get used to the power of online advertising, the user profile tracking power that was in place made it a quite powerful and important medium.
Keep investing the same amount of money without any warranty on the user profile you are targeting is a risky move. Your marketing campaigns that were performing well may plumber because you lack this capability to target the right user.

One of the possibility is that big publishers will need to invest in data. By that, I mean that they really invest on understanding their users, what kind of demographic they are, what system are they using, what kind of behavior are they doing.
It will be an easier move for large publisher websites where the amount of data is substantial.
They can show their data to the “money people” (Advertising guys) and convince them that they can deliver their content to the right persons based not on the advertising data but on their own data.

We can imagine that big Publishers will develop tools that allow advertising to create audiences on the their own data (anonymizing the users and the data).
That would a revolution to know so much of the publisher audiences but it would be the best way to convince the advertiser to spend their money.

Cat and mouse game

The same way that the ITP policies of Apple (blocking 3rd party cookies or requests) is creating a game between them and the advertising industry. Maybe the Advertiser will find a way to bypass the limitation. I am not smart enough to imagine a complete solution but I can give some ideas to solve tracking on the publisher side.

If the publisher creates a tool where the advertiser can target the publisher users, we can imagine that a tracking parameter can pass the User ID to the advertiser websites when the user click on the ad. Advertiser would store the publisher user id inside a 1st party cookie.
Thanks to normal tracking (using GET requests) you can then send data to the publisher platform and re-target the user inside that publisher platform.

That would better work with large publishers because you need to have a real possibility to see the user again on the same platform. Also it would be optimal that the publisher user id would be different for each advertiser.
So publishers can become a mini DMP, for a single domain, a SDDMP in a sort (Single Domain Data Management Platform).

News website can have an interest for creating this kind of platform but also big publisher platform such as Google…. Reinforcing their powers.

Summary

Everything I described above can happen, as well as no one is doing anything and we come back to buy impressions without much info, the way it is done in print.
It will mostly depend how much the advertising industry will be demanding.

Overall Google and Apple are trying to kill the middle men and take even more power on the Ad industry, through their advantageous positions on Mobile (Apple) or their large publishing audiences (Google).
The GDPR law was already increasing their power, now they try to give the final blow.

I hope this gave you a view on how the online world will look like in the future. If you have any comment or ideas, anything that I missed, as always don’t hesitate.

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