The Future of Digital Advertising is Here.

The Wakeup

As someone who spends the first thirty minutes of my mornings mindlessly scrolling to catch up on the latest advertising and marketing technology news, I'm used to waking up to press release headlines bragging about "the next big thing". Every once in a while though, smaller, less flashy announcements startle me awake and make me question everything just a bit differently.

Well, that happened today as I glanced over the news that Google Ads will be deprecating Similar Audience Segments. The announcement, while by no means a surprise, got me thinking...

It's no secret that the digital advertising landscape is going to shift reliance away from third-party cookies. But what if that future is already here - earlier than anyone expected? Sure, some third-party tracking solutions are still "functioning", but what if we've already crossed the chasm where not heavily investing in first-party data solutions actually prevents organizations from achieving their goals?

A Maturing Landscape

Before our very eyes, every major advertising platform and digital publisher is continually innovating customer data technologies - deploying the capabilities needed to ensure continued success when the final axe comes down on the legacy third-party tracking solutions that have built their advertising empires.

Advertising Platforms like Facebook, Google, Twitter, Reddit, Inc. have led the way; deploying CAPIs (Conversion APIs) that ensure advertisers can overcome the signal loss from less-performant client-side tracking pixels. These platforms will continue to evolve to rely primarily on server-side tracking solutions while also implementing privacy-centric changes to power audience targeting solutions (ex. Google deprecating Similar Audience Segments).

• “Google says advertisers who use optimized targeting on Display and Video 360 can see, on average, 55% improvement while using first-party audiences”
• “Boxy Charm, an American beauty subscription box provider, increased its four-month retention rate by 23% after implementing the Facebook Conversions API”

The Shift from Pixel-Based Tracking to CAPIs

Digital Publishers like Bloomberg have shut off third-party advertising platforms (ex. Taboola) in favor of in-house publisher advertising solutions that rely on their first-party audiences. It won't be any surprise when the dominoes continue to fall and many more publishers soon follow suit. These private walled gardens will turn to proprietary audience activation and data clean room solutions to offer advertisers access to their soon-to-be treasure troves of customer data.

Third-Party Data Marketplaces like Liveramp are evolving their product positioning and offerings to rely on first-party data. These organizations that once dominated the customer data world thanks to their massive stores of third-party data are pushing to evolve in fear of losing relevance to the changing tides of the advertising ecosystem.

Customer Data = Success

As we enter this new era of digital advertising, customer data infrastructures will become the arteries of the modern digital organization. The ability to capture, store, model, and activate first-party customer data (in an efficient & privacy-compliant manner) will become a fundamental pillar that defines their future success. New market leaders will emerge, taking over the reins from those relying on legacy data infrastructures.

The Modern Customer Data Stack

With each headline coming out this week and in the weeks to come, I challenge you to think about if your organization is in a position to succeed in this new era of advertising.

The future of digital advertising is an audience game built on first-party customer data. And that future is here - whether organizations are ready for it or not.