Targeted Advertising Testing, What Does It Actually Look Like?

Chris Hogg, EMEA Managing Director, Lotame

After pushing back its deadline for third-party cookie removal to 2023, Google recently followed up with the current roadmap for its contentious “Privacy Sandbox”. While this roadmap spans the next two years, it’s important to note that the initial “discussion” phase for Google’s FLoC (Federated Learning of Cohorts) solution is due to end in Q3 2021.

As Google prepares to move forward with testing FLoC – a.k.a. phase two – the digital industry is encouraging brands to use this time for exploring, testing, and evaluating all the alternative tracking solutions. From FLoC to probabilistic and authenticated IDs, marketers have a lot to consider.

So, how do they go about this testing and evaluation? And what should they be considering as they explore potential options?

The global open web

When digital users log in to a website or an app, they become part of the global open web. Most often, their email addresses are used to create an identifier, which then unlocks specific content or services online. By 2022, the most optimistic predictions expect 1 in 5 digital users to be authenticated. Although this marks commendable progress, it still leaves 80% of consumers unaccounted for; and winning their engagement is as big a priority as targeting authenticated users.

 

This is especially true for businesses seeking to expand prospecting capabilities – which over a third (36%) of marketers want to see increased investment in – alongside the means to drive other top-funnel activity. With this in mind, marketers should adopt identity solutions that allow them to operate in both the authenticated and non-authenticated or anonymous web.

IDs can be enriched or empty

Regarding IDs, marketers have a choice between enriched and empty ones. Enriched IDs can offer them more than 200 behavioural attributes, providing a wealth of privacy-friendly data that supports all elements of responsible and effective advertising, including targeting, optimisation, reporting, and beyond. However, some ID solutions are only designed to use first-party data, posing a challenge to achieving scale and accuracy. This is because they rely solely on one contextual visitor point of view, typically that of the publisher.

Some IDs can also come with fees attached, along with further added costs if marketers want to enhance them with relevant data and enable addressable targeting. It is critical to keep this expenditure top of mind while searching for optimal ID solutions.

Transparency is integral to privacy

It’s not enough to enquire whether an ID is privacy compliant. Regulations and guidelines vary between regions, countries, and even states in the case of the U.S. To truly understand an identity provider’s outlook on user privacy, marketers can use the EU’s GDPR as a strong benchmark for compliance. As one of the most thorough examples of data privacy regulation, the GDPR champions transparency, accountability, and users’ control over their data.

A responsible identity partner will therefore empower consumers with the ability to access, request, and remove their data at any time. Additionally, partners can practice data minimisation, use accountable IDs across all channels, and offer auditable trails. In comparison, some providers obscure their data sharing practices and tracking methods from users, which significantly impacts transparency. To ensure they onboard future-proofed ID solutions, marketers should work with partners that provide clarity around their actions.

Check the interoperability of ID solutions   

With many ID solutions on the market, it is important to assess how capable they are of communicating with one another. For instance, if ID solutions aren’t readily interoperable, then marketers might need to account for translation activity costs within their budgets. What’s more, this could lead to technical challenges when leveraging IDs between platforms and regions. Interoperability also affects how marketers’ data enrichment translates across and between IDs, meaning consumer profiling and segmentation could be lost as a result. When two-fifths of marketers want more investment dedicated to defining relevant audience segments, this is a key priority.

What should a testing template look like?

After carefully considering which ID solutions are best suited to their needs, marketers must test their performance. Testing templates will vary depending on use cases, but there are multiple approaches marketers can take.

For example, when a publisher page deploys a user ID module, cookieless solutions can be used to pass User IDs to Supply-Side Platforms (SSP) where it is paired with first-, second-and third-party data and packaged into a Deal ID. In some cases, the User ID is passed further upstream to supported Demand Side Platforms (DSP) with the matching taking place. The DSP wins the impression and serves an ad on the publisher page, giving marketers addressability and expanded reach without using cookies.

Alternatively, tests can be implemented directly with publishers utilizing Google Ad Manager (GAM). In this case, the identity partner provides the first-, second-, and third-party data on the publisher page to produce audience segmentation in real-time, which is then passed into GAM as key value pairs. This qualifies for an audience being purchased by a marketer and serves an impression.

To demonstrate this method in practice, Lotame worked with an iconic footwear brand that had a direct relationship with Digo, the premium Hispanic audience network – to set up A/B testing using GAM and Google DV360. For the first method, Digo passed audiences into the DSP via third-party cookies, while the second method relied on client-side activation, enabled by Lotame Panorama ID, to pass audiences to GAM/DV360 via key value pairs. The identity solution method generated 107% more viewable impressions and almost 10x uplift in CTR – at 10% of the cost in comparison to cookie-enabled environments.

When evaluating an ID solution, marketers must ensure it delivers on all their requirements. Open discussions and rigorous testing with providers are an essential part of this journey. Only then can marketers develop optimal, privacy-first strategies for the approaching post-cookie ecosystem.

SIGN UP TO SKILL UP
The All Access membership allows you to discover 500+ hours of best in class thought leadership