While cookie deprecation threatens to upend the digital advertising economy next year, ad buyers are still taking a relaxed approach to test audience targeting alternatives.
During 2023 and late 2022, ad buyers’ efforts to test alternative IDs have lacked momentum, six ad-tech and publisher sources told Adweek.
“From the sell side perspective, nobody seems to be actually buying on these unique user IDs,” said a publisher ad-tech source, who wasn’t authorized to speak to the press. “There is a lot of talk of setting this up. The buy-side doesn’t seem to be buying on it.”
Supply-side platform Magnite has seen few buyers ask to set up private marketplace deals using alternative IDs in the past few months, compared to somewhat regular asks earlier in 2022 and in 2021, according to Garrett McGrath, Magnite’s svp of product management.
“The lion-share of web transactions happen on Chrome and third-party cookies are still there,” McGrath said.
Demand-side platform RTB House was running a few large-scale campaigns using alternative identifiers prior to Black Friday in 2022, which paused and weren’t relaunched. This was mainly due to economic headwinds, said Mateusz Ruminski, private advertising ecosystem go-to-market lead at RTB House, which still has run smaller campaigns with alternative IDs.
“We see that advertisers are more willing to rely on trusted and well-known technologies in these difficult times,” Ruminski said.
Agency interest in future-proofing has increased
Sources attributed the buy-side’s decreased emphasis on testing alternative IDs on a number of factors, such as economic headwinds, Google’s July 2022 announcement delaying the cookie deprecation deadline by a year, challenges isolating alternative IDs results, plus the existence of cookies still swirling in the bidstream.
Testing has also lagged on Google Privacy Sandbox paradigm Fledge, a different process to cookies, though not an alternative identifier.
Some sources contested that there has been a slowdown in testing in recent months, though acknowledged there is still not enough evidence to know the identity landscape of the future.
The Trade Desk’s UID2 team is busier than ever, with a large percentage of its advertisers using UID2, the DSP’s cookie alternative solution, according to The Trade Desk’s director of product management Kanishk Prasad.
The amount of inefficiency in the supply path does cause problems for a publisher to figure [out] how this works.
Kanishk Prasad, director of product management, The Trade Desk
Another progress point is that 70% of brands working with data platform LiveRamp buy on RampID or with direct publisher integrations, with no reliance on third-party cookies, said Travis Clinger, LiveRamp’s svp of activations and addressability.
While advertisers aren’t consistently testing alternative IDs themselves, they want to make sure their ad-tech partners are prepared for cookie deprecation. Two-thirds of the requests for information received by SSP OpenX from agencies in North America include questions about cookie deprecation and future-proofing, compared to less than half of the RFIs the previous year, according to OpenX svp of product Mike Chowla.
While agencies have asked about OpenX’s plans for cookie deprecation in the past, the level of granularity this year is more intense than years prior, Chowla added.
For example, agencies are asking for signal deprecation assessments by brand and how the company works with proposals like Fledge. Agencies are also more frequently asking what identifiers and signals their platform supports and how these alternative identifiers perform on CPMs, CPAs, reach and measurement, Chowla said.
Challenges in measuring the impact of alternative IDs
The industry is looking to understand the efficacy of various alternative identifiers, but measurement is elusive.
Publishers don’t often get visibility over why DSPs choose to bid on their inventory, making it hard to ascertain if the presence of an alternative identifier factored into the buyer’s decision, especially given the limited scale of these solutions.
“I don’t think there is enough spend that [impacts] are going to stand up and be really obvious unless you have a rigorous methodology to see it,” said Mike O’Sullivan, co-founder of currency platform Sincera. “There is usage, but I also agree there isn’t enough usage to really make it obvious the benefits it’s driving.”
Isolating impacts on the sell side is further complicated by the convoluted ad-tech supply chain, said The Trade Desk’s Prasad.
“The amount of inefficiency in the supply path … from a publisher to a buyer does cause problems for a publisher to figure [out] how did this work,” he said.
However, Prasad noted that buyers could fairly easily isolate the effects of an alternative ID versus the impact of cookies during the attribution process.
Still, when buyers test alternative IDs in the open exchange on Chrome, they are never turning off cookies to see the isolated impact of the alternative identifier in the bidstream, several sources said, making it hard to truly understand what a cookieless future would look like.
“If you have just an identifier in the wild and you want to know, in the absence of the third-party cookie, how well this performs as an alternative identifier, you need a DSP to read that ID and use it to make a bidding decision,” McGrath said.
“Generally, the only places you can do that is in Safari and Firefox,” he added. “If you’re testing Chrome-based audiences, the request also contains a third-party cookie. Only the DSP can tell you what their algorithm is doing to make the bidding decision.”
