Verizon Media’s Paolo Lacuna argues that the time has come for the industry to seriously consider and pursue universal digital IDs to unlock better marketing as the effectiveness of cookies continues to crumble.
As recent developments from major online platforms have revealed, the war against cookies continues to rage even during the COVID-19 pandemic. With no plans to delay the blocking of third-party cookies, we continue to see the proliferation of additional tracking protection features and new restrictions proposed. Despite the advantage that Asian markets continue to enjoy because of its mobile-heavy nature, it is clear the cookie – especially third-party ones used for cross-site tracking, retargeting and ad-serving – is fighting a losing battle.
The big questions that remain, however, are why should we care and what could replace them?
The industry is already moving away from supporting cookie redirects and multiple pixels. This means that first-party cookies – those that are created by the site that a user is visiting – along with device IDs and authenticated user data, are being relied on even more for targeting, attribution and reporting.
However, the constant chipping away at the effectiveness of the cookie has once again brought the conversation around digital identities sharply into focus. For instance, the network infrastructure in APAC results in cookie syncs becoming challenging because of feature phones and 3G that are still common in markets such as Indonesia and India, adding extra weight to a page load through cookie syncs. The industry would be wise to welcome change. A universal digital ID will help effectively align the APAC user experience more closely with global norms.
From a marketing perspective, it is easy to make the case in favour, because it will increase the amount of accurate data at our disposal. We all know that data is at the heart of every effective campaign, from identifying the target audience, to delivering at the right time and in the right place.
But there is also a wealth of evidence to suggest that the consumer benefits of everyone having a unique digital identity would be highly significant.
The case of the crumbling cookie
To date, cookies have enabled consumers to benefit from an almost seamless online shopping process across individual sites, from logging in, selecting a purchase, making a payment and arranging delivery. It’s also why they can enjoy a tailored experience and content relevant to their interests on sites they frequently visit, which is also uniquely personalised to them as individuals.
In a study done by Verizon Media in APAC, 88% of respondents see the benefit in personalised ads, with “utility”, “relevance”, and “interesting” being top benefits In Southeast Asia’s mobile-first economy, e-commerce is expected to grow to US$200bn by 2025, ad personalisation will help brands create experiences that are relevant and provide utility.
But there is one major drawback at present; namely that all of these individual digital identities operate in silos. For example, the habits or search queues for a user on YouTube may be significantly different from their interaction on Instagram, Amazon, or even when engaging with editorial content or gaming. In short, a digital ID on one does not automatically extend to another. In most cases, the data sets never meet. And that’s why implementing a universal digital ID could be beneficial.
The dawn of digital IDs
A digital ID would lead to a holistic understanding of every individual’s needs, leading to an era of greater personalisation for customers across multiple channels as brands use this insight to create compelling offers, enhance loyalty, achieve a competitive advantage and minimise overexposure. It is a win-win situation that gives the brands the tools and insights to give customers what they want, when they want it, and how they like it.
This is especially valuable in today’s world where stay-home measures have driven consumers online and accelerated the already burgeoning e-commerce space that sees the rising popularity of shoppable content, live-stream auction, and shoppertainment in SEA. It is no longer uncommon if the path-to-purchase exists entirely online, skipping the offline channels that previously offered additional points of contact and customer insights - putting many brands that relied heavily on offline channels, especially in APAC’s emerging markets, in an unfamiliar situation.
Of course, we can’t ignore the potential pitfalls of brand safety issues, the risks of privacy infringements and the concern over possible misuses of personal data, but if used correctly, ethically and responsibly, safeguarded by rigorous regulation, both parties stand to benefit.
Another bonus of digital IDs is that they will reduce the surging might of the walled gardens that monopolies and dominant players have over the data garnered from their users. Currently, marketers can, of course, use this data to create personalised experiences for the audience at scale, while also meeting consumer demands for real-time, context-driven responses and content from brands, with SEA’s 5G networks giving it a boost. But these campaigns can only be delivered within that platform and can’t be shared or utilised across any others. Or indeed, anywhere else at all.
Marketers can put plenty of data in but absolutely can’t get it out. Digital IDs, on the other hand, would help brands have a consistent, unified and coherent view of their customers. Without the benefit of this right now, marketers are very much having to make-do and mend.
Sure, there are touted solutions such as Safari’s Storage Access API, which lets third-party embedded content request access to first-party cookies if, and only when, the user interacts with them, usually by clicking a button to accept. However, there are multiple issues with this approach, not least that brand and website owners need to reveal their multiple technology partners to get the consent in the first place, plus the inherent impossibility of getting permission to retarget users.
There is also a raft of digital ID initiatives already out there, such as DigiTrust ID from IAB Tech Lab, Advertising ID Consortium by various SSPs and The Trade Desk’s Unified Open ID. All are well-intentioned and have their merits, but not one of these has been adopted as the favoured or dominant, universally-accepted solution.
Despite the benefits of digital IDs being clear – both for brands and consumers – as an industry, we are not yet delivering for either. It’s by no means an easy task but set against the demise of the cookie and the growing dominance and likely proliferation of walled gardens, it is one that needs to be tackled head-on.