The lowdown:

• Google has outlined a plan to limit tracking cookies on its Chrome browser, following moves by Apple's Safari and Firefox
• It carries widespread implications for current performance marketing, audience targeting and measurement
• Raises renewed focus on "contextual" versus "behavioural" advertising 
• Managing frequency without cookies and robust identity management presents enormous challenges for marketers
• Will hit agency trading desks and advertiser in-house programmatic operations
• Could slash the value of media inventory not attached to a signed-in or verified user ID 
• Set to strengthen Google's advertising dominance
• Puts personalisation strategies under scrutiny  

Former Lion, Virgin and Diageo marketer Jon Bradshaw has been digging deep into the effectiveness of personalised ads. From Harvard Business Review studies to academic research, many of the assumptions industry makes about personalised ads are not what we think. "Personalisation works," he says "but it's not universal". Bradshaw, who runs a marketer capability practice, Brand Traction, is an ardent advocate for the work of UK-based Dr Peter Field and Les Binet on the rule-of-thumb ratio that 60% of media budgets need to back longer-term brand building activities and 40% allocated to performance, or response-driven tactics. New research out last week from Field and Binet says the rule applies equally to B2B marketing as it does to B2C.  

"While targeting and personalisation does drive effectiveness, people switch-off when the cookie-driven creepy stuff follows you around the internet," says Bradshaw. "The effectiveness of personalisation in that environment declines pretty rapidly as we get away from contextual sites. So in some ways a shift back to contextual advertising might drive up effectiveness."

Verizon's head of media performance, Sebastian Graham, is not as black and white on the return of contextual-based advertising. That is, placing messages in online environments relevant to their content - like travel, cars, golf or food. But he's equally insistent on the work of Field and Binet. Graham also argues Google's coming changes to third party cookies - those bits of code that are dropped into a user's web browser which then quietly follow them around the web gathering behavioural information - will have a bigger impact on direct response and performance marketers. He thinks it should serve as a catalyst for agencies and media owners to drop traditional media success metrics.

"Contextual advertising is really important but behavioural targeting isn't dead by any stretch," Graham suggests. "Verizon has 10-14 million Australians coming to its sites every month and we're making a shift to what we call membership. That is, people who come 20 times in a 30-day period. They are really strong, rich relationships ... that still deliver strong behavioural advertising as well as contextual ads for where those audiences live. For anyone who doesn't have that combination of culture [content] and code [technology] this is a really, really difficult time to go through."             

Free from allegiance to any particular media company since leaving News Corp in January, independent media consultant Cameron King is forthright. He thinks local media conglomerates and independent publishers are unlikely to stage a viable alternative to Google, Amazon and Facebook in a post-cookie world of identity management unless they join forces for scale. And marketers, as fractured as their time already is, will be left with few partners if they ignore the current signals. "The CMO practice needs to become much closer to what is happening technically, operationally and executionally in how their money is being spent," he says. "They need a much better understanding of these changes and what impact it's going to have on media owner relationships, their media partnerships and how business results are delivered. If they don't they'll wind up spending a lot of money with one or two global operators and in 10 years time they'll wonder what happened."

King shoots equally straight at media owners. The key agency holding groups are already moving to people-based identity solutions, even as their agency trading desks, loaded with cookie-based advertising inventory, are challenged.

"Agency trading desks and others who are heavily reliant on stitching together media solutions will be under pressure," says King. "The strategy and thinking is there for each of the holding groups but whether or not media owners are responding and working with those holding companies to help them build out the next iteration of trading models is yet to be seen."

There are, of course, reservations among media. Agencies have in the past gamed publisher audiences for their own gain. Identity management, some fear, could be the next one if not managed properly. Still, King says identity solutions for all players in the marketing supply chain should be a priority.

"The value of cookies is diminishing. The response to this means you need a relationship with a consumer where they allow you to track them. In order to assemble something that resembles the dominance of Google, Facebook or Amazon, the challenge is in building a scaled identity solution that enables you to meaningfully compete. I don't see a strong response from Australian media owners in that respect," says King. "Each of the broadcasters have strong solutions around their declared IDs but the non-broadcast world is ... a little lacking." 

Others argue that even some of the broadcasters are well behind on this front but whatever the case, identity management is a massive challenge, an opportunity, for all players in the marketing supply chain. But there's not a lot of time.