Caitlin Borgman, Commercial Director of ID5, talks about the future of cookies in advertising

As the advertising landscape evolves in response to the growing demand for data privacy and security, ID5 remains at the forefront of the market identity solutions. In a world that increasingly values ​​consumer privacy and cross-platform measurement, ID5 is helping advertisers navigate the transition to a cookieless future.

From MarketingDirecto.comwe talk to Caitlin Borgman, ID5 Commercial Directorabout how the company is adapting to changes in advertising technology, the challenges ahead and the innovative solutions driving its success, ensuring advertisers are prepared for a safer, more efficient and sustainable advertising ecosystem.

As the year draws to a close, do you think 2024 has lived up to its title as the “year of identity” in ad tech? What have been the main milestones and in what aspects do you see room for improvement?

Yes and no. We’ve almost reached a tipping point where more alternative IDs are circulating than cookie IDs. Once Chrome implements the cookie opt-out mechanism, we will see critical mass reached and we will truly be in a post-cookie world and we will see this proliferation spread across all digital channels. Once Google implements the new opt-out mechanism in 2025, the number of alternative IDs in circulation will be greater than the number of cookie offer requests.

More importantly, the conversation around identity in advertising has changed. Most market players recognize that identity in advertising is much more than a cookie. Identity refers to greater addressability and measurement across media and platforms that adheres to consumer privacy laws, expectations, and provider data protection. That attitude and awareness has undergone a dramatic change in the last 24 months.

This summer, Google took a pivot by putting the decision to accept cookies in the hands of users. How has this influenced the industry’s approach to identity solutions?

Google’s pivot doesn’t change advertising technology much. Google’s move toward developing a user opt-out mechanism simply puts deleting cookies in the hands of Chrome users, rather than tasking Google with turning them off. So, although cookies can be targeted to a limited number of Chrome users, the majority of users will not be able to do so. To operate in this new world, ad tech companies will have to turn to identity solutions to overcome signal loss.

Privacy regulations vary greatly from region to region, from the advanced frameworks of Europe to the more relaxed approach of the US, to emerging markets such as Brazil. How do these differences influence identity strategies on a global scale?

The European data protection landscape is evolving with stricter enforcement, broader scope and emerging regulations. Countries such as Spain and Romania are increasing fines, while enforcement is expanding beyond browsers to areas such as audio, in-app and CTV. AI-driven advances are prompting closer scrutiny of data sharing, especially cross-border, as the AI ​​Act reshapes regulatory compliance. Data portability rights are increasing, allowing users to transfer IDs between providers, while the upcoming EU ePrivacy Regulation will redefine privacy rules in a world without kitchens in 2025.

On the other hand, in the US we are seeing state privacy laws come into play, further fragmenting the privacy landscape. The incoming administration has shown no signs of prioritizing a federal privacy law, so it’s unlikely we’ll see it go into effect in the next few years. In the absence of a comprehensive federal law, advertisers targeting the American public will have to comply with the highest common denominator when it comes to U.S. privacy laws, which are currently the CCPA and CPRA.

Identification solutions that prioritize privacy compliance across channels and jurisdictions, such as ID5’s privacy-first approach, will be best positioned to adapt and thrive in this new environment. On the positive side, next-generation identity solutions incorporate privacy by design and offer comprehensive compliance coverage to help operate legally in a fragmented market.

Encrypted IDs and identity resolution are expanding their impact. How do these technologies contribute to areas such as preventing advertising fraud and reducing the carbon footprint?

One of the lesser-known benefits of encrypted universal identifiers is their ability to improve ad quality by disintermediating bot and fraudulent traffic. Using encrypted identifiers for ad targeting and measurement minimizes the ease with which bad actors can easily spoof inventory and hijack audiences, as they can only be accessed by parties licensed to decrypt an identifier. Additionally, encrypted identifiers prevent data leakage for publishers and media owners, enabling secure data sharing and improved user verification across the programmatic supply chain.

Furthermore, the programmatic bidding process is incredibly demanding on the environment, given the volume of data and the speed at which decisions are made about whether and how an ad should be published. A study by Sincera and ID5 that evaluated more than 63,000 domains found that almost 23% of network traffic is used for cookie synchronization. By eliminating the need for this unnecessarily energy-intensive process, universal IDs help minimize the footprint of carbon, acting as a funnel for the information used in the bidding process. If buyers only bid on audiences associated with a universal ID, they minimize the amount of data needed to discern whether they are bidding on an impression or not, thereby minimizing the energy used in the bidding process and the resulting carbon footprint.

With Chrome expected to roll out opt-out mechanisms soon, what opt-out rates does the industry anticipate and how can businesses adapt to this change?

Although Google has yet to reveal more details about the new cookieless user experience, including the proposed timeline, methodology, or expected opt-out rates, one thing is certain: the cookieless train has already left the station. According to a recent ID5 survey, 80% of respondents foresee the launch of the new opt-out interface in the first half of 2025. Since Google’s announcement, the proposed opt-out mechanism has often been compared to the Apple ATT. However, Chrome’s cookie opt-out rates are expected to exceed those of ATT, with estimates ranging from 60 to 80%. Businesses can adapt by testing and adopting cookieless solutions today.

Channels like CTV, audio and gaming are growing rapidly. How is the identity space evolving to address these new opportunities?

The identity space is rapidly evolving to keep pace with the growth of channels such as digital television, audio and gaming, each of which presents unique opportunities and challenges. In 2024, CTV has become a hot topic, with platforms like Netflix introducing ad-supported plans, Amazon expanding its footprint, and FAST channels continuing to boom. Although CTV stands out for being unaffected by cookie deletions and signal loss, its rapid growth has also highlighted key challenges.

However, the lack of a unified identification framework across emerging channels such as CTV, audio and gaming makes it difficult to measure impact, standardize approaches and resolve privacy issues, ultimately limiting the channel’s potential. .

This is where they come into play. solutions as ID5. By providing a universal identifier, the ID5 helps connect different devices. For example, you can show if someone who saw an ad on their TV made a purchase on another device. With these types of tools, advertisers can improve segmentation, perform more precise measurements and optimize campaigns more intelligently.

Looking ahead, how can identity play a critical role in creating a more sustainable, secure and privacy-friendly future for the ad tech ecosystem?

Universal IDs offer a unified, privacy-friendly solution for accurate targeting and personalized advertising, ensuring consistency across platforms and devices. They increase data security, reduce ad fraud, and improve transparency by enabling secure data exchange. By streamlining identity resolution and optimizing ad delivery, they increase campaign effectiveness and ROI while minimizing waste. Additionally, universal IDs support a sustainable advertising ecosystem by reducing redundancies and the carbon footprint of digital campaigns. This holistic approach balances personalization, privacy and sustainability, transforming the digital advertising landscape.