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The digital advertising ecosystem grew up on the shoulders of third-party cookies. This provided an easy way to track and monetize an audience in search of the world’s information at its fingertips.

But the cold, hard truth is that the cookie has been broken since day one.

It was simply an unsustainable model, neither built for the tasks we ask of it now, nor designed to ease the trusted exchange of value today’s world is asking for. The standard practices of digital marketing are crumbling due to the rising tides of privacy regulations, competing solutions and interests, and consumer expectations for greater transparency and control.

While there are a lot of efforts underway to find a replacement for third-party cookies, they all lack the scale that cookies offer.

The dominant platforms are developing sophisticated, technical solutions that may address each silo’s needs, but they don’t serve the industry as a whole. Also, limitations in scale aside, none of these solutions address the core issue that is driving the need for change: consumers’ cries for control over their own data.

This valuable resource of added time should be used to continue testing and refining industry-led solutions for advertising relevance and measurement. The solutions with staying power will be the ones that create a fair and trusted value exchange between consumers, publishers and brand advertisers.

Evolving beyond third-party cookies: transparency and quality

The adtech ecosystem created third-party cookies to improve the digital experience for users, while allowing publishers to understand audiences and monetize content. However, the widespread use of cookies led to unintended consequences, including consumers who were left wondering exactly who and how many people are watching them.

For publishers and advertisers, cookies didn’t quite live up to the industry’s needs, proving to be highly inefficient and inaccurate. By nature, they are transient and ephemeral, and the model is such that scale matters more than quality. The advertising world may have treated cookies as a single source of truth. However, the lack of fidelity in the third-party cookie system means that measurement and audience building, have become increasingly random.

While the industry is understandably nervous about the fate of digital media and advertising, this is a chance to create a better future. As we consider cookie alternatives, we should focus on two things:

• Transparency: According to Accenture research, 73% of consumers will share personal information if brands are transparent about how it is used. But cookies were a technological solution to a problem that is more human in nature. We need models that ensure consumers feel good about the value exchange.
   
• Quality: By building trust between consumers and the publisher ecosystem, we can enable a fair and transparent exchange of value. We also can create measurement and audience segmentation tools in a way that improves the experience for all parties, net-net.

The spectrum of data-sharing and the zero-party middle

Developing cookie alternatives that are fair to both consumers and the publishers producing the content they want takes time, investment and R&D. Most likely, the third-party cookie system will be replaced by multiple solutions, as opposed to a cookie 2.0, to account for consumers’ varying privacy preferences.

If you think of data-sharing preferences as a spectrum: On one end, you have consumers who do not wish to share any data, even if that means paying for content. On the other end, you have users who say, “I have all the data you want, I will gladly share.”

The majority of people lie somewhere in the middle of the data-sharing spectrum.

For those not willing to share their data, under any circumstances, subscriptions may be the future. But the scale of the internet cannot be supported by subscriptions. Many US consumers are already experiencing “subscription fatigue.” According to Deloitte research, 53% of people surveyed are frustrated by needing multiple subscriptions to access the content they want.

Now, consider how many websites people access in a week, and how many subscriptions you would need to support the average user.

Consumer-centric thinking is required as ad and martech strive to innovate new technologies and methodologies. Zero-party data is a concept in which consumers voluntarily share data in a fair and transparent way for approved purposes and in exchange for something they value. In this model, publishers or vendors act as stewards of consumer data, asking for permission before leveraging it, and ensuring customers understand how that data will be used. 

There is a broad spectrum of how to compensate consumers for sharing their data on attitudes and behaviors with brands and publishers. This provides an explicit exchange of value while also underpinning the advertising lifeblood for publishers. Marketers can use this data to facilitate audience planning, segmenting and measurement.

The industry will surely continue its move to zero-party data systems, and the future will probably entail a combination of approaches including micro and macro value exchanges — and ideas we haven’t even thought of yet.

The uncertainty may feel scary, but the deprecation of the third-party cookie is a chance to solve one of the questions that is most crucial to the future of the scaled internet. Cookies were a starting point, really, with flaws we have been overlooked for too long.

Now is our chance to innovate and create a future in which consumers believe advertising solutions are honest and fair. In this future, brands and publishers believe in the quality of data and the adtech industry facilitates a virtuous and sustainable cycle of trust.

Kevin Whitcher is a change agent at the intersection of data, analytics and marketing known for driving tech innovation in the measurement of identity and ad performance. As vice president of Product, Enterprise Applications for DISQO,  Kevin leads the strategic vision for client solutions, using DISQO’s people-first audience insights platform and complete view of consumer journeys across all digital environments. Kevin is scaling DISQO’s product team to a world-class organization that delivers breakthrough solutions for researchers, brands, agencies and media publishers.