MarTech Series – Marketing Technology Insights
Marketers are increasing their focus on first-party ID-based targeting and measurement for good reason. Not only has Apple limited the use of third party cookies and IDs on their devices and browsers, Google has announced that they are close to doing the same thing, and are testing alternatives in their Privacy Sandbox.
In a recent report by Advertiser Perceptions, 58% of advertisers reported that they were growing their first-party data collection capabilities, and 85% were talking to their ad tech and marketing partners to address the issue. Three of the most popular data points that marketers are using to support targeting and measurement in the future are hashed email addresses, mobile IDs and IP addresses. While first party data has been hailed as more stable and more accurate than third party cookies, not every data point is created equal.
MediaWallah recently published research that looks at the relative stability and uniqueness of these three major identifiers being collected for use in digital advertising and marketing to see how they are changing, how they compare, and what brands need to know as they further their first party data efforts.
One of the benefits of first party data is that it can be much more persistent than third party cookies. While a cookie can easily be deleted, an email address or IP address lasts for a much longer time. Many people have email addresses for years, if not decades, and it is a highly reliable ID point to reconcile across devices.
However, our research found that mobile IDs are not as persistent as the other two types of IDs and are actually decreasing in persistence over time. While a mobile ID used to be nearly two years old on average, that number went down to a lifespan of only six months in our study of 2021 data, a decrease of about 3x. Brands should keep track of the relative persistence of the IDs they collect in order to inform their need to refresh data and reconcile it with a third party that can help fill in gaps.
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While hashed emails are the foundation of many first party databases, they are not perfect. Because there is more than one way to hash an email (including MD5, SHA1 and SHA256), a lot of the work of matching emails sets involves aligning across different hash types. But matching across the hash types can cause problems. On average, we found that six percent of hashed email data collected of a single hash type contain mismatched hashes of different hash types.. Across millions of emails, this can create challenges when trying to use HEMs as a scalable anchor for linkages..
Rather than simply throw mismatches away, brands should analyze the mismatches. There could be an error with formatting or spelling, or a field that has been changed. Every email address represents a potential revenue opportunity, and each one should be treated accordingly.
This mismatching issue doesn’t occur with mobile ids and IP addresses, however, any two data sets that are compared should always be analyzed to ensure that no formatting issues or other errors are creating problems that can eat into scale and targeting.
While most people have personal mobile phones and email addresses, IP addresses are another story. Often called “household-level IDs” these multi-use IP addresses are not valuable for individual targeting, since many people use them at once. But they can be a highly effective key to reconciling individuals to household level data such as address and targeting for CTV.
However, IP address needs to be reconciled with other data to ascertain if it should be associated with a household or an individual. What’s more, we found that about 18 percent of IP addresses are not based in a home, and are likely used by a much higher number of individuals, at an office or coffee shop, for example. These “overconnected” identifiers are not useful for targeting unless it’s at a very general location level.
The use of these and other identifiers to create an alternative to third-party cookie advertising is reaching a major tipping point. Not only are brands experimenting with their own data, they are creating relationships with vendors to connect their data to third parties through data clean rooms and ID graphs. While third party cookies are still available in several parts of the internet, including on Google Chrome, the timeline for third party cookies is limited. Now is the time for advertisers, publishers and technology companies to learn as much as they can about the various identifiers being used in order to build a viable foundation for the future of digital advertising. Ultimately, the better we understand how these IDs function, the more accurate our ultimate approach will be.
By Bobby Atefi, Chief Data Scientist, MediaWallah
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Bobby Atefi, is the Chief Data Scientist at MediaWallah
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MarTech Series – Marketing Technology Insights