Pivoting to privacy-first: Why this is an adapt-or-die moment

Operating in the digital advertising ecosystem isn’t for the faint of heart, and that’s never been truer than it is in 2021. The landscape is undergoing unprecedented transitions right now as we make a much-needed pivot to a privacy-first reality, and a lot of business models, practices, and technologies are not going to survive the upheaval. That said, I’m not here to make doomsday predictions. In fact, there are a lot of reasons for genuine optimism right now.

As an industry, we’re heading in the right direction, and when we emerge on the other side of important transitions — including Google’s removal of third-party cookie support in Chrome and Apple’s limitations on IDFA — our industry will be stronger as a whole, as will consumer protections. Let’s take a look at the principles that will define the digital advertising and marketing world of the future, as well as the players that operate within it.

To win, you have to embrace industry change

Google gave the industry more than two years’ warning of its plans to end third-party cookie support on Chrome in 2022. Since then, a number of companies and industry organizations have rolled up their sleeves and started planning for what has long been an inevitability. Those that leaned into the conversation, digesting Google’s position and anticipating how the cookieless future would look, weren’t surprised when Google clarified in March 2021 that it isn’t planning to build or use alternate identifiers within its ecosystem.

The simple fact is that burying your head in the sand or digging your heels in as it relates to changes of this magnitude isn’t an option. Industry consternation, and even legal pushbacks, might delay implementation of certain policy shifts, but that’s all they will do — delay the inevitable. The writing is on the wall: Greater privacy controls are coming to the digital landscape, and the companies that succeed in the future will be the ones that embrace — and even help to accelerate — this transition.

Don’t put all your eggs into one basket

If the panic that followed Google’s cookieless announcement taught us anything, it should have been this: The digital marketing ecosystem can’t allow itself to become overly reliant on any single technology or provider. The future belongs to those that put interoperability at the heart of their approach.

Moving forward from the cookie, there are a few truths we must recognize. One is that there’s no single universal identifier that’s going to step forward to fill the entirety of the void left by third-party cookies. A number of companies are moving forward with plans for their own universal identifiers, and taken together, these identifiers will help to illuminate user identity on a portion of the open web (i.e., non-Google properties). They will be an important part of the ecosystem but by no means a silver bullet to comprehensive cross-channel, personalized advertising.

Another massive component of the post-cookie landscape will be behavioral cohorts, embodied most prominently in Google’s Federated Learning of Cohorts (FLoC) construct. Through FLoC, Google will be creating targetable groups of anonymous users who navigate the internet in similar ways. The good news is that, through FLoC, nearly all of Chrome’s users will become addressable in a fully private manner, whereas only a portion of them were addressable via cookies. As such, marketers and their partners will need to build solutions that accommodate FLoC and other cohort-driven approaches. But at the same time, they also need to look beyond what Google’s putting into the marketplace in order to continue effective cross-channel marketing and personalization across the broader landscape.

Ultimately, companies that can bring their own ground truth of consumer understanding to the table — and then extend their insights through the most important identifiers and behavioral cohort solutions — will prove the most adaptable to future marketplace shifts. The time of putting all your digital eggs into one ecosystem basket are long gone.

An always-on crystal ball

The next 12 months are going to be transformative in our industry. In 24 months, we’ll all be a lot wiser. We will have taken universal IDs and behavioral cohorts for a few laps around the track, and we’ll have a much stronger sense of the role that they can and will play in furthering our consumer connections and understanding. Likewise, the innovators of our industry will have gotten to work on rewriting the internet economy around the new privacy-first reality, and we’ll all be reaping the benefits of their novel ideas and solutions.

Along the way, of course, we will see a lot of companies pivoting. This might be a period of rapid transformation, but there’s no reason to believe a period of stagnation awaits us on the other side. The future, as always, belongs to the nimble — the ones that anticipate and adapt while others resist. Now is the time to be fearless in building the future of our industry in a way that is sustainable for companies and consumers alike.

Tom Craig is CTO at Resonate.

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