In recent years, brands have come to rely heavily on consumer data and behavioral tracking to power their digital campaigns. We need look no further than consumer DTC disruptors like Casper, Warby Parker and Dollar Shave Club – companies with no physical retail presence that have quickly become popular and profitable. 

These brands have depended on performance marketing to reach customers, pouring resources into digital that might otherwise have been spent on physical overhead. Legacy brands have taken notice and poured their own resources into performance marketing for audience acquisition and conversion.

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Cookie-based performance and consumer data made programmatic advertising profitable for publishers, advertisers and vendors. Recent developments from Google put the future of this system in doubt, as they seek to remove third-party cookies sometime in 2022.  

Add to this the growing public awareness of data collection, tracking and behavioral targeting, and the remainder of 2021 represents a paradigm shift in how digital advertising, and publishing, will function.

As with anything else in the modern economy, the successful resolution of these developments will depend on leveraging the right data. In order to do that, data collection practices will need to evolve to provide a fair value exchange for consumers.

The future of performance marketing, and thus many of the players in the ecosystem, will still need to rely on data to drive conversions, messaging and sales. Historically, that has relied on a value exchange whereby people received free content from publishers in exchange for allowing tracking (the “cookies” popup we’re all familiar with) and targeted ads.

Now, as much of the consumer data that served as the lifeblood of the system is going away, advertisers are going to have to find new sources and methods for working with what they have. With less data available, marketers will need to decide how much consumer data is enough for our purposes, as well as which sets are the most valuable. And more importantly, how will it be collected?

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The answers to these questions aren’t obvious yet, but we’re probably already familiar with some informative examples of how this might play out:

• Spotify – If you don’t pay for Spotify Premium, you might have noticed offers to watch video advertisements in exchange for uninterrupted music play time. Since your Spotify account is personally authenticated, this represents a fair-market value exchange by which the consumer willingly exchanges some time/attention in exchange for content.
• Youtube – Being a Google property, Youtube enjoys a heavily logged-in/authenticated audience. Thus, by incorporating unskippable ad formats, Youtube is able to force a direct value exchange with an individual in order to serve content.
• Surveys – If you’ve ever seen an offer to complete a survey in exchange for an offer, that model fits the personal data value exchange.
• vieworks.io – Offers “perks” like discounts and loyalty programs in exchange for authenticated views of video ads.

The future of digital marketing is likely to rely heavily on value exchange models. All of this will require an adjustment in behavior for all stakeholders; advertisers and consumers viewers.

Fortunately, we work in one of the most innovative industries on the planet. As more data is collected and consensus reached, the path forward will almost certainly present more opportunities than setbacks. When consumers, publishers and advertisers all feel comfortable with the value exchange of information, everybody (eventually) wins.

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