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InContext / An inside look at the business of digital content

Publishers: Have no fear of a cookieless future

January 27, 2020 | By Tyler Bishop, CMO – Ezoic @tylerbishop

In case you missed it, just about everyone has been predicting the death of 3rd-party cookies for almost a year. Now, Apple has closed loopholes with ITP 2.3. Mozilla, Brave, and Chrome have grossly restricted or eliminated the use of cookies. And Google has further committed to eliminating all 3rd-party cookies along with UA parameters within the next two years.

What’s more, the loopholes long used to circumvent these regulations are closing quickly and will likely be almost completely eliminated in the future. Even new ones that pop-up will likely be quickly snuffed out as these practices roll-out throughout the digital ecosystem.

For digital publishers, this raises a lot of questions. Isn’t the personalization provided by 3rd-party cookies better for advertisers? And, isn’t that what is required to maximize the value they are willing to pay publishers?

Revenue concerns

We’ve heard Google recently tout research that says personalized advertisements are more highly-valued than non-personalized contextual ads. That would seem to paint a bleak picture for publishers. However, keep in mind that Google is one of the few parties that can offer scaled first-party data and may be inclined to view this issue with bias.

With that being said, many still wonder that in a world without third-party targeting, how are publishers going to be able to deliver an audience to advertisers that are as valuable as the ones they’ve become used to? And at the end of the day, publishers want to know if they can make as much money as they were before from advertising.

Consider the source

Publishers need to take a step back and look at the premise of all this and ask, “Am I being manipulated by parties in the space to believe that I am going to lose value selling the exact same thing as I am today?”

The big change in the ecosystem will come to the third-party targeting system as a whole—and that’s an advertising system. The system being affected is largely going to be the programmatic one (buying and selling inventory using online systems, like Google Ad Manager). Publishers are simply leveraging the advertiser’s system to sell their inventory in an easy and cost-effective format.

This isn’t to say that publishers get to sit back and relax. In fact, publishers might have to find a new way to market that audience to the advertisers. However, if we look at the shifts in spending for advertisers, there’s no slowdown in digital ad spend. Given that spending is going up and your audience remains the same, publishers should have a fair amount of optimism.

Winners and losers

Google is already using cookieless tracking. The same can be said for many other major ad exchanges and ad networks. The advertising market has continued to grow and the money flows to the eyeballs, no matter what. When those eyeballs are on a TV ad for the Superbowl (obviously without cookies), the money flows there. That revenue is driven by the opportunity for advertisers to reach an audience they know is unique.

For advertisers, this is where they lose a little bit. They will have to work much harder in identifying what makes their audiences unique and where they can put their dollars to ensure they’re still able to capture them. This means trying new systems and methods.

In the realm of programmatic advertising, Google has the largest reach, a hold on the industry’s most effective tools, the most user data, and they’re incumbent at just about every layer of digital user experiences. It’s hard not to see them as the biggest winner in all of this.

Publishers’ position

The vast majority of the internet is potentially going to lose personalized cookie targeting. The good news is that publishers are more important than ever before. Your audience, your data, and the material relationship you have with them are more important than ever. And the value that comes along that is only poised to increase as time passes.

The only thing you should fear, given the death of 3rd-party cookies, are the players that will inevitably come out of the woodwork. They’ll tell you that the upcoming cookie changes are of reason why you need to pivot your strategy, need to leverage this company, or this third-party network, because they have great personal relationships with X network or Y direct advertisers.

Basically, they’ll say: Sell your audience to us and we’ll resell it to advertisers. It’s the only way to save your business. It’s in these players’ best interest to grow their first-party data and they need you to help them. Beware these pitches. Instead, rely on doing a good job of engaging with your audiences and understanding who they are.

My last piece of advice is this: Protect the relationship you have with your audience because it’s only going to get more valuable as time goes on.

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