4 alternatives to cookies and device IDs for marketers

How companies identify and market to audiences across the digital landscape is undergoing a fundamental transformation. We’re not just talking about one of those back-end technical issues that the ad tech community needs to solve. We’re talking about a sea change that has implications for every brand and agency marketer on the planet as we enter a privacy-first world.

By now, the headlines are familiar: Google is discontinuing support for third-party cookies on Chrome. Apple has deprecated its IDFA with iOS 14.5. But that’s just the beginning.

Today’s advertisers need to be seeking alternatives in a world without cookies and device IDs. Unfortunately, there’s no single turnkey replacement forthcoming — but that doesn’t mean advertisers are powerless. Here are a few key areas where your future-proofing efforts should be focused.

1. Cohorts

The term “cohorts” has shot to the top of 2021 industry buzzwords thanks to Google’s Federated Learning of Cohorts (FLoC), but the concept of grouping people based on similar interests isn’t a new one. Right now, Apple and a handful of other providers are also developing new cohort-based solutions for targeting that eliminate the need for individual targeting and the related privacy concerns.

Google has received plenty of criticism for its plans around FLoC, but the overall approach — clustering large groups of people with similar interests together in a way that they remain anonymized — has validity. Today’s advertisers need to be seeking partners that are collaborating and integrating with tech companies to take advantage of emerging cohort-based audience options.

2. Universal identifiers

Even as Google and Apple are deprecating long-relied-upon web and mobile identifiers, a host of companies are racing to provide alternatives in a privacy-compliant way. The resulting universal identifiers — from companies including ID5, LiveRamp, Zeotap, and The Trade Desk (UID 2.0) — offer an interoperable way of tracking users, independent of a tech provider. The advantage of these IDs is that user consent and opt-outs can be managed in a streamlined, transparent fashion. More importantly, universal IDs provide a much cleaner solution compared to cookies, eliminating the need for continuous syncing between the ad tech platforms to be able to trade, while at the same time adding another friction point for the user (i.e., providing their email address).

Although Google has said it will not support these solutions in the Chrome browser, platforms (including The Trade Desk) are confident that these solutions will remain available to buyers. In general, universal IDs represent a viable, privacy-focused alternative to cookies — and one that will be particularly important on the open web. From an advertiser standpoint, the key is to embrace a “yes, and” mentality versus an “either, or” stance. By working with partners that integrate with all leading universal ID providers, advertisers can ensure the broadest continued coverage following the final death knell of the cookie.

3. On-device solutions

As advertisers look to offset the impact of the move to a cookieless world, it’s also important to be covering their bases on mobile. Going forward, “limit ad tracking” will become the new normal in mobile environments. In fact, only 10-20% of users are expected to opt in to ad tracking with Apple’s IDFA enforcement. As such, advertisers will see a significant impact as it relates to opportunities for one-to-one personalization and reaching consumers at scale, not to mention ad pacing, rotation, and forecasting.

This is where on-device audience solutions come in. The in-app environment combines the best of data and privacy through on-device audiences, a privacy-focused solution that doesn’t rely on mobile device identifiers. Rather, on-device audiences can be generated on the device, and only the audience segments — not the individuals themselves — are available for targeting. Ultimately, the user data never leaves the device. Such solutions can layer device data, app metadata, and advertisement interactions to probabilistically infer behavioral characteristics, such as age groups, gender, interests, and many more, without the need to access personal information such as a mobile device identifier. This approach will become increasingly relevant for mobile advertising, particularly given that Google is expected to follow in Apple’s footsteps and eventually deprecate its mobile device ID (GAID) as well.

4. Contextual targeting

Finally, let’s not forget that our industry has long had the means of targeting ads without the need for personally identifiable information (PII). We’re talking, of course, about contextual targeting, which is understandably gaining traction again as we move into a privacy-first world. The beauty of contextual targeting is that it does not require consent and works across all environments (e.g., desktop, mobile, CTV, etc.). Contextual audiences are built based on the type of media or subject matter that a user consumes digitally, versus the user’s identity. Advances in data processing and machine learning allow for real-time audience generation and activation based on such signals. In other words, the effectiveness of contextual targeting is improving every day.

Adapting (and measuring) for the future

As we move forward into a very different future for marketers, there’s a need to get back to basics when it comes to how we understand the effectiveness of advertising spend. Our industry’s overreliance on deterministic data is going to need to broaden towards thoughtful probabilistic measurement strategies. The good news is that these techniques, designed to help marketers understand incrementality in a cross-channel reality, are well-established. Going forward, strong media mix modelling will become essential and will ultimately elevate our industry’s omnichannel understanding in ways that today’s last-click tendencies do not.

The writing has been on the wall for third-party cookies for years now, and mobile identifiers like the IDFA have already lost a great deal of relevance and reach within today’s targeting landscape. The challenges to identity across the digital and mobile landscapes will continue to escalate. Mobile marketing will become less one-to-one in a privacy-first world, and strong omnichannel marketing strategies will become more important than ever.

What’s required of marketers at this juncture is a reset of their strategic mindset and a tactical pivot on multiple fronts. Now is not the time to be seeking simple solutions to systemic challenges. Rather, now is the time to be implementing a broad array of alternatives to see what works best — and committing to an ongoing test-and-learn loop for the foreseeable future.

Ionut Ciobotaru is Chief Product Officer at Verve Group.