What is the LiveRamps business model

How adtech and media experts assess Google's tracking rejection

Google has shaken up the online industry in the past week: Comments were frantically given and information events were scheduled. At the VDZ Tech Summit, Oliver von Wersch, who represents the IAB Tech Lab in Europe, spoke of possibly the "biggest impact in online advertising since online advertising existed". This could not only turn the digital advertising of the future inside out, but also call into question the business models of many adtech service providers.

What exactly happened? Google manager David Temkin had announced in a blog post that the group would not only block third-party cookies in the Chrome browser in the future, but would also not develop or use any alternative tracking solutions. With the latter, Temkin was not referring to the browser, but to Google's advertising system, which includes the Ad Exchange, the DSP DV360 and the ad servers. In the future, no other identifiers should be used here after the cookies. According to Temkin, one does not believe "that these solutions meet the increasing expectations of users in terms of data protection." However, Google will continue to support first-party relationships on the platforms.

The announcement caused extremely high waves in the adtech camp. Many service providers have developed alternative ID solutions against the background of the imminent departure from third-party cookies. The Trade Desk, Liveramp, Xandr and Criteo are working together on the distribution of Unified ID 2.0, an open source ID solution that is no longer based on cookies, but on encrypted e-mail addresses. Many of these solutions are likely to be left out of the Google advertising system soon.

In their statements, the companies emphasize the first-party orientation of their products in an effort to give the all-clear: "Building first-party relationships is more important than ever, and that is the core of what we do with our ATS and Safe Haven solutions enable ", says Liveramp. Florian Lichtwald, Managing Director at Zeotap, says with reference to the in-house ID + solution: "Google's announcement is a validation of the strategy adopted by Zeotap to focus on the first-party data of our advertising customers." Xandr has just presented extensive identity plans, but is calm: "The declaration from Google only reinforced our belief that we are taking the right approach," explains Marius Rausch, General Manager Central Europe. And what about the log-in alliance that the European NetID Foundation wants to establish? "We see ourselves confirmed in our strategy because we are focusing on the direct customer and user relationship, i.e. first party," says Chief Technology Officer Achim Schlosser. The NetID products are initially not affected by Google's announcement, "because we are only enablers for the legally compliant acquisition of first-party data". Schlosser emphasizes, however: "It remains to be seen which types of first-party data-based advertising Google will support in its own system."

Google itself wants to go two ways in the future: In order to be able to market target group-specific advertising outside of its own system, the technology of Federated Learning of Cohorts (FLoC) was developed. It is based on the fact that the surfing behavior of the user is not recorded by cookies, but by the browser. Based on this data, users are classified into interest-based and anonymous cohorts that can be targeted.

At the same time, of course, the fact that the users within the Google cosmos, i.e. on Google Search and Youtube, are tracked very well - cookies are not required for this. "Google raises its moral finger against tracking in general," concludes Schlosser, "but will also live very well in the future from personalized advertising based on tracking on its own services."

Jeff Green, CEO of The Trade Desk, compares Google's move with an exchange deal: In the future, the group will probably display less advertising outside of its own cosmos because its adtech system enables less targeting. But that would make your own inventory, where you continue to track, all the more attractive. Google is pulling the walls around its possessions even higher. Werner aus den Erlen, Chief Operating Officer Media and Chief Product Officer at Dentsu Germany sees it similarly. "Google is pushing for the elimination of third-party cookies in order to further expand its market dominance. The fact that Google will generally forego following users for the personalization of advertising across the Internet is to be understood as a data protection fig leaf and serves to strengthen it their walled garden. "

And how does it continue? A great many details have not yet been clarified. It is to be expected that Google will concretize its plans in the next few weeks. Above all: The new announcement relates to the advertising system, not to the Chrome Broser. For the latter, however, with the third-party cookie rejection, Google has already set the course for a rigid anti-tracking course. "It will be very exciting when it comes to the question of whether the browser will technically allow or hinder the cross-site identification of users via solutions such as Unified ID 2.0 beyond Google's ad ecosystem", says Tobias Wegmann, Chief Technical Officer at Prex, the programmatic joint venture between Mediaplus and Plan.Net. "The decision about it then rests formally with the Chrome team at Google." kj