How The Death Of Digital IDs Will Reshape The Marketing Mix

Data-Driven Thinking” is written by members of the media community and contains fresh ideas on the digital revolution in media.

Today’s column is written by Ari Buchalter, CEO at Intersection.

The impending demise of the cookie, IDFA, and likely all 1-to-1 identifiers available to third parties will rewrite the rules across the entire media mix.

Our industry will surely invent new solutions to enable audience targeting and impact measurement, but those solutions aren’t going to entail the deterministic 1-to-1 targeting and measurement that have been the twin cornerstones upon which the digital advertising ecosystem was built.

New, scaled approaches to targeting and measurement will necessarily be statistical proxies that will work equally across both digital and traditional channels. For example, online contextual targeting is a proxy for audience because people consuming a certain type of website content tend to have certain characteristics. But context can also be defined by the apps people use, the shows they watch, the podcasts they listen to and the places they visit.

Similarly, attribution will no longer show which specific consumers who were exposed to an ad also converted, but rather will become a statistical exercise. Statistical attribution, whether done via consumer panels, market mix models or walled garden clean rooms, doesn’t just capture online ad exposure and conversion, but can ingest every media touchpoint and every type of outcome, from brand awareness to website visits, app downloads, in-store foot traffic or point-of-sale purchases.

None of the fastest-growing channels – CTV, audio and digital OOH – use cookies. But all enable audience-level targeting and attribution using the same or equivalent techniques that will soon become the norm in online and mobile advertising.

As targeting and measurement become democratized across channels, there will emerge four primary criteria that differentiate the advertising channels in a post-ID world: advertising scale, audience engagement, media cost and brand safety.

Advertising scale

Most channels tout their “massive scale,” but the true scales of different channels are rebalancing before our very eyes.

Traditional linear TV, once the king of reach, has suffered massive audience declines and fragmentation, while the subscription-based OTT services that are taking its place don’t offer comparable quantities of advertising opportunities, despite growing adoption. Meanwhile, subscription models are also proliferating in the online and audio spaces.

In a world of personalized, on-demand content, driving mass advertising reach is becoming harder, even as media consumption increases. Moreover, there are a host of other challenges to contend with, such as fraud (prevalent not only online, but also in mobile, CTV and audio).

Delivering true advertising scale will require advertisers to gain a more nuanced understanding of each channel’s ability to deliver reach and frequency of advertising against a valid audience, and build media plans that can deliver desired levels of scale across previously siloed channels.

Audience engagement

Reaching audiences is useless if the audience doesn’t notice the message and engage with the brand. Besides familiar challenges – viewability and ad blocking online, ad skipping on TV and small creative on mobile – the unchecked use of data in targeting has alienated consumers, who now see advertising as interruptive and annoying at best, to creepy and deceptive at worst. The resulting social and political backlash are the reasons why cookies and IDFAs are going away and GDPR and CCPA have come into being.

Defenders of online advertising often state that advertising supports a free internet. But that ad “tax” on free content is unfortunately exactly how consumers think of advertising – a necessary evil to be stomached (or blocked, skipped, or ignored) to get to content they really want.

That’s a weak foundation on which to build consumer trust, not to mention engagement. But research from sources such as PJ Solomon and MarketingSherpa has shown tremendous variation across media types when it comes to consumer recall, engagement and trust, with “traditional” media channels ranking highest.

Media cost

It’s hard to compare the cost of advertising because many channels have unique processes and metrics around planning and buying, and because some digital channels especially have limited transparency around true costs.

But most channels have the concept of an “impression” (an ad rendering to a human who had the opportunity to see it) and as media planning normalizes across channels, it will become easier to create plans that holistically drive reach and frequency against audiences across channels.

When that shift happens, apples-to-apples comparison of CPMs across channels will become possible, and buyers will see significant differences emerge between channels in the “cost per human reached with an ad” that are not readily apparent in the apples-to-oranges world of today.

Brand Safety

The dependence of advertising on the surrounding content generally means brands can become collateral damage when that content is negative, offensive, inappropriate or simply doesn’t align with the values of the brand.

While brand safety has long been a concern around online advertising, it is now vividly playing out in social media, where “hate-for-profit” concerns have led many advertisers to suspend advertising on large social media platforms.

However, there is a large variation in the levels of brand safety different channels offer brands, ranging from the wild west of UGC to highly-curated content to content-free advertising environments.

It won’t be long before the last cookie crumbs have blown away and mobile advertising IDs are a thing of the past.

The resulting democratization of targeting and measurement will require advertisers to gain a deeper understanding of how different channels measure up on these four dimensions. When they do, we are likely to see a redistribution of advertising budgets towards the channels that best serve the needs of brands.

Follow AdExchanger (@adexchanger) on Twitter.