Digital Privacy Is Now An Unstoppable “Three Body Problem”

This guest post is written by Myles Younger, a former ad tech entrepreneur who now serves as a Senior Director at Media.Monks

As someone who once built an ad tech platform that depended on third-party cookies and other user-level identifiers, I know a thing or two about what’s likely to happen as “the death of the cookie”* unfolds. I’m also skilled at explaining technical concepts to not-so-technical people. And so I regularly get asked to explain “the death of the cookie” — and other advertising identifiers, such as the IDFA — to marketing teams, CMOs, and other decision-makers. This is happening with increasing frequency as 2021 draws to a close, and I expect the need for education will only get more pronounced going into 2022.

In this article, I want to articulate the core lessons about the changing privacy landscape that I present to audiences that only need to see the forest, not count every tree. Marketing leaders need a forward-looking basis for making plans and setting priorities, and they need to understand both the risks and opportunities that lie ahead. And as you travel down the org chart, marketers need the leadership above them to understand privacy; it’s hard to get buy-in on a proposed privacy strategy if your boss doesn’t understand what’s going on.

In short, I get paid to explain “The Death Of The Cookie” to marketing leaders. Here are the top 3 things I tell them.

Digital Privacy Is Now An Unpredictable, Unstoppable “Three Body Problem”

Physics’ “Three Body Problem” tells us that when you have three planetary bodies orbiting one another in space, it’s impossible to accurately predict their paths due to the complex and ever-changing gravitational relationship between them. This is exactly what’s happening with the global battle over privacy, which is being waged by three massive “planetary bodies”:

  • Tech competitors inclusive of Walled Gardens (or “Content Fortresses”), consumer device and software makers, adtech platforms, and telcos;
  • Government regulators who see consumer privacy, national security, and antitrust as being different facets of essentially the same critical question: what role should digital technology play in the societies of tomorrow?;
  • Public opinion in reaction to intrusive tracking, repeated data privacy scandals, and a groundswell of investigative journalism.

I urge marketers to consider three basic truths: the current trends around privacy that started in 2018 are nowhere near resolved; brands and agencies stand little chance of meaningfully influencing events and outcomes; and the events of the next few years cannot be predicted with any certainty.

But the phrase “never waste a good crisis” definitely applies. Consumer attention via digital media isn’t going anywhere. What’s changing is how that attention is accessed for advertising. So the strategy that stands the best chance of success is one of flexible (if uncomfortable) adaptation.

It’s Unlikely There Will Be A New “Easy Button” For Programmatic Media Buying and Measurement

Privacy is causing a quasi reversion to the pre-programmatic world of fragmented digital media and audience management. It seems like there’s a new Walled Garden every day. Seemingly, brands will have to manage and measure their media and audiences across a portfolio of these Walled Gardens, except without persistent user-level identifiers made possible by third-party cookies and mobile advertising IDs.

How does this affect marketers and their agencies? Well, targeting (and retargeting) addressable audiences won’t be as easy as logging into an all-seeing DSP, and ad measurement’s most hyped “Easy Button” —Multi-Touch Attribution (MTA)— has been rendered all but obsolete (unless we’re talking about MTA across touchpoints inside a Walled Garden).

It looks like marketers will need to use a number of imperfect approaches in combination. On the targeting side, possibilities include Google Chrome’s FLoC / FLEDGE proposals, Unified ID 2.0, direct publisher deals, or audience activation via cloud-based “clean rooms.”

On the measurement side, a “balanced breakfast” is likely to include measurement signals from Walled Garden clean room reporting platforms, native measurement protocols like Apple’s SKAdNetwork, and more probabilistic approaches like media mix modeling.

CMOs and their teams will need to rewrite digital playbooks and reassess media efficiency, audience targeting, customer journey orchestration, and measurement, often replacing or augmenting existing “Easy Buttons” with a more diverse blend of tactics.

Prepare For A Massive Privacy Skills Shift That Will Impact Your In-House Teams And External Agencies

Privacy is changing the fundamental building blocks of digital marketing and advertising technology. The details get very technical very fast, but the TL;DR is that there is a massive skills shift already underway.

One example I like to point to is the rapid shift to “server-side” technology, happening after 20+ years of adtech largely centering around browser- or device-side technologies like HTTP, JavaScript, HMTL, mobile SDKs, and browser/device APIs. I can speak from experience: managing servers is very different than copy/pasting tags and scripts! Cloud computing isn’t rocket science (except when it is), but it is going to take significant time and effort for marketers and agencies to master it. And time happens to be of the essence. It would be generous to give third-party cookies another 24 months to live. Regardless, the amount of user data available from web browsers, apps, and devices is steadily drying up on virtually all fronts. In the future, digital advertising data will move server-to-server or it won’t move at all.

The moral of the story: brands should begin investing heavily in reskilling their in-house teams while confirming that their trusted agency partners are reskilling too.

“The death of the cookie” ≠ death of digital advertising

Privacy is simultaneously important, urgent, and technical, but my aim isn’t to tell marketers the sky is falling. To the contrary, privacy is an opportunity, and one I’ve written about extensively. In order to move forward and seize this opportunity, however, CMOs and marketing leaders first need to align on basic truths and premises, the most pressing of which I’ve summarized here.

Myles Younger is a Senior Director at Data.Monks, where he leads the go-to-market team, commercializing solutions to help brands maximize the value of their advertising, marketing, and customer data sets. Previous to Media.Monks, Myles was an ad tech entrepreneur and built the Canned Banners dynamic creative platform. Writing frequently on the topic of digital privacy, he’s a regular contributor to industry publications such as Adweek, AdExchanger, and AdMonsters and lives in Portland, OR.

Photo by Dominic Brügger on Unsplash