What you need to know:

• Both publisher and ad tech player, Yahoo is running the rule over dozens of alternative ID solutions globally – 32 for its demand side platform (DSP) and 25 on the supply side (SSP).
• But locally, Head of Data Dan Richardson said match rates between publishers and brands using cookie alternatives are as low as 15 per cent.
• That means contextual advertising will need to be central to brand strategies, said Richardson, but few marketers are testing the waters.
• "Google is going to start migrating people to its new sandbox solutions at the end of this year. You don't actually have a huge amount of time."

Identity crisis

Yahoo has amassed 5 million Australian IDs. But Head of Data Dan Richardson thinks AI-driven contextual targeting will become a mainstay of targeting on the open web – where nothing will replace cookies.

“We need to be clear with people: Having an email based identity solution, whether it's our Connect ID that we produce from our direct relationship with our logged-in members, or using an industry solution – none of those are scalable enough to cover the majority of the web.”

Richardson advises brands to start testing contextual approaches now to be ready for 2023, when Google says it will scrap third party cookies. At present, “there’s not enough of that happening.”

Whereas most of Australia’s large publishers appear intent on building out their own identifiers – becoming quasi-walled gardens in the process, Yahoo is both a publisher and an ad tech player. As such it’s running the rule over dozens of alternative ID solutions globally – 32 for its demand side platform (DSP) and 25 on the supply side (SSP).

“It’s not [Yahoo’s proprietary] Connect ID or nothing, we are agnostic … But there is a lot of work that goes into evaluating whether a solution is scalable … [the priority] is in order of scale and demand from the market,” said Richardson. “That’s the difference between us and a walled garden. If an advertiser or a publisher wants to use an industry solution, for example LiveRamp, we’re already set up to match our email anonymously within LiveRamp. But there are so many to integrate.”

Contextual crunch

Locally, Richardson said match rates with advertisers’ data range from 15-30 per cent, which is why he reiterates the need for brands to look more seriously at contextual targeting.

“Contextual is going to be a big part of the internet going forward. It doesn’t require that persistent identifier, which, if not explained to consumers properly, is a bit on the nose,” he told Mi3.

“The reality is there are going to be a lot of identity solutions that are heavily modelled, which are using data that could be second or third hand, which is something marketers should be aware of,” said Richardson.

“It only takes one screw up to ruin a relationship with the consumer – while people are willing to share their data with the brand they like, that can easily turn. So now is the time to start aggressively testing and figure out what’s going to work,” he added.

“Google is going to start migrating people to its new sandbox solutions at the end of this year. You don’t actually have a huge amount of time.”

A version of this article first appeared in Mi3’s Post-privacy, post-cookies report, alongside interviews with more than 30 industry experts. Download your copy here.