With iOS 14’s new privacy regulations on the horizon, advertisers and publishers are preparing for what they believe the immediate impacts will be. Whether or not this will cause a domino effect across the industry with Android next—as was the case with third-party cookies on Safari and Chrome—remains unknown. 

Hear Nola Solomon, VP, AdSmart Programmatic, Advanced Advertising Products, and Strategy at NBCU; Prashant Upase, Head of Product for Growth and AdTech at Uber; and Liane Nadeau, Head of Precision Media at Digitas, discuss the future of mobile IDs and the consumer experience with moderator Travis Clinger, LiveRamp’s SVP of Addressability and Ecosystem. 

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Episode Transcript:

Liane Nadeau:
We’ve said this isn’t a shake-up for how we’ve done things. This is a complete restart to how we build an ecosystem that is going to allow us to be addressable and measure performance outcomes, and do it in a way that will last. 

Daniella Harkins:
That’s Liane Nadeau, Head of Precision Media at Digitas, speaking at RampUp on the panel, “Managing a Post-IDFA World.”
And this is, “Saying the Quiet Part Out Loud,” a podcast from LiveRamp that uncovers what’s unsaid about technology, data, and business, and explores how they intersect. I’m Daniella Harkins, SVP of Commercial Strategy and Excellence at LiveRamp.
For those not familiar with IDFA, it’s Apple’s specific acronym for what the industry calls mobile IDs. They are used by publishers to monetize their apps and by advertisers to reach users. Next year, Apple will require apps to receive permission from users to access and use their mobile ID.
At least in the short term, there will be an impact to the mobile experience brands and publishers create and curate—it remains to be seen whether people will welcome the change or not.
At RampUp: Worldwide Virtual Summit, we unpacked the topic with panelists Nola Solomon, VP, AdSmart Programmatic, Advanced Advertising Products, and Strategy at NBCU; Prashant Upase, Head of Product for Growth and AdTech at Uber; and Liane Nadeau, Head of Precision Media at Digitas. Our moderator was LiveRamp’s Travis Clinger, SVP of Addressability and Ecosystem. 

Travis Clinger:
I
t’s great to have everyone here. Addressability is a huge topic—we’ve been talking about the third-party cookie for three-and-a-half years now. We’ve also been talking about the IDFA—I think the rumors first started circulating last June. Is the IDFA going to go away? When will Apple get rid of the IDFA?
We now know that early January 2021 is when Apple will require opt-in consent for the IDFA. We don’t know what the opt-in rates will be, there’s a lot of speculation that opt-out rates will be 70 to 90%. This is going to have a pretty big impact on the mobile advertising industry, both from the publisher and the marketer side.
Nola, let’s start with you. What’s your take on this from a publisher perspective? What do you anticipate the impact to be?

Nola Solomon:
Addressable advertising relies on being able to identify users in order to serve them the right message at the right time, and subsequently, to verify that through measurement. There are a variety of touch points that we use today. For mobile environments, it’s the mobile ID—the IDFA for iOS. We expect a large decline of opt-ins there. Essentially, we lose an addressable audience that we rely on in order to execute targeted advertisements. So we might have to shift towards less persistent metrics or probabilistic methods to target and measure. Ultimately, this means less data and insight for performance and targeting for both publishers and advertisers. 

Travis:
And less data and insights likely means lower CPMs on these sites, as you won’t be able to connect your data to that inventory. 

Nola:
Correct

Travis:
Liane, how are you talking about this? What’s the solution for marketers who either have a mobile app and want to suppress those users or who want to acquire mobile app traffic, new downloads, and conversion traffic? How are you approaching this?

Liane:
That’s a great question. I think the timing of Apple’s announcement was interesting because, while we’ve been seeing cookie deprecation for a few years now, it really came to a head when Google made the announcement late in 2019 that they were going to be deprecating the cookie by 2022. That’s woke marketers up to what had been a reality on Safari and Firefox for a while. But the timing was actually a bit fortuitous because we’re already in the process of reshaping how this industry executes addressable advertising and measurement. Throwing mobile into the mix right at the outset might actually be something that works in our favor because everything that’s been happening on desktops and web browsers is now happening on mobile.
As we think about advising clients in this new world, we’ve said this isn’t a shake-up for how we’ve done things, this is a complete restart to how we build an ecosystem. It will not only allow us to be addressable and measure performance outcomes, but also do it in a way that’s going to last. And for it to last, consumer consent must be at the core.
We see three buckets of opportunity right out of the gate. First is sorting through first-party data to make sure clients have the right assets and ensuring that they were collected in a way that’s permissible. Second, thinking about relationships with partners like NBCU, we want to think about context and other signals that might help us understand which impressions we want to buy based on who that might be and how much that impression is worth to us. And finally, measurement. Like you mentioned, we’re going to see an initial dip in CPMs because we’re not able to understand exactly which impressions are driving outcomes and which are not. So, it’s going to be a real challenge to understand where we should be putting our dollars. We need cloud ecosystems that are going to allow us to think about measurement in a different way than we have before.

Travis: 
Absolutely. Prashant, can you share your perspective on this and how this affects your business?

Prashant Upase:
Uber spends more than a billion dollars on ads, mostly on mobile, and our convergent funnels are on mobile too, so you can imagine how big of an impact this is going to have on our user acquisition and user engagement campaigns. But the biggest impact is on convergent tracking, meaning measurement. If you’re not able to measure your campaigns, you can’t optimize, so that area will be heavily compromised. The best solution for us right now is to move our convergent funnel to mobile web and ASoC web. We are actively experimenting with that, and there’s a good chance we may ditch iOS app install campaigns all together.
The second-biggest impact is user experience. We offer a lot of promotions for new users and we also offer a lot of bonuses and guarantees to our drivers, so if we can’t honor that between the marketing message we show them on different ad networks and what they see on our website, it equates to a bad user experience, and we don’t want to do that.

Travis:
Got it. You bring up conversion, and I think that’s a huge point. A lot of mobile marketing is designed to track app downloads and today, that’s done with the IDFA. Now, we know that the SkAdNetwork is coming out, and Apple has hinted at how that will work. From your perspective, is that a viable conversion option or do we not know enough at this point in time?

Prashant:
It’s an option, but we should put a perspective on that. SkAdNetwork just counts installs. It doesn’t do anything beyond that. So, that limits our ability to do meaningful measurement and know which campaign performed better or worse. And the bigger question is, again, going back to the user experience. We do a lot of promos for customers and messaging on bonus and driver earnings. If we can’t honor that, we can’t run the campaigns. It’s beyond measurement and optimization—it’s about user experience—and with this change, the user experience is broken, and SkAdNetwork isn’t a viable alternate solution.

Travis:
I really like how you emphasized user experience. We often talk about the third-party cookie going away and the IDFA dramatically changing, and we talk about perspectives from the marketing and publishing sides, but there’s also significant user impact to consider. Nola, let’s start with you. How do you think the IDFA change will affect the experience for mobile app users?

Nola:
It’s not just mobile apps, it’s also anything that’s in the app environment, and it affects different elements of the consumer experience. We mentioned frequency capping and targeting. With frequency capping, for example, if you don’t know who the user is, you can’t know if you’ve already served them a specific creative or campaign on a single publisher’s site or a cross-publisher’s site with different publishers. From a targeting perspective, a DSP might not be able to identify the user well enough to serve them a targeted ad at all, which ultimately means the ads are less relevant for the user, which is a loss for both the consumer and the advertiser and ultimately, the publisher, because it drives lower CPMs.
Another element of the user experience to consider is the opt-in pop-up that we’re supposed to show. There’s still a lot to understand about how we will customize that. Faced with a pop-up asking for data collection, a user might think, “what are you going to use this data for?” At the end of the day, it comes down to creating an environment where we’re protecting our consumers while also giving them the viewing experience they crave and driving a real impact for our advertising partners at the same time.

Travis:
Absolutely.

Liane:
Nola, I think it’s interesting that you talk about the opt-in. While people don’t like ads, we need to remind them that there’s a value exchange. By opting into advertising, you’re usually getting something free or for a lower cost in return. I think what happened with Cambridge Analytica and even Apple’s new ads emphasizing privacy, has made customers forget about the value exchange, and I think we need to reeducate on that. Consumers are probably going to get more spam because there’s no frequency capping allowed, so there’s less relevance to what they’re seeing, and I think that’s going to make people even more blind to advertising.
What you mentioned about opt-in is what I see as the long-term and potentially more grave impact. There’s very few places where consumers are going to say “yes, I’m okay with this person using my information to give me a better experience.” People aren’t going to be as comfortable saying yes, and that’s where you’re going to see a real decline in opt-in rates. We’re going to start to see a big gap between the premium publishers and the long-tail of the Internet. It’s really a scary situation if we’re limiting the source of people’s access to knowledge and information to a select few premium content providers.

Travis: 
I think it’s really important to remember that privacy changes often make the consumer experience worse, so while it’s important that we put privacy first, we need to do it in a way that gives the customer control without making them have to click through a pop-up or see the same ad every time.
Prashant, diving into measurement, I think we often talk about it in relation to conversion tracking, but in the app world, measurement is tightly correlated to suppression. It’s important to ensure that once a user has downloaded an app and engaged with it, they don’t see more ads for that app. How is Uber thinking about suppression in this new world?

Prashant: 
Well, there’s no way to do suppression on iOS, post-IDFA, before sign-up. It’s compromised, and there’s no real solution yet. Our campaigns are going to have to shift to targeting new as well as existing users, and performance is going to be hard to measure. Considering the impact on measurement and user experience, we may end up ditching app install campaigns on iOS altogether. We may just engage existing users on iOS and then target new users on desktop or mobile web inventory.

Travis: 
Liane, how are you advising clients on this? With all of these issues—frequency capping, suppression, targeting, measurement—what should clients be thinking about? Is there a silver bullet to this solution? How should they address these challenges?

Liane: 
There is absolutely no silver bullet, and I think that’s important for everyone to understand. One of the hardest things about being in an agency position right now is that your job is to advise clients that there’s no sure-fire solution. We’re hearing Uber say they might have to walk away from iOS. There isn’t necessarily a solve, and to be quite frank, I don’t think there will ever be one solve that addresses all of these problems.
It’s going to be a cobbled together solution. I think what’s also potentially a risk is that right now it might seem like the right solution to go all in with the walled gardens. If you only advertise on Facebook or you only work with Google for search—if you put all your eggs in one of those baskets—you might get a clearer picture, but you’re missing out on all of the open web. That’s a risk we’re trying to warn clients against because the challenge is, like we all know, data goes in but doesn’t come out, so you’re not able to look at things holistically. I think it’s really a valuation of where your most important channels are and how you approach them versus picking a step and going all in.

Travis: 
Nola, looking at it from a publisher’s perspective, what functionalities are you trying to add to attract and keep marketer dollars in-app as addressability becomes diminished?

Nola:
It’s all about first-party data. Publishers and advertisers that have direct touch points with users should authenticate with persistent identifiers as much as possible, whether that’s email address or phone number or other identifiers to use and leverage. Having that data tied to first-party identity is absolutely critical. I also suggest taking the opportunity to educate your users at available touch points about the value exchange. They’re sharing their data for their own user experience, but also for the service that you provide them.

Travis:
Interesting. There’s a lot of parallels here with the IDFA and third-party cookie deprecation. What lessons are we learning from third-party cookies that we can apply to IDFA? Liane, coming to you, should marketers be looking at these as two separate problems? How should they be approaching this?

Liane:
I think the root issue is that browsers didn’t just up and decide to remove these things. The changes are borne from consumer demand for more trust, transparency, and control, and I would argue that is the root of both the cookie deprecation and the IDFA going away. I think both are coming from the same place, and for that reason, they need to have the same solution in terms of consumer privacy at the core. But the technologies themselves are, of course, very different. I think IDFA had a lot of advantages over cookies because there was only one of them—you didn’t have to try and stitch them all together; it wasn’t different browser to browser. I think the way that we build technology to solve for both is going to be a little bit different, but the way we think about a solution has to be the same because it has to solve for consumer trust or else it’s going to be the next thing that goes in ITP 6.0.

Nola:
I completely agree. I think we need to look at what’s happening holistically and understand that these types of privacy changes are the new future. It’s not just happening in months and years and weeks, it’s happening by the day; and it’s not just coming from legislation, it’s coming from companies themselves, such as Google and Apple, in this case.

Liane: 
There’s an IAB quote that I love that came up with Project Rearc, and I’m going to butcher it, but it says that the future of addressability must rely on consent between consumers and first parties. And that’s either publishers or brands. It’s critical that brands and publishers get user consent, and also start to think about what they’re going to offer in return, because there has to be a value exchange. 
I keep going back to location as an example. If you use Uber but opt out of sharing location data, your Uber driver can’t find you. There is a very clear value exchange there. Or weather apps—they need your location to give you accurate local weather. 
There are apps that have a clear value exchange, and we need to communicate it in a way that lets people understand that their data’s not going to be used in crazy ways and that they’re getting something they want in return. I think that’s where we saw a lot of location subsidiaries and apps no longer able to get opt-in, but those who have a true value to offer will still have that opportunity.

Prashant:
One of the disappointing things is that Apple is communicating to our users that opting in to sharing data with the Uber app means we will track you across apps and different websites, which is not the case. Our primary interest is measurement and providing relevant offers. We don’t share our data with third-party apps or websites.

Travis:
We’ve been talking with brands and publishers who have decided that, because the IDFA is governed by Apple’s terms and conditions, they’re not even going to try to collect the IDFA, and instead will focus on CRM data and collecting their own authentication. Is that something that any of you have been considering?

Nola:
The way that I think about it is, we have an opportunity here to reinvent the world of digital advertising and the industry at large in terms of how we approach this, and I don’t necessarily think there’s any one way to approach it right now, given that so much is constantly changing. But we need to make sure that we are positioning ourselves to be able to offer our customers and viewers the most value, and in order to do that, we have to leverage a number of different strategies rather than only thinking about it one way or the other.

Prashant: 
For Uber, CRM was always a big challenge, post-user acquisition or post-sign-up. We relied on older channels quite a bit and we continue to do so, but user acquisition is also critical. CRM cannot do anything there, so we have to go out in the wild. We have to figure out the best media channels in those particular regions or countries that we can rely on to drive awareness and provide messaging on the value that Uber has to offer.

Travis: 
Liane, you talked earlier about the philosophical discussion of why are these IDs going away, and so to build on that, what’s next? I feel like in adtech, it’s always, what’s the next shoe that’s going to drop? Now, we’ve had the third-party cookie, we’ve had the IDFA, and we know this is a result of the consumer trust issue. Do you see the Android ID going next? Where do you see the IP address? What does the next 12 to 18 months look like?

Liane:
I think it’s two buckets to that answer. One is the Android question, and I think we can learn a lot from the way Google approached the Chrome decision and apply it to how they’re going to approach Android. I would say we can expect something similar, especially considering the way that Apple’s actually gone to market consumer-facing with these privacy ads. They’re kind of funny, but they’re also intended to scare consumers and differentiate Apple and iOS from Android and other devices, to make them realize that Apple’s taking their privacy seriously. I think Android and Google have no choice but to follow suit.
I would say it’s probably going to be a little bit more of a slow roll, similar to what they did on Chrome. But to your question about what else is going to go, I think it’s realistic for us to expect that anything that can be tracked back to an individual or a specific user is going to go away, because again, it all goes back to that same consumer trust problem.
If there’s a work-around that we as an industry have found, it would behoove us to recognize that. The next ITP, ETP, two point, three point, 4.0 is going to be able to find that work-around and stop it. We need to build something that’s going to address the root issue, which is consumer privacy. I do think there’s a couple of providers and partners out there in the ad tech middle, if you will, coming up with solutions that rely on those other identifiers as a way forward, but it’s a little irresponsible for us to start building solutions around them, because I think they’re just the next to go.

Nola:
I totally agree with that. I think, at this point, privacy is a strategy. It’s not just about compliance, and when we think about the identifiers that we’ve relied on—the ones we know and love—the clock is ticking on all of them. They will all eventually fall by the wayside. Hopefully, what comes out of it is a more consumer-focused, privacy-centric method of transacting addressable advertising at scale, and that we all come together as an industry to create some cohesive standards.

Travis: 
Prashant, LiveRamp’s view is that CRM consent is different from the IDFA consent. The IDFA consent is restricted to the device, whereas CRM is covered through consent between the user and the publisher. For example, if a user has an Android device and an iPhone and has the Uber app on both, their relationship would be with Uber or with NBC, not necessarily with those device IDs. We are actively encouraging more publishers and marketers to get consent at the user level versus the device level, but that’s still something that probably will be determined a bit in the future.

Prashant:
Do you include targeting users on third-party surfaces as part of CRM consent?

Travis: 
Yes, but only using the CRM data, not device data. I think that’s the important caveat. You can use your CRM data to match to a publisher CRM, so Uber could target a user on NBC’s apps or their display sites, but they’re not using device data for that.
Liane, a question for you. Retargeting in-app—how do you see that being impacted post-IDFA? Is retargeting still going to exist in a mobile and app world?

Liane: 
That’s a great question. It’s going to depend on how far Apple goes with the regulation, but if things go the way they’re looking, retargeting in Apple won’t necessarily be a part of any marketer’s strategy. But I do believe that in the IDFA and the iOS world, you need some sort of identifier and device ID. In the mobile web and the desktop web world, we’re going to have first-party cookies. Those are still going to be in place, and that’s something we can build a framework around, but in mobile, without that device ID, there is no first-party cookie—or any cookies—in the app experience. So, no, I don’t believe that’s going to be possible.

Travis:
Nola, a question for you. As you’re looking at identity, who are the key partners you’re looking at to connect your different identity assets? Along with LiveRamp, how do you see The Trade Desk and Criteo fitting into this? Are there other partners that you see? Is it going to be a group of partners, is it going to be one partner, hundreds of partners, what’s the future look like?

Nola: 
We need to evaluate all of the solutions out there and assess how they’re similar and how they’re different and where they plug the gaps or overlap with the data we already have. As I said before, I don’t think there’s one solution out there that rules above them all, but they’re all addressing, as far as I’ve been able to see so far, on slightly different areas of the marketplace, and so in that sense, they’re all very interesting to evaluate.

Travis:
Prashant and Liane, anything to add about how you’re thinking about partnerships?

Prashant:
We have not taken any active steps in this regard. Mostly, as I mentioned already, LiveRamp and other solutions are what we are evaluating.

Liane:
I think for us it’s similar. As we think about the partnerships that we have now, we’re developing those—digging in to see who’s going to be future ready and who might not be. But we’re also faced with new partnerships we need to establish, and one of them is with the browsers. We haven’t had a relationship with browsers before, but I think there are new players emerging, like Brave, who might have a solution that we need to consider. On the partnership side, we’re starting to think about what those look like, both inside walled gardens and outside. I think that’s something most marketers are going to have to take a critical look at. 

Travis:
I’ve got a bit of a controversial question here, so feel free to decline to answer, but I wanted to ask because I think probably a lot of folks in the audience want the answer, so I’ll just throw this out there for any of you to accept it. Do you see brands using solutions on one side of the bidding equation, such as Trade Desk Unified ID 2.0, or do you think solutions such as ATS are better and more neutral and are impartial to one side of the business?

Liane:
That is controversial. I would argue that both solutions are on the buy side. Yes, LiveRamp has partnerships on both the sell and the buy side, but I don’t know that I would say that either solution is fully baked yet, because the industry is still playing catch-up. I will say, in terms of what I know about The Trade Desk’s solution, I appreciate that it doesn’t cost money. Also, it’s built around IAB’s Project Rearc, so it’s not something that’s only going to work with them. That’s the value I see in what LiveRamp has brought to bear—the ability to be neutral between whomever you’re buying through. I think LiveRamp has also taken the role of connector and respects that first-party relationships have to happen through brand and publisher. 

Travis:
Perfect. Just a call-out for the audience as well, we are committed to being interoperable with Unified ID 2.0 and are actively collaborating with The Trade Desk on that. We would agree they are complementary and in no way competitive. Since we’ve got just one minute left, can each of you please take 20 seconds to share some advice for the audience? What’s one thing they should take away or do after this session? Nola, do you want to kick us off?

Nola:
Sure. As you’re thinking about your own businesses and the companies you represent, do you have direct touch points with the consumers in one way or another? If you do, what are the solutions that you are putting in place for that first-party identity collection? How are you going to aggregate all of that on the back end so it’s actionable?

Prashant:
From Uber’s perspective, we are thinking about it from first principles’ perspective. Can we make sure that the user experience isn’t compromised? If you can deliver on that then we can preserve the value of the user and hopefully then marketing campaigns can deliver.

Liane:
I saw a question I loved in the Q&A that says, “Are we basically going back to the 90s here?” I’ll say that going back to fundamentals isn’t a bad idea. I think we were a bit irresponsible with the data and the technology and the ability to hunt down users. We created this mess and this is a response to what we were doing with that data and with those ads. So maybe we should go back to things like context and general reach frequency buying and using lift in sales as an indicator that marketing is working.

Travis:
Awesome. Nola, Liane, Prashant, I really appreciate you joining today.

Daniella:
As Travis mentioned, The Trade Desk’s Unified ID 2.0 is now interoperable with LiveRamp’s identity infrastructure; you can read more about our expanded partnership in the show notes.

Thanks for listening to “Saying the Quiet Part Out Loud,” and be sure to subscribe and leave us a review on Apple Podcasts.



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