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By Keith Petri, CSO of Screen6
Much is being said today about cookie consortium(s), the move to server side header bidding and how this impacts match rates. This piece by Keith Petri, CSO of Screen6, addresses all three aspects of the debate.
The age of header bidding has been heralded as a boon to the publishing industry in many ways. But at the same time, it’s brought with it a host of new challenges that affect all parties within the supply chain to varying degrees. As the industry seeks to resolve one challenge, it always seems to stumble upon a new one.
Case in point: due to the growing latency challenges with client-side header bidding, the process of cookie syncing between SSPs and DSPs is increasingly moving to server-side solutions. As a result, cookie sync match rates are getting worse. In other words, in the interest of decreasing page-load lags, advertisers’ ability to communicate with their audiences across platforms is worsening.
Again, our industry has found an imperfect, incomplete solution to a challenge. Yes, server-side header bidding can improve speed, which allows publishers to increase bid density and yield. But the cost of that speed is cookie loss.
As an industry, we need a new solution to this new problem—one that solves not just for reduced match rates but also the challenges inherent in cookie syncing technology. To get there, we must first have an understanding of the root of the challenge we face and why previous attempted remedies have fallen short.
The Problems Within the Solutions
The shift from client-side to server-side environments is a necessary evolution of our industry as we seek to reduce page load times and improve user experience. But this shift comes with its own growing pains. Server-side bidding requires an additional cookie sync between vendors, since only one vendor collects bids and has access the user’s browser. With every additional sync, match rates are reduced. The inability to communicate on a growing percentage of IDs due to poor match rates is negatively affecting revenue across the industry – some companies stating a 25-30% drop in revenue when switching to server-side bidding.
Of course, this is only one of a host of challenges related to our industry’s antiquated cookie syncing process and technology. In recognition of the problems that cookie syncing poses for publishers and advertisers, multiple industry initiatives have emerged in recent years in an attempt to build a common identifier system that would help reduce data loss and the site latency challenges that result from cookie syncing across multiple ad tech vendors.
Unfortunately, all of these initiatives share a common flaw. They’re trying to stop the need to sync cookies by creating a shared pool of identifiers. But such efforts don’t address the real underlying challenge that our industry is facing. It attempts to take an incomplete shortcut, and it’s a shortcut that the politics of our industry won’t even allow to be taken. Look no further than AppNexus’s recent withdrawal from the Advertising ID Consortium, a serious blow to an already shaky initiative.
Regardless, even if one of the many cookie consortia in the market found 100 percent success in its efforts, it wouldn’t solve the real challenge that our industry faces when it comes to consumer identity. After all, identifier resolution is not the same as identity resolution. Being able to resolve an identifier really only solves a challenge within a single browser. Even on a single device, a person is assigned multiple identifiers according to each individual browser they use: one for Chrome, one for Safari, one for Twitter (in-app mobile-web view), etc. None of the current industry efforts would help to optimize match rates across browsers, much less between devices. In short, true consumer identity remains elusive, even in the best-case scenario with a cookie consortium.
Time to Chart a New Course
It’s time for our industry to stop putting Band-Aids on each new challenge it encounters as it clings to decades-old cookie technology that has already outlived its usefulness. A true long-term solution to cookie syncing limitations must take a different path than those we’ve already tried.
At present, our industry is obsessed with identifier resolution when what it should be focusing on is identity resolution. After all, the end goal is to better connect seamlessly with consumers wherever and whenever they like to consume media, right? Well, that consumption isn’t just happening in a single browser. It’s not happening on a single device. So why are we so focused on solving a problem that would only enable these very limited views of a given consumer?
The future of our industry is one built around identity, not identifiers. And resolving consumer identity requires a holistic cross-browser, cross-device, server-to-server approach. It’s time to stop piecing together the crumbs of our cookies and to instead look for a complete solution that solves the root of advertisers’ and publishers’ real challenge.
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