The Shifting Advertising Landscape
By Ryan Bricklemyer, VP of Ad Operations and Product at Octopus Interactive
The Role of Intent in a Post-Cookie World
The modern ecosystem for digital advertising is based on performance. In contrast to brand advertising – the awareness-lifting exercise we see in Super Bowl commercials – performance advertising endeavors to reach customers who specifically are in the process of considering a purchase. For example, a TV advertisement for a car plants the seed for the audience to consider that car for their next purchase – whenever that might be. A performance advertisement would be one that zeroes in on that specific consumer based on signals of purchase intent, like searching for automobile reviews in Google.
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In order to measure performance advertising, the industry adopted the wide-scale use of third-party tracking cookies. These enabled interested parties to attribute purchases and conversions to specific publishers and advertisements. The third-party tracking cookie allowed any number of players to track an individual’s movement around the Internet. With this data in-hand, advertisers could both target individuals and optimize their campaigns.
Now the third-party tracking cookie is going away, and advertisers are going to have to find other ways to reach their target audiences. For a time, third-party identity solutions seemed to provide a workaround for reaching individuals, but Google announced more recently that third-party identity support would be going away as well. This all has taken place against the backdrop of a public that is just beginning to understand how their information is gathered and used for marketing purposes.
So what’s left? The digital advertising industry is going to have to accept that identity resolution is going to become less granular. In doing so, it will become harder to identify potential customers on the basis of intent. This leaves advertisers in a difficult position, but it could also lead to improvement across the board for the digital ad ecosystem.
Consider this: Before digital marketing, advertisers trying to reach specific audiences had to rely on things like subscription lists to target households according to their interests as reflected in things like magazine subscriptions. By cross-referencing ZIP codes advertisers could get a general sense of the economic status of a customer household, and with that they could send mailers or buy space in the local newspaper. One step more granular was contextual advertising – which simply involved placing advertisements next to relevant content. A beer ad on the sports page, for example.
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In many ways, what was old is new again. Advertisers left without third-party identification are going to be left with things like contextual advertising in private publisher marketplaces. These sorts of signals and executions are notoriously difficult to scale, however, which means that advertisers are also going to be looking at new, emerging channels to determine intent and drive performance.
Think about the third-party screens you see in a given day. As the world emerges from Covid isolation, you might see a digital billboard outside a sports stadium, a bank of TVs playing at the gym, or a digital activities board on a college campus. All of these channels convey levels of intent, simply by virtue of the fact that they’re appearing in particular settings. A patient watching a screen in a doctor’s waiting room has sent very clear intent signals, simply by being in a doctor’s office.
Along with audio (including podcasts) and other out-of-home (OOH) channels, these approaches are going to become very interesting for marketers as the economy opens up and privacy regulation continues to develop. Consumers are only going to become more exacting when it comes to their privacy expectations, and the big walled gardens are going to help them. What takes the place of individual targeting has yet to be seen, but odds are it will leverage new and dynamic methods for determining intent.
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