Jon Fletcher 2021-01-29

The publishers that never needed third-party data

There's an idea that some companies are too big to fail. As the publishing industry scrambles for a solution to the blocking of third-party cookies, publishers with a monthly audience similar to the population of an EU member state, are sensing the opportunity to capitalize.

The block of third-party cookies probably won't do all that much for user privacy. But, it will kill off small and unprepared publishers. It will devalue ad networks. Rather than every publisher having access to the same bank of data on each user, rich first-party user profiles will be in the hands of a few monolith brands. 

As the landscape shifts, advertising is an oily green river. It flows along the path of least resistance to the richest soil. Usually, this means Google, Apple, Amazon, and Facebook, but tier one publishers will also be able to divert some of this slow train to their own audience first-party data sets. 

One of the first publishers to publically make a first-party data play has been The New York Times. In Europe, they have already started removing third-party tracked ads and are now working on transitioning all their advertisers onto their own platform. 

A first-party marketplace 

The platform works by offering advertisers 45 proprietary first-party audience segments to direct ads towards. Within these segments, advertisers can drill down further into 5 categories: age, income, business, demographics, and interest. By the end of this year, The New York Times plans have introduced 30 more segments. 

With a direct relationship between advertisers and audiences established, they are then able to offer their own set of ad formats and spread their advertising across their other digital products, such as email and podcasts.

With an audience of known subscribers that dwarves many publishers' monthly visits, The New York Times has the luxury of options. 

"This can only work because we have 6 million subscribers and millions more registered users that we can identify and because we have a breadth of content," says Allison Murphy, Senior Vice President of Ad Innovation. 
Not only do they have a huge audience scope to offer advertisers, but there are also millions of content URLs that users visit, slowly marking out the property lines of their interests. The world of this single publication contains enough depth for it to effectively replicate the scope of audience variation that third-party tracking offered.

In addition to straightforward context linking (sports page, sports ad), first-party data can be used to target more abstract connections between content, emotion, and eventual buying decisions.

Context, behavior, and emotion can all be targeted

Combining the stories readers click on, The New York Times is able to offer advertisers unique data products. Thanks to the reading information contained in this first-party cookie, advertisers can reach audiences that are motivated to 'take control of my finances'.

Grouping articles by the dominant sentiment then allows them to target based on emotion. You can pick and place your adverts in front of an audience that is deemed to be feeling self-confident or adventurous. These create wild, shifting data products that the publication can market to advertisers, multiple times over. 

New product? Try it out on financially minded 40-somethings with an interest in diplomacy that woke up today and just felt more competitive than usual.

After the black box of programmatic targeting and the unseen supply chain, this simple, three party process appeals to advertisers. Sasha Heroy, senior director, ad products and platforms, spoke on the appeal at the Digiday Publishing Summit

'' The message we hear is, 'of course we prefer first-party data, so much third-party data is known to be unreliable. ' We're in the process of letting advertisers know our approach and whether we've selected the right set of audience segments and how they can evolve. '' 
And evolve they will. The platform will become more sophisticated as more user data is fed back into the machine. As well as understanding emotions, topics, context, and motivations, The New York Times will soon understand how advertising fits into these journeys. 

Data will tell them how many ads an 'inspired' reader in the art section needs to see before the effectiveness plateaus or they click. They can tell advertisers how deep reds seem to stand out in sports contexts or that aggressive copy seems to resonate with their 'competitive' audience clusters. 

As well as the scale of The New York Times's audience There is also a certain cache to advertising directly with a brand like the New York Times that gives this first-party marketplace an added shine. You're no longer throwing advertising at a network of sites that you wouldn't really choose to saddle up your brand with, you're now on the glossy pages of a real, tier-one publisher. 

First-party futures are an elite club

One of the reasons advertising models based on third-party cookies found such a strong foothold was because they took away so much of the work from publishers. First-party data, used in this way is only an option for an exclusive few. You need major volume, user and advertiser trust, and the resources to scale it. 

Allison Murphy, Senior Vice President of Ad Innovation at The New York Times explained 

"We hired a large team specifically to support this year of a dozen people. The effort has touched at least 50 people and many more in every part of the company to get this to work." 
Vox Media and The Washington Post are the other publishers joining the ranks of publishers offering their own first-party data products. While these audiences are vast, varied, and global it unlikely that major advertisers will limit themselves to a single publisher. Advertisers will have to return to managing multiple direct relationships with these brands until ad networks find a way to add these products into their own platforms.

What does this mean for user privacy? 

People who pay to subscribe to The New York York times may not be delighted to hear that their emotional state is being packaged and sold to advertisers, but this does represent a slight step forward for user privacy. 

Rather than dragging all of this information around the web, attached to your identity like a billboard, you now become a nameless part of a data set, anonymized and aggregated. 

The publisher doesn't want to let the advertiser access your information. The publisher is responsible if there is a breach, or if they fail to adhere to regulations, so it's in their interest to protect your information. 

It also presents a clearer decision for the consumer. If you can live with one publisher accessing your data, you give consent via the CMP. At least this information will not be passed around everyone using the same ad network. A step forward for the user. 

One of many alternative solutions 

The return to a simpler first-party data offering will be a welcome product for advertisers and likely, a viable option for The New York Times to monetize. 

However, the scope of the project and the audience trust needed means that this is not an option for 99% of publishers. 

The blocking of third-party cookies will not be solved will a silver-bullet solution that satisfies advertisers and publishers alike. There will be a patchwork of solutions. Alternative trackers that give publishers the ability to advertise programmatically and multiple entry points for advertisers to reach publisher audiences.

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