WINNERS, LOSERS, & OPPORTUNITIES IN A COOKIELESS WORLD

By Muhammed Sayed

When Google announced it would be phasing out third-party cookies from Chrome -- the most widely used browser in the world -- by 2022, it left agencies and trading desks scrambling to figure out what the hell that means for their clients’ ad campaigns. With Safari and Firefox already blocking them by default, advertisers know one thing for certain: the way we buy ads is about to transform drastically.

Change is definitely in the air, and the experts here at Peloton Media have identified our biggest winners and losers (as it stands) of Google’s announcement, and the imminent transformation of the digital landscape.

Winner: Publishers

The disappearance of third-party data will be a huge boon for publishers, who will become one of few reliable sources of quality data about consumers.

We’re already seeing an increased demand for private marketplace deals between advertisers and publishers, and it’s going to grow exponentially over the next two years as the latter capitalize on their first-party data.

There are also whispers of publishers teaming together to create their own “walled gardens”, using authentication and registration strategies to create shared pools of anonymised first-party consumer data.

Winner: Walled Gardens

As if the existing Facebook-Google duopoly wasn’t disconcerting enough, the expected rush for more first-party data will further benefit the platform companies that happen to own most of it: Facebook, Google, and to a lesser extent, Amazon.

As walled gardens, these companies act as one-stop shops for advertisers, with inventory, audiences (based on their own first-party data) and measurement all managed within their platforms. Non-reliant on third-party cookies by design, these platforms have little to fear and everything to gain from the incoming paradigm shift.

Loser: Third-Party Data Providers

The players taking the biggest hits are those who’ve built their entire business models around selling data collected using third-party cookies.

Companies like BlueKai, Lotame, and Datalogix are household names in the programmatic space, building their reputations by selling niche audience data to advertisers. Without their primary means of collecting consumer data, however, they aren’t likely to be relevant players much longer -- not unless they pivot to other data sources.

The most natural transition would be to shift focus on to mobile device IDs (unique to each Apple or Android device, and generally more reliable than cookies.) That said, device IDs raise the same privacy concerns as cookies, andaren’t likely to outlast them by much.

Loser: The Open Exchange

There's a reason experienced marketers avoid relying too much on walled gardens. With little or no room for external partners to verify the efficacy of Google and Facebook’s ad platforms, advertisers are forced to take their words for it.

That was the big draw of buying ads programmatically on the open exchange: you could use one product to manage your campaign, a different one to target the right audience, and a third to measure results -- not to mention the plethora of ancillary tools that feed into programmatic ecosystem -- without needing to rely on a single source to determine how effective your ads were. Cookies are what made that level of accountability possible.

Last month, eMarketer projected that private marketplace spending would surpass the open exchange as early as this year -- and they crunched those numbers before Google made the Chrome announcement. Without third-party cookies, the open exchange is likely to lose much of its appeal.

There's one more winner that we saved for last, and that’s marketers -- but only the ones who are willing to adapt.

The industry is in a state of transition, and that presents an opportunity for marketers to pivot towards something better. The winners we talked about above all have one thing in common: they can leverage their first-party data. Marketers can do that too, if they team up with the right partners

Our vision here at Peloton Media is not to retreat to decades-old approaches to buying ads, or to lean on Facebook and Google because they seem like safe bets, but to help our clients embrace the change and take this opportunity to do things a better way -- leveraging their own first-party data as well as publishers’ to target audiences relevant to their business, and measure performance using KPIs that actually matter to their bottom line.