Mitch Waters
Mar 22, 2021

Google has galvanised Unified ID 2.0, not sown doubt

The adtech firm behind the open source Unified ID 2.0 states its case for why the universal identifier remains a powerful cookie alternative, even without Google's involvement.

Google has galvanised Unified ID 2.0, not sown doubt

Google’s recent announcement that it will not develop or support any targeting technology outside its owned internet properties, such as Google search and YouTube, reverberated throughout the industry.

Regardless of what Google does or doesn’t do as it phases out third-party cookies on Chrome next year, there remain three core principles about the internet that are not changing. And it’s these principles that we have to design around as we think about the future of identity on the internet.

First, the desktop browsing internet, where cookies prevail, represents a small and shrinking slice of the digital advertising pie. It represents less than 20% of The Trade Desk’s global business and is rapidly being outpaced by newer forms of digital advertising, such as connected TV, OTT video streaming, audio and mobile.

Indeed, CTV advertising, which includes OTT video streaming, was the only growth segment of the global digital advertising market in 2020. That’s because not only did consumers shift more rapidly than anyone predicted to streaming TV services as they were sheltering at home during a global pandemic, but also advertisers saw the value of applying data to their massive TV ad campaigns for the first time. These fast-growing formats enable the kind of data-driven precision that is highly appealing to advertisers looking to prove the ROI of every advertising dollar and compare those TV ad impressions across all advertising channels.


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What’s also interesting about these rapidly growing digital advertising channels is that they largely rely on consumer email logins to create identifiers. Cookies are non-existent. And that’s good for the consumer. They get to be in control of the process in a way that’s not possible with cookies.

And let’s acknowledge that by stepping away from identity technologies on the open internet, Google is essentially stepping away from these fast-growing digital advertising channels, including CTV and OTT. Google will continue to drive targeted advertising based on its treasure trove of consumer login data within its owned and operated properties but will step away from the open internet. In particular, OTT video streaming in Asia, by comparison, is a highly competitive and fragmented market where the cost of entry is high, where there is a content arms race, and where there is no opportunity to build anything approaching a monopoly position.

Second, the core value exchange of the internet is not changing. Users get to see free content in exchange for relevant advertising. Consider the US, where the average ad revenue per internet user is around $35 per month. As you read the news online or binge-watch your favorite series on your smart TV, you are likely paying for it by watching advertising. The more relevant that advertising is to you, the more valuable it is to the advertiser and publisher, and the more it can be used to fund great content.

This is no different from the way content has been monetised for decades. Almost all consumer content has had an advertising attachment, and for all but a select few subscription services, advertising is the path to monetisation. And consumers understand this. Our latest research shows that nearly 9 in 10 Southeast Asian consumers will watch advertisements in exchange for free content. In the relatively wealthier Japan market, almost 70% of video streaming service users responded that they would watch ads if it would lower their monthly subscription fees or make their favorite content free. However, what they do want is more control over the process.

Which brings me to my third principle. Any successful identifier technology, moving forward, has to be designed around the consumer. The consumer needs a clear explanation of the role advertising plays in funding content, and the ability to control how their data is used. This consumer-conscious design is the only way that the industry will meet the evolving consumer and regulatory concerns around privacy. It’s also why cookies have failed.

Unified ID 2.0 has been designed with the consumer in the driver’s seat. With more than 50 million US consumers already on board even before beta launch, and with support from almost all corners of the adtech industry, Unified ID 2.0 effectively threads the needle of consumer privacy and relevant advertising.

This is critical from a regulatory perspective too. Whether it’s GDPR, CCPA, or any other recent privacy legislation, the focus has rightly been on philosophical principles versus prescriptive guidelines. And with little case law, it’s up to the industry to develop the use cases that meet these emerging regulatory requirements. The most effective way to start that work is designing around those same philosophical principles. And most important among them—consumer control. Without that focus, there will always be questions and doubts around motivations and ownership.

As an industry, we have an opportunity to recreate the fabric of the internet as cookies are phased out. We should embrace it. And we should do it in a way that preserves the value of relevant advertising for brands, enables publishers to fund great content and produce more of it, and enables the consumer to make educated decisions. If we get that right—and I believe we are on the right path—everyone wins.


Mitch Waters is SVP of Southeast Asia, India, Australia and New Zealand at The Trade Desk. The Trade Desk created Unified ID 2.0 as an open source framework. It handed control of the solution over to industry nonprofit Prebid in February

Source:
Campaign Asia

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