MAdtech Point: Chaos theory, its relevance in MAdTech and the New PII

While AdTech is about inventories, MarTech is always about identities. And the twain never met; not sure it will, even though the industry is calling out for its integration, writes our columnist Gowthaman Ragothaman.

By  Gowthaman RagothamanSep 18, 2023 11:33 AM
MAdtech Point: Chaos theory, its relevance in MAdTech and the New PII
Privacy regulations are redefining the way consumers are discovered and engaged, particularly when it comes to securing and managing consumer consent. The power is shifting back to the consumer and the advancement in technology is driving a new set of innovations including the tokenization of consumer engagement. (Representative Image: Alexander Sinn via Unsplash)

Chaos theory is all about the studies of apparently random or unpredictable behaviour or events that are governed by some common deterministic laws. Last week three such seemingly disconnected events happened in the MAdtech world.

Google announced the readiness of Privacy Sandbox

Google had launched nine origin trials (OTs) to fix the privacy related challenges in their Chrome browser as late as Q1, 2021. It recently announced that all these nine OTs are closed and ready for roll out on a small percentage of the browsers. These nine OTs are across - Fighting spam and fraud, showing relevant content and ads, measure digital advertising and strengthen cross site privacy boundaries. It took nearly two and half years to conclude these trials to release the functioning APIs for testing.

Basically, we have been living with all these privacy related challenges all these years. Never mind! And probably live with it for some more time, till the Chrome browser is fully declared privacy safe. As per the current timeline one percent of the browsers will be “turned on” for these features by Q1, 2024 before going live in full by Q3, 2024. It is anybody’s guess now as to how all this impact the overall effectiveness of an advertising campaign. Since we do not have cross screen benchmarks, all of us are like the five blind men trying to explain an elephant.

Horizontal integration in AdTech

A recent feature from Digiday called out that the leading and near monopolistic DSP, The Trade Desk is now sending out all bids on behalf of its clients whose campaigns match the inventory up for sale, even if their bids are below the price point at which publishers and SSPs value that inventory. All the executives interviewed for this story by Digiday agreed that SSPs and resellers are in a position to lose out on revenue from this change. In my view this is just the tip of the iceberg. This is not about DSP vs SSP, but a fundamental challenge that is happening between aggregating supply and aggregating demand.

During my recent chats with a leading agency person who oversees their programmatic operations, it is clear that brands are now paying more to get the same reach, as the deprecation of third-party cookies continues to render audience segmentation and lookalikes less and less effective. In the absence of reliable and consistent consumer signals between demand and supply, the bid price is anybody’s guess and will surely go for a correction. So, unless and until the inventories are mapped to identities, efficiency of programmatic advertising will be under stress.

MarTech goes AI!

While AdTech is about inventories, MarTech is always about identities. And the twain never met; not sure it will, even though the industry is calling out for its integration. Deprecation of third-party cookies is the perfect storm that can make this happen. However, there is too much that is happening in parallel that the Adtech enterprises simply do not have time or monies to focus. Salesforce had their Dreamforce event this week an impressive gathering of speakers bringing Data and CRM with AI. There is so much to do with customer data today.

Privacy regulations are redefining the way consumers are discovered and engaged, particularly when it comes to securing and managing consumer consent. The power is shifting back to the consumer and the advancement in technology is driving a new set of innovations including the tokenization of consumer engagement. While it is relatively simple to manage consent in all other direct marketing channels, it is extremely complex when it comes to advertising. Identities and their consent need to be mapped to inventories to remain compliant.

All these three seemingly unrelated events are governed by one deterministic law, i.e.., responsible use of consumer data. Google, The Trade Desk and Salesforce are trying to address this very fundamental need from where they stand. One is trying to reimagine their existing technologies; the other company is stepping into horizontal integration, while the third enterprise is getting ready for the new world order, where the power is shifting to the consumer.

Responsible use of consumer data can be demonstrated only when the provenance of consent and its actions are established. MAdTech is all about identities and impressions. Whether it is the Privacy Sandbox, horizontal integration or Generative AI, it will all boil down to the New PII. The Provenance of Identities and Impressions.

First Published on Sep 18, 2023 8:54 AM

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