Third-party
cookies are going away as Google says it will phase out cookies on Chrome browsers by 2022 and a growing number of digital publishers have pledged to do the same. That poses some challenges for advertisers who have come to rely on the small text files, given ID tags and stored in a computer's browser directory or program data subfolders, to track and target consumers’ online behavior. It has implications for digital audio, too.
“On the publisher side, it is a massive deal, and it is making the whole industry reexamine how we go about our measurement, targeting, validate the audiences that we are reaching, and make sure our advertising works,” said Sona Cederquist, Head of Measurement at Pandora. “As marketers, we know the digital industry is constantly shifting and this is one more bump in the road and we’re confident that we’ll be able to make changes as the industry shifts and continue to provide value to our advertisers in the form of data insights and ROI analysis.”
Cederquist told a Kantar Media webinar last week that it has led Pandora to work more closely with its vendors who have stronger capabilities for data collection that will continue to exist in a post-cookie world. “We’re also thinking a lot more about probabilistic identifiers like IP and user agents and whether this is something we can use and then validate those across our measurement partners,” said Cederquist.
Lex Friedman, Chief Revenue Officer at the podcast monetization company Art19, thinks other digital media could learn a thing or two from podcasters. “The reality is we have always been cookie-free. We have long hoped we could use cookies, but it has never been an option, so this evolution isn’t scary on the podcasting side,” he said. “It started operating like old school radio or TV ads where you relied on offer codes and vanity URLs, and hope.” Friedman explained that even without cookies, podcasters have been able to help advertisers target listeners using household IP data and various demographic information. “We still built a very robust and continually growing advertising business by finding other ways to help advertisers thoughtfully target better,” he said.
Kantar Chief Digital Officer Stephen DiMarco said what has helped podcasting grow into a “very effective advertising medium” is a combination of great content with a relatively uncluttered ad environment. He thinks the move away from cookies could even benefit the entire podcast industry.
Some advertisers are already moving beyond cookies. Nestle Communications Insights Manager Emily Weishaupt said they have been putting more focus on retailers’ media capabilities to leverage the depth of their consumer profile data. Yet she also conceded there is some trepidation among marketers.
“There is a little bit, but it is still a win for marketers. It’s making us revisit measurement methodologies and require transparency,” said Weishaupt. “Being less micro-targeted is allowing us to revisit that consumer obsession – who are our customers, how are they consuming media, and then developing those creatives that resonate and engage with them without micro-targeting.”
Fortunately, some publishers do not need cookies for consent, according to Kantar’s DiMarco. Registration-based users are already providing tracking information.
That could benefit streaming audio services that require or request registration information from users. For example, Pandora’s 59 million monthly users needed to supply basic demographic data to use the app. But Cederquist said that does not mean they will be immune.
“When this news first hit us, we thought this was going to set us backwards and we would not be able to serve the industry in the way that we want. Ultimately, this is forcing us to pivot and think about the way we measure and are able to identify audiences. I think a hybrid approach will make sense,” said Cederquist. “Marketers are also looking to expand their relationships with data management platforms and rely on those for targeting for reach and frequency and creating audience segments. But we’ll have to pivot our expectations.”
DiMarco, however, thinks it is “presumptuous” to conclude ROI will decline. He said there are many elements that factor into the effectiveness of an advertising campaign. “We are going to quickly come up with metrics to measure that instill confidence in the industry,” he said.
Friedman predicted it will make digital ads more like radio or television, where planners rely on probabilistic measurement and sampling to determine where and how to buy. He also thinks advertisers will need to put more trust in a media company’s first-party data.
“Everybody is going to end up using what they have access to, because they don’t have any other choice,” said Friedman. “I don’t have any concern about people just walking away.”