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The Winds of Change Are Chilling for Some in Ad Tech

The Winds of Change Are Chilling for Some in Ad Tech

By   February 21st, 2018

Digital marketing has always been a fast-moving industry. Recent changes by the browser players are creating tectonic shifts that every advertiser and vendor should watch closely. For example, Apple announced Intelligent Tracking Prevention in the summer of 2017 and the ripples hit some ad-tech vendors hard, impacting even large vendors like Criteo.

Three key changes in the browser landscape will challenge the status quo:

  1. Apple Intelligent Tracking Prevention
  2. Google Parallel Tracking
  3. Chrome native ad blocking

Ironically, Apple’s tracking changes will actually help Google and Facebook, who continue to capture virtually all of the growth in digital ad spend. The harsh reality is that this growth will come at the expense of real-time bidding/programmatic display. The changes will directly challenge the core business model of many programmatic exchanges. (On a related note, I expect Amazon to grow and benefit from these trends in 2018 and beyond.)

If you’re not working with the larger publishers, trying to reach your target audience based purely on demographic and behavioral data will be more challenging than ever before. Advertisers should also be aware that accurate targeting and measurement across search, social, and programmatic display will be severely limited for redirect-based solutions (remember that redirects underpin the ad tech stack of many smaller publishers).

Read on for more details on these changes and Marin’s predictions about how they’ll impact the digital marketing landscape for the rest of 2018 and beyond.

Safari ITP

The Change:

At the WWDC last June, Apple announced that upcoming versions of all their operating systems would limit how long cookies would be stored. Dubbed “Intelligent Tracking Protection,” this change restricted all third-party access to cookies for purposes such as advertising and tracking to a one-day window. The cookie can still be referenced for login purposes for 30 days, but it’s no longer available for cross-site tracking. Safari is critical because although its desktop share is low, its presence on iPhone and iPad devices means that Safari’s U.S. mobile market share is over 50 percent—and skews younger and affluent as well.

The Impact:

Since traditional programmatic display is built on third-party cookies, ITP will make it harder for smaller publishers and many third-party ad tech providers to offer audience targeting capabilities based on prior web behavior or browsing patterns.

Does this mean the ads that follow you everywhere around the internet won’t be so persistent? Not really. This change isn’t a big deal for Facebook and Google in the long term, even on Safari; many users visit these sites directly multiple times within a 30-day window, where those publishers can set their own darn cookies! Advertisers will still be able to effectively retarget with Google and Facebook, both on owned and operated sites, and on third-party sites via the Google Display Network/Facebook Audience Network.

Marin has offered a first-party tracking solution for years which is compatible with Safari ITP already. Many of our customers use it, and it’s a fully tested and proven solution. We also work seamlessly with tracking from DoubleClick, Adobe, Sizmek, AppsFlyer, Kochava, Google, and Facebook. We also offer Marin TruePath, a cross-channel measurement solution that incorporates cross-device data while de-duping across publishers. To learn more about TruePath, contact us today.

Google Parallel Tracking (GPT)

The Change:

Today, clicking an ad results in at least two network round trips: the first to the publisher (let’s say Google or Facebook) to record the click, and the next to the landing page for the result. Redirect tracking such as doubleclick.net or xg4ken.com will incur additional round trips, slowing page loads even further. Google created a process called Google Parallel Tracking (GPT) to get visitors to landing pages more quickly once they click an ad. This may seem like a small improvement, but advertisers should be aware that a one-second delay in mobile page load can decrease conversions by up to 20 percent.

How does GPT work? It uses sendBeacon, a browser method for asynchronous payloads, to send click information to data collectors in parallel with loading the landing page. In practical terms, GPT sends users directly to your landing page after they click a search ad, rather than through a redirect. The browser processes URL tracking requests in the background, speeding up page load times and reducing mobile post-click abandonment. Check out Google’s full GPT announcement on Inside Adwords.

The Impact:

Because they are “sort-of” 1st party (the browser visits that domain) and “sort-of” 3rd party (it only visits for a few milliseconds and the user did not intentionally go to that domain), redirects have been a loophole for setting cookies as long as browsers have blocked 3rd party cookies. Like ITP, sendBeacon treats its payload once and for all based on the browser page, not the payload page. This means that cross-domain tracking and targeting is more limited for browsers that restrict third-party cookie-setting. This is a default setting with Safari but it’s also applicable to other browsers.

In combination with Apple’s ITP changes, relying on redirects for tracking has become increasingly difficult and detrimental to ad performance. Put simply, ad tech providers who rely on redirects for their tracking (such as DoubleClick Campaign Manager, for example), are using estimation rather than concrete data.

What You Can Do:

Parallel Tracking will be applied selectively at first and become standard (non-optional) over the first half of 2018. Safari owns about half of all mobile traffic in the U.S. and an even higher percentage among more affluent customers. DoubleClick is hampered by offering advertisers an “estimated” approach which says that it’ll project which Safari visitors actually converted. As an advertiser running sophisticated digital campaigns to reach customers, do you really want to guess at your conversions from iPhones, iPads, and Macs?

Here are steps you can take to mitigate the impact of GPT:

  • Find a solution like Marin that offers a first-party approach.
  • Ensure you can measure upstream Facebook views.
  • Combine with publisher tracking to better measure multi-device journeys.

Chrome Native Ad Blocking

The Change:

Beginning on February 15th of this year, Google’s Chrome browser began blocking all ads on any website that don’t meet the standards defined by The Coalition for Better Ads. With a stated goal of making online ads better for everyone, the coalition has identified four desktop and eight mobile experiences that fall below their standards.

The Impact:

The goal is to encourage advertisers to present non-intrusive ads, thus creating a better experience for the end user and encouraging fewer ad blocker installations. These new ad standards are likely to promote a “flight to quality” where publishers will look to Google and Facebook to ensure that users have an appropriate ad experience.

What You Can Do:

As an advertiser, you can allocate more budget towards social media ad formats, like in-stream video or Instagram Stories. These ad types are designed to reach users in a meaningful way and are less likely to run afoul of the new ad standards. In addition, you can enjoy the clear benefit of driving higher user engagement for your campaigns.

The Key to a Unified Experience

All three of these changes are being made ostensibly with the goal to create a better experience for users. If successful, visitors will gain increased privacy, faster load times, and better ad experiences—all positive developments from the user’s perspective. However, these improvements will come at the expense of programmatic players in a fragmented ad tech industry.

As the industry struggles to adapt to these changes, Google and Facebook are well positioned to continue capturing additional share of digital ad spend. At the same time, these publishers offer powerful targeting capabilities that can drive performance for advertisers. That’s why it’s imperative that advertisers have a strategy and toolset that enables you to work across these channels. Your customers are moving between Google and Facebook, so make sure you have a team and marketing stack that gives you full visibility into the cross-channel customer journey.

Our team at Marin understands these changes and can talk with you about your particular cross-domain, sub-domain, or retargeting requirements. Contact us today if you’d like to talk about these tracking issues further.