ConnectAd Chronicles

From cookies to identity solutions: The evolution of user identification in programmatic

Whether digital marketing or adtech in general or programmatic advertising in particular: Data has basically always been the linchpin of our industry. It drives strategic decision-making, enables in-depth customer insights and ultimately contributes significantly to the success of online advertising campaigns. For the past 20 years, advertisers, content creators and publishers have traditionally relied solely on third party cookies as THE way for industry players to collect and track user data and customer identity for marketing purposes.

But this is no longer the case. Because this standard is slowly but surely being phased out. Safari and Firefox have already said goodbye to cookies. Only Google Chrome is taking its time to switch off until the end of 2024. Only one percent of users are currently affected, but it's only January. And we all knowhow it goes: Time flies – and before you know it, another year has passed. And then what? Then we need a good alternative. An alternative that we'd better think about today than tomorrow.

The rise of identity solutions (IDs)

In addition to contextual targeting, ID solutions in programmatic advertising are among the most promising and, above all, well-tested cookie alternatives that have already proven their worth when it comes to serving more relevant ads to users. 

What are IDs?

Instead of relying on cookie-based tracking, identity solutions use first-party website cookies, which can come from offline databases such as customer management software (CMS), among others. In addition, permanent user identifiers such as email address, phone number or login ID are used to track users. The ID created is a universal identifier and can be used across websites, other channels and platforms. It serves as a unique identifier within the digital marketing ecosystem and makes it easier for authorized partners in the supply chain to access user-related information.

Essentially, a universal ID is a unique identifier that is assigned to each user and simplifies the transmission of user information to authorized partners in the system. This is because, unlike the previous reliance on third-party software to synchronize cookie data between platforms, universal IDs eliminate the need for such tools. This technology also solves problems such as slow and buggy websites that negatively impact the user experience and allows advertisers to target ads more precisely to specific users.

Why do we need IDs?

IDs are essential for a number of reasons. we would like to explain the three most relevant ones in more detail below.

- Firstly, IDs address concerns related to user anonymity and ensure compliance with GDPR regulations by allowing businesses to manage and utilize user data while safeguarding individual privacy. This prioritization of privacy aligns with the increasing emphasis on data protection in the contemporary digital landscape.

- Secondly, IDs offer businesses independence from major technology platforms also known as “the big five” as there exists a large number of ID providers empowering you to establish your own identity frameworks. This reduces reliance on big tech entities, providing greater control over user information and mitigating risks associated with changes in third-party policies. This autonomy enhances data security and grants businesses more flexibility in managing their data.

- Lastly, IDs enable valid user matching, resulting in higher sales potential. By leveraging first-party data from diverse sources, these solutions allow for the creation of accurate and comprehensive user profiles. This, in turn, facilitates more precise audience targeting, leading to increased effectiveness in delivering relevant content or advertisements. The improved targeting not only benefits advertisers but also enhances the overall user experience by providing more personalized and meaningful interactions.  

Summing up

In essence, IDs are the best successor to cookies as they emerge as a multifaceted solution, addressing privacy concerns, reducing dependence on major platforms, and elevating the effectiveness of targeted marketing efforts. However, there is no more time to waste. Publishers, agencies and advertisers who have not yet addressed this issue should get up to speed as quickly as possible. Because with the end of third party cookies, things are about to get nasty. But don’t worry! You’re not alone in this. We at ConnectAd are technology agnostic and work hand in hand with the most common ID providers. This means we are well equipped for the future. If you have any questions, please contact us. We're here to help.