What 3rd Party Cookie Elimination Means for the Online Advertising Ecosystem
Written by Beth Walter, Sr. Product Manager – Digital Marketing
April 14, 2021
Last week, we reviewed the Importance of 1st Party Data and how to Effectively Use it. We looked at some of the new channels where this data can be utilized, like CTV/OTT, and we briefly touched on some of the audience size limitations and other technology that is needed, depending on the platform, like DMP’s.
This week, we are going to do a deep dive and look at what exactly is needed to run these campaigns on each platform, including the partner technologies that are often required, like Data Management Platforms (DMP’s) and Demand Side Platforms (DSP’s).
Let’s start with an overview of DMP’s and DSP’s, one of my favorite topics. This is particularly interesting in light of the changes that are happening now with the end of the 3rd Party Cookie.
The world before and after the end of the 3rd Party Cookie.
BEFORE
A Data Management Platform (DMP) is a software platform used to collect and manage data. The DMP allows any brand to upload their 1st Party customer data, stripped of all PII data (such as telephone numbers, email addresses, names, and so on). That data is then added into a bank with data from hundreds of other 3rd Party and Cookied data sources in the automotive world such as Polk, Experian, Oracle, etc. The data is combined to create custom audiences from multiple data sources that can be used for targeting. Examples of some of the most popular DMP’s include Adobe Audience Manager, LiveRamp and Oracle’s Blue Kai.
A Demand Side Platform (DSP) is a software platform used to access all of the ad exchanges out there, so once you have built your audience in your DMP, you can use your DSP to reach out and “find” that audience on an ad network, “bid on them” and buy impressions to reach them. Cookies also allowed DSP’s to report back to advertiser on the fact that someone in the selected audience had been reached and what actions they did or did not take.
Some DMP’s are DSP’s (hybrids) as well, they do both, which is really not important, the key thing to understand is what each of these “Ad Tech” tools does.
Now, let’s look at what these tools look like as more companies and websites remove cookies altogether, like Safari has done and Google plans to do in the next year.
AFTER
Since both the DMP and the DSP (and the hybrids) rely on combining 1st Party data and your data with 3rd Party data collected from around the web to create audiences for you to target and effectively connect with – their goose is pretty much cooked. There will be extremely limited amount of new data entering into the DMP from 3rd party cookies and the existing data will become stale. The DSP’s will lose the ability to find these people as they view content on the web, as well as track and report on the fact that they have reached them and served an impression to them and any action that was or was not taken as a result of them seeing the ad.
This will make 1st Party Data even more important, so collect it whenever and wherever you can. The race to register is on so start your engines, and start registering now!
Pixel your emails for retargeting or offer a free gift card for a test drive if users enter their email. 1st Party Data will become the new CryptoCurrency.
Stay tuned for our next post…
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