How did Adwords change bidding at the end of 2023? (performance analysis)
What is AdWords? Google AdWords, now known as Google Ads, is an online advertising platform by Google. It allows businesses…
The cookie and the internet were invented almost simultaneously. The cookie is one of the most fundamental, but also one of the most derided, browser mechanisms.
Virtually all internet applications use cookies to work better.
The basic point is to make it easier for the user. For example, if I visit a website and select English as my default language, next time I visit the site, it will start up with English by default. Long ago we realized that we could store a lot of other information in a cookie that could be used (and is widely used) for user tracking. It is also the tracking feature within the cookie that has given rise to debate in recent years.
One common misconception is that the cookie is illegal from a GDPR (General Data-Protection Regulation) perspective, but it is not true.
The GDPR focuses on how personal data is handled, whereas a cookie is what’s used to store personal data.
You may have already read about the Unified ID.
This technology aims to solve the third-party problem we have in the market today. It is quite often stated as “the new cookie” that makes it possible to identify users across SSPs and DSPs in a revolutionary way. SSP provider Pubmatic recently launched a case study analyzing the effect of Unified ID, and the results are very promising. See the image below.
What is a Unified ID?
The unified ID is a technology with a standardized, cookie-based identifier for all web experiences (desktop, mobile, and tablet) that is synced among all DSPs, DMPs, and SSPs. It is an ID stored in a first-party cookie, accessible in a third-party context.
The aim is to reduce the need to use third-party cookies in the programmatic landscape. As you know, it has become tremendously harder to use third-party cookies within the last two years. The benefit for publishers and advertisers is clear – higher match rates of audience data and sizes mean higher revenues and bids for the publisher.
IAB research
“IAB research shows that more than half of all U.S. dollars spent on data in 2017, were spent with data-management companies, highlighting the need to create systematic and efficient workflows”
Dennis Buchheim, Senior Vice President and General Manager of the IAB Tech Lab.
Do you like what you’re reading? Subscribe our newsletter for more content like this!
[mc4wp_form id=”407″]
Industry standard
Unified ID is an industry standard with several competing ID providers: Unified ID solution, the Advertising ID consortium, and DigiTrust (IAB Tech lab). The strongest is owned and operated by the IAB Tech Lab, which bought DigiTrust in April 2018. DigiTrust is a non-profit, industry-wide collaboration of companies building technology within the IAB (Interactive Advertising Bureau). That IAB takes the lead and drives standardization means a lot to the entire ecosystem.
What are the main arguments for Unified ID?
- They provide additional infrastructure for the GDPR Transparency and Consent Framework, an initiative led by IAB Europe.
- They reduce page load time for users. Sending and syncing up to 100 independent cookies, which often is the case for a publisher, creates slow websites for the user.
- The goal is long term, having a limited set of common identifiers like Unified ID, instead of all the cookies being used today.
- They maximize ID accuracy from inventory mapping, increase DSP match rates for audience targeting, and generate higher bids and more revenue for publishers and better campaign results for advertisers.
- Interoperability and support from multiple ID solutions improve the match rates across the ecosystem at large.
The market dream
The market dream is a universal ID for all consumers across all devices. Today, we’re seeing websites with hundreds of different cookies loading on every page and being stored with every browser.
Publishers, also from a GDPR perspective, are seeing requests for IDs coming from companies that they have never heard of, and the more cookies being loaded, the slower the site gets.
In the end, the user (your visitor) will be disappointed and might claim your site is slow (even if you have invested millions in a fast and sleek website) due to third-party cookies.
Today
Today “every” AdTech firm drops a third-party cookie into a user’s browser while they are browsing publishers’ websites. Unfortunately, there’s a catch. A domain can’t read a cookie dropped by another domain, and this means that if an AdTech vendor drops a cookie, it can’t be read by any other company that has its own domain. That’s why we see so many cookies out there today.
This is all done through an SSP to request an ad bid from a DSP for a given web page, passing the SSP’s ID in its cookie inside the bid request. With the wide adoption of header bidding, the number of cookies in the requests have been up eightfold.
Over the last two years
It has been much harder for advertisers to reach their target on websites due to the third-party problem, and with a lower ability to target users, the ROI of the campaign decreases. As does the willingness to pay. Therefore, it’s great to see the IAB Tech Lab catch this and go all into Unified ID. This can help advertisers increase their revenues.
Unified ID
Unified ID’s stronger, first-party “consistent cookie” will benefit all who implement the solution on their sites. Thanks to this, they can get closer to having the persistent user identity enjoyed by walled gardens like Facebook’s and Google’s login. However, it requires unified actions from all AdTech providers, and so far the adoption is growing.
Let’s keep our fingers crossed!
If you want to learn more about Unified ID in depth, visit one of the below.
