In June, Jeff Green, CEO of the Trade Desk expressed his concerns, calling it a strategic mistake for Google to remove cookies. If you’re following this closely, you might’ve come across headlines like the Anti-Moonshot, Why Chrome’s Privacy Sandbox is a Failure of Vision. And it could lead you to the perception that Trade Desk is stepping away from Google’s privacy initiative. But as we’ll discover today, appearances can be deceiving. The Trade Desk has confirmed that they’re actively exploring integrations with several of their privacy sandbox APIs. What does this mean for the future of digital advertising? We’ll find out.

The Trade Desk is on a mission to really redefine display advertising’s role in its business and their efforts to roll out things like UID 2.0 and Independent Alternative ID has been closely watched by the entire industry. While the Trade Desk has emphasized the importance of alternatives to third-party cookies in targeting and measuring the success of ad campaigns on the open internet, how will they shape the industry future? Google’s also playing a significant role in shaping the future of user privacy within its web browser. They’re funding third-parties to conduct tests using Privacy Sandbox APIs. What implications does this have on the entire advertising ecosystem? A lot going on. So as we delve into these complex topics, one thing remains clear. The landscape of digital advertising is evolving rapidly and decisions made today will impact the future of marketing.

And then with that, I’m very excited to introduce today’s guest, Gabe Richman, the Senior Director of Global Identity and Platform Partnerships for the Trade Desk. Gabe, welcome aboard and thanks for being here with all of our listeners. If you don’t mind, share a snapshot of your background with our listeners.

Gace Richman:

Yeah, thank you so much for having me. Great to be here. As Dustin mentioned, Gabe Richmond, senior Director of Data Partnerships for the Trade Desk. For Trade Desk, I have the pleasure of overseeing kind of all things identity through the data partnerships lens. So I have responsibility for our proprietary cross device graphs and the partnerships that feed into that. I have responsibility for ID integrations, the IDs that we bid on and evaluating the ones that we may consider in the future. Of course, things like UID 2 and the European version, EUID are a big part of that initiative.

And then through the platform angle, I also get to collaborate with many of our clean room CDP and Warehouse partners in terms of building integrations that make it easy for advertisers to bring data to our platform and receive data from our platform as part of really owning their first party data strategy and their data and privacy future. I’ve been in this space for a little while. This is actually a bit of a homecoming for me because I really cut my teeth and identity back at LiveRamp when LiveRamp was part of the Acxiom family. And yeah, really great to be connecting with you all and bringing this full circle.

Kyle Hollaway:

Yeah, no, I love it. And Gabe, certainly we are very thrilled to have you here and talking about a very lightning rod kind of conversation. We’re excited to delve into this with you. Dustin, as you were talking, I was like, “Has Vegas weighed in on this yet? Is there a money line or an over under?” Something associated with are cookies going to deprecate or not. I feel like they could really get into that, so I don’t know. I may have to look into that.

Gace Richman:

The open internet versus Google.

Kyle Hollaway:

Yeah, exactly. But no, Gabe, seriously, thanks for being here. So let’s go ahead and just jump in and want to start with that top of mind topic. Talk about Google’s approach to the Privacy sandbox and the impacts that you anticipate from your perspective being a central function within the ecosystem.

Gace Richman:

Yeah, start off with some controversy. Let’s do it.

Kyle Hollaway:

There you go.

Gace Richman:

So obviously Google, we’re no longer starting to talk about cookies are going away or maybe we still are at the time of recording. We’ve seen 1% of cookies deprecate in Chrome, and so the rush really is on for advertisers and really the ecosystem at large to figure out their identity strategy and their strategy with regards to display targeting in the Chrome browser. So Google is pushing everyone into the sandbox this year. We’re definitely all still learning what that means for us. As you pointed out at the top of this podcast, there’s been a lot of ink spilled over this already. Right? I think the Trade Desk POV is fairly widely known. Certainly the trades like to glom onto that and maybe make it bigger than it is. We’re on record as saying that we don’t think that this is really for the better of the industry. We definitely see this as an opportunity for walled garden to put their walls up higher.

The most recent news, yes, the Trade Desk is open to testing the sandbox APIs for clients who want to partake, but fundamentally we believe that there’s a better way for the ecosystem at large to engage with consumers, and that’s mostly through authentication, which frameworks like UID 2 fully support. And I think authentication is actually a really important word here as you think about it in the context of Google and their strategy because between Chrome, Gmail, Google Single sign-on, they make it really easy and quite frankly valuable for consumers to remain logged in with Google across all of their different devices.

And so Google is maintaining users in an authenticated state where they’ve already not been very reliant on the third party cookies that they’re turning off for a lot of their ad serving. So why is it okay for them to target based on authentication, they say it’s not for the rest of the ad economy? But again, that said, we do plan to support advertisers who want to run their tests and let them come to their own conclusions.

Dustin Raney:

In our last episode we had Mattia Foci and he talked about consent and just this anonymity as it relates to maybe a mechanism that can function to actually provide consumers with more explicit consent meet GDPR, CCPA guidelines. In the US, you guys are leading the charge with UID as far as a consented proxy into the ecosystem. Do you think there’s going to need to be something layered on top of that to follow, to actually follow cross publisher across the open internet where they’re actually seeing who has access to my data even though maybe I consented to ESPN and I consented to Business Insider? How do you see that playing out just across the whole kind of Ad Tech economy.

Gace Richman:

That kind of really is the spirit of UID 2. Right? It’s an identity framework and infrastructure that does put choice and transparency and really control into the hands of the consumer. On our platform, we only see UID 2 in a bid request if the consumer has given permission to that publisher to turn their email into an advertising ID, and then that becomes a UID 2 which we might receive for bidding. So we are talking about an authenticated identity framework and infrastructure. We’ve already obviously seen the fallout of GDPR in Europe and having to deal with an opt-in ad economy and we’re doing okay there. Right? We haven’t seen things completely fall apart. If in the US things follow suit and we do have to have that extra layer of this becomes fully opt-in, I think we’re prepared for that and the technology and the tooling and the partnerships that we’ve landed to support this initiative and support this strategy will make it easy for that transition if and when that time comes.

Kyle Hollaway:

In your initial discussion, you talked about the walled gardens and deprecating the third party cookie, really an aspect of raising the walls higher and only giving minimal access through these privacy sandbox APIs and such. So in terms of UID 2, and was it primarily then going to be relegated to more of the open internet or do you see a strong opportunity to leverage UID 2s within walled gardens?

Gace Richman:

I’d say nothing is off the table. It’s really up to those parties if they wish to engage. If you think about the value of UID 2 as an advertising ID, when we’re talking walled garden, the utility would probably be more so for an advertiser in terms of their ability to send data to a walled garden or get data out of it and be able to do some sort of cross-channel, cross-platform reporting. Some of the clean room partnerships that have been established might actually be a really good way to use case to enable that and drive walled garden participation in the UID 2 initiative. But by nature of being a walled garden, you’re talking about an isolated environment. Would Facebook benefit from UID 2 within their own walls? Probably not. But they might benefit from it in terms of being able to accept a pseudonymous identifier as opposed to a raw email for their custom audience practice, as well as to send data out where it could be aggregated with other advertising data in a clean room environment or something to that effect.

Dustin Raney:

Yeah, no, that’s great. That makes a lot of sense right there. Okay, let’s go beyond even the walled gardens and social like connected TV. Typically the proxy and the IP address, things like that that are allowing you to drive personalized ads. Do you see UID and this kind of authenticating authenticating mechanisms driving into that direction as well? So we know Trade Desk, you guys play a lot in that space.

Gace Richman:

Yeah, connected TV, it’s really the next frontier of programmatic. We believe really strongly that the power is in programmatic and that we dollars we see shifting, the consumers are speaking with their wallets and cord cutting is becoming increasingly more common and you’re seeing this rise of ad supported streaming as a result. The IP question is a real one and it’s an important one, but it’s not just about CTV. I think if IP really went away, the entire ad industry would have to reconcile that and there would be challenges across the board. I can tell you within our walls we have been preparing for all scenarios. So the writing’s been on the wall for the third-party cookie. We have to expect that mobile ad IDs are not too far behind.

Google and Apple, Apple has already taken shots at the IP address with IP relay and there’s proposals in Google’s privacy sandbox to block our obfuscate IP address as well. So writing’s on the wall. All of the signal that we’ve been accustomed to using in a variety of ways and for a variety of use cases is at varying degrees and stages of risk. And in our identity platform and products on the Trade Desk, we’re a few years into this massive R&D effort to, future proof is an overused word, but let’s say become less reliant on that at risk signal so that if cookies are gone, we can still help advertisers meet their budgets. If IP address is gone, we can still build a graph and still facilitate programmatic advertising for buyers and sellers.

How are you guys thinking about that? You guys are so uniquely positioned as this sophisticated data business sitting inside a massive agency holding company, are these sorts of topics of interest to your clients and how are you guys talking to them about it?

Kyle Hollaway:

Yeah, no, absolutely. These topics are central to a lot of conversations and from two parts, certainly from an addressability standpoint, we deal directly with the first parties. We’re basically an agent of the first party in most cases. And in that case, how do you take that first party audience and then get it into the ecosystem or leverage it as a seed into a lookalike, which then becomes a third-party and then get it out there and actually be able to execute that with some transparency on your reach and everything. So what signals and what identifiers are being leveraged to do that, and are you able to maintain both precision, which first parties used to because they’re used to having that kind of direct signal and as well as the reach because they’re going out into the broader ecosystem

So how do you maintain that externally on the programmatic side, on the activation and then measurement is the next big equation. How do you actually measure, how do you get those signals back? Because again, walled gardens, they’re really closing off a lot of that external view of what’s happening within the walled garden, so making it even harder to see. And so, how do you map that back into the efficacy of your advertising on your own media direct engagement across multiple channels? Because consumers, they’ll see an advertisement, but then they may engage with you physically, depending if you’re a retailer or something like that. So how do you start to get that multi-touch attribution, mixed media modeling. All of that has an undercurrent of identity, like how you’re translating all of those signals back and forth. And that’s a huge question. And then one that we’re directly engaged with our direct clients on how to leverage not only Acxiom identity capabilities, but then associate those two things like UID 2 and leverage things in the market that are being positioned to help solve for those.

Dustin Raney:

Yeah, I think to layer on that, I really think that we do share some common values, Gabe, with Trade Desk and how we do things from an identity perspective. We believe that what’s a consumer engages with a brand, and that data then becomes first party data. As soon as I consented with the brand, I want to have a meaningful experience with that brand, which means identity then becomes key in driving continuity through the journey, how you engage with me, what’s relevant to me. So layering on using third party data, third party cookies going away doesn’t mean third party data is going away. So the ability to augment identity to drive a higher level of fidelity and connectivity, I think is our viewpoint. Similar to you guys with your graph extension, your ability to go beyond what the brand has just in and of themselves. So Gabe, we’ve talked about then authenticated traffic being the future, that authenticated piece.

What do you see going forward, the consumer experience being like in the open internet, it’s one thing within the walled gardens, right? Yeah. You log into Facebook or you log into Google across your device and your browser such. What about the open internet? What’s that going to look like?

Gace Richman:

I think it has to look a little bit different. And so, we think that authentication is not just a publisher problem in terms of their ability to maintain ad revenues. It’s also an advertiser problem. Advertisers, as part of their first-party data strategy need to be thinking about their website and how they get consumers who visit their landing pages to raise their hand and self-identify and say, “Yep, this is [email protected] and I’m interested in this Lexus.” Or something like that. It has to look a little bit different. Website owners, publishers, advertisers will need to figure out how to invite consumers to self-identify and earn that identification in a way that is not creepy or invasive or worst case scenario truly for them leads to high rates of abandonment.

The concept of SSO, single sign-on, is nothing new. Trade Desk, we are out in market with our open pass single sign-on. If you guys were at CES, you may have seen some of the billboards promoting it. We had a big activation out there earlier this month. But it’s one thing to allow consumers to authenticate on your website. It’s another thing to encourage them and really earn that authentication, earn that identification from them. And for publishers, they’ll need to figure out how to effectively gate content in a way where they can earn that authentication without high rates of abandonment. And there will be a trade-off there. Right? People will leave the page, but are the ad revenues they can capture from an authenticated user tied to a durable ID, UID 2 or similar? Does that outweigh the downside of those who abandon and that you can’t serve an addressable ad two because you don’t really have a strong identity for them.

But yeah, I think things will change. They have to change and honestly, that’s probably the biggest risk as we work our way through 2024 for both advertisers and publishers. They really need to be thinking about the authentication, the identification experience for consumers visiting their websites.

Kyle Hollaway:

While we’ve been talking and have had a few “controversial” questions here, do you think about the consumer much in regards to what their receptivity to all of this is going to be? In the terms of, say everybody got it in the industry, publishers and advertisers got it, and they’re like, “Yep, got to put up some kind of sign in wall. Maybe it’s pay, maybe it’s free, whatever. Get that authentication upfront with consent associated with that.” And suddenly everywhere you go on the internet is that. Do you think consumers are actually going to accept that? Do you think there’s going to be pushback from consumers?

Gace Richman:

I think it really depends on if it’s done well and tastefully, can you give a consumer one or two articles for free and then pop up an email capture or single sign-on popups to access the rest of the content on their website. Right? There are certainly ways to do it that don’t make it so that the authentication experience is just like the next evolution of the cookie banner popups, which frankly, I’m sure I speak for the majority of web users, can’t click those off of the page fast enough. I’m certainly not reading all of the copy and going through all the ad choices. And working in AdTech, that’s probably not music to a lot of folks ears, but it of course is the reality and you got to expect that the majority of consumers are not reading through that in detail. So if you’ve got one shot to put an email capture or a sign-in button in front of a consumer, when are you going to do that?

How are you going to present the value exchange to them in a way where they understand what they’re giving up and what they’re getting back in return? And how do you do that in a way where it doesn’t fully disrupt their experience and have them abandon the website? Yes, we certainly do think of the consumer experience and the consumer opinion, but it can’t be any worse than the state of cookie popups today.

Kyle Hollaway:

Yeah, I mean personally, I just feel like there’s a question there that we haven’t really talked about in a lot of space, at least I haven’t seen much discussion is on fraud in the sense of consumer identity. I know the websites I go to that I really want to engage with, they’re most likely known entities to me, that I’m going to be willing to share my credentials with my email address or something. And in doing so, I’m engaging on that level as that proliferates and there’s a need to do that somewhat frictionlessly on all websites. Then it becomes either like the cookie banner, I become very immune to it.

I just am throwing my email to anybody and everybody or really having to think more and there’s more friction in the deal. And as bad actors putting up websites, you already get them for just click bait and whatnot, but capturing those signals just seems like it could create environment of some identity theft that could be going on as part of that. It’s just an interesting, with everything, there’s two sides to a coin, right? There’s some real benefits and then there’s also these things of, wow, there’s a side effect potentially that could be detrimental.

Gace Richman:

Yeah, that’s an interesting thought.

Kyle Hollaway:

Yeah. With UID 2, because it’s largely an email based function that’s a representation of that. What are you guys doing in terms of the authentication and the validity of those emails? Or do you view the email simply as a signal and if it’s been presented, it is because there is that aspect, right? Even a bad signal is a signal and therefore it’s usable. How are you guys addressing that?

Gace Richman:

Quite frankly, there’s nothing in the UID 2 technology that’s validating the quality or accuracy or reliability of an email. UID 2 is quite simply a set of APIs. You hit it with a raw or hashed email and you get back a UID 2 if you’re an advertiser or a data provider, or a encrypted token if you are a publisher, there’s nothing natively in the UID 2 technology that’s sort of protecting in the way that you’re describing. But we would hope, if not expect, that for publishers who are collecting emails on their websites that they have some mechanism to validate whether it’s a real email, maybe they’re sending out a double opt-in, click to confirm sort of thing.

Or there’s even this new class of technologies where you can call an API with an email address in real time is being entered and have them validate whether it’s a real email or machine generated email. And if it is, they’ll return that and you produce some copy like, “Oops, looks like you gave a bad email. Can you give us a real one so we can serve you relevant advertising?” Or something like that. So yeah, I think it’s a really interesting time. All of this complexity really breeds innovation, and I think there’s going to be a lot of interesting startups that come to light and gain traction that are both helping to present the value exchange to the consumer in an effective way and validate the validity of the email or information that the consumer is providing to publishers or advertisers as part of this new ad economy.

Dustin Raney:

And speaking of innovation, probably a good time to talk a little bit about AI, right? I think it’s exactly what we’re talking about is maybe a great use case for an AI application to start to learn behaviors. I think we’re right in the middle of the AI hype cycle. Gabe, is Trade Desk, I’m assuming in your backroom office, you guys are researching leveraging AI in new unique ways. How do you see that playing out this year and the years to come?

Gace Richman:

No doubt it’s the buzzword of the year 2023, maybe it will be again in 2024. AI is nothing new for us. We first release our COA AI back in 2018, and we think of COA really as the advertiser’s copilot. So you come in, you set up a campaign, you input your goals and bring your audience data forward. You create your plan once that goes live, the AI is what’s riding alongside your campaign, making real time optimizations as your programmatic co-pilot, helping you to optimize, execute, and achieve your goals. Again, nothing new for us. We’ve been out in market with that. We have continued to iterate on that. We will continue to iterate on that. We’re certainly thinking about new ways to apply similar concepts. Can we point COA at our graph and use it to make connections between things IDs and things without IDs, things of that nature? Yeah. Again, nothing new here, but what about you guys? How are you starting to use AI within your walls, if you are?

Dustin Raney:

Yeah, I think the way I like to describe it, at least from a philosophical perspective, maybe. It’s just another tool and it is like fire and you can either heat yourself or burn the house down depending on how you use it. And Acxiom kind of being a data company, AI needs data and the data needs to be right, and then what holds data together? Identity, but we happen to have expertise there as well. Our goal I think right now strategically is just to ensure that existing AI technology has the right perspective of the customer with the right data associated with this relevant. And then, like you, testing into the new capabilities specifically around identity, how you bring signals and touch points together. Kyle, what would you say?

Kyle Hollaway:

Yeah, largely those things. Certainly Acxiom is a data and identity company, right? We’re definitely leaning in heavy on the data side and have use various forms of AI, means a lot of things, right? Everything from machine learning to other things. But even approaching into the generative AI component of being able to leverage our third party data to leveraging generative AI to extract an audience, being able to use more natural language type descriptions of an audience and pull that out versus going down the seed route to generate a lookalike.

There’s alternatives which is, Hey, just here’s a description of my audience. Can you pull that? So we’re leaning into those types of applications as well within AI identity itself. On the digital side, I think it’s more applicable because the signals are a little more consistent in a way, a signal looks, and then trying to look at patterns and things such of that versus on our traditional side with names and addresses and everything. You well know having been in this space a long time, people could come up with some crazy names and it’s hard to predict that, and it’s hard to, for AI to know, oh, is that new signal? Is that a legit name? But very well could be. Somebody may have decided to go with Orangelo this time instead of orange Jello or whatever. And so, I haven’t really seen AI, specifically on the more generative side, really solve for that yet on how to make those kind of non-intuitive linkages of data and understand the nuances of dynamic human behavior on names.

But I think it’s going to start to get there. I think as the large language models mature and more and more signals are fed in, we’ll be surprised at what it can intuit and what it can not intuit. I’m anxious to see how it plays out.

Dustin Raney:

So Gabe, I’m a CMO of any Fortune 100 company, I’ve got a dollar to spend to drive growth. Why am I spending it with the Trade Desk over anything else?

Gace Richman:

Wow, what a good question. Trade Desk, we represent the buy side. Everything that we do is for the advertiser or their agency. We have been way out in front of the identity conversation, have been for some time. We have extreme confidence in our platform, our products, and our ability to help advertisers meet and achieve, really exceed their objectives and drive business outcomes. We are the largest global independent DSP servicing the buy side. We don’t think about single channel activation. We think about omnichannel activation and how can we make that dollar go … A dollar on CTV might not go that far, but how can we help that advertiser talk to their ideal customers across all the different screens, touch points, devices, and channels where they’re consuming media. Targeting within the browser environment might be changing, but that’s a small sliver of all the different places that consumer attention has gone to.

And we’ve established relationships and integrations and opportunities to purchase high value premium inventory across CTV and streaming audio and you name it. Right? So we talk about identity, we talk about activating on the trade desk. We’re not just talking about what’s happening within any one browser or any one environment. We’re talking about it holistically and how we can help advertisers talk to and activate against and frequency cap and measure the people that they wish to reach and not just a set of devices.

Kyle Hollaway:

Man, great answer. As anticipated time has flown by, and so we’re already coming up on the end. I know there’s a lot more we could talk about. And Gabe, I’ll go ahead and preemptively say, hey, we’re going to have you back at some point. Let’s see how some of this plays out through ’24 and would love to connect maybe in the fall or something and see how things are progressing if we were seeing Google continue to move forward with the deprecation. And I’m also really interested in how you guys are seeing that play into, I know 1%, it’s really hard to maybe see it because that’s such a nominal volume, but as that potentially increases, would love to see your take on that and are you guys seeing specific impact to that.

So with that, we always have a wrap up question. You’ve probably already touched on some of these topics that come to mind for you, but what has you the most excited about the next 12 months?

Gace Richman:

From a macro level, I might’ve mentioned this earlier on, I am very much looking forward to not having to talk about cookies going away and look forward to a time where we can talk about cookies are gone and where are we now. Outside of our platform. I think that it’ll be a really interesting time to see some of the M&A continue to unfold. We’ve already seen consolidation in the clean room category with Snowflake taking on Samooha. LiveRamp recently acquired Habu. I think there’s a few key players still on the market, and I can’t only imagine the competition going on behind closed doors to bring those into certain companies environments and stacks. As far as my role and where I sit within Trade Desk and in the identity ecosystem, I’m excited to continue collaborating with participants on their identity journeys. And that includes even companies that you’d likely consider to be competitors to the Trade Desk. Right?

UID 2 is not just a trade desk offering, but we also partner with a number of other DSPs, and that’s one of the most fun parts of my job, getting to work with companies who you would assume and we do otherwise compete with, but we can bury the hatchet and recognize that this is a rising tide lifts all boats situation and collaboration here is way better than competition. Yeah, we’ve been preparing for this moment for some time and just really excited for what the future holds.

Kyle Hollaway:

Yeah, I love that. I do love how sometimes these types of seismic events do bring people together, even though you are competitors or in a competitive space that brings us together to say, Hey, let’s solve this together and move forward. So that’s really cool. So hopefully we’ll see a lot of that play out and certainly are interested in what is happening in some of that consolidations as well. So thank you, Gabe, for joining us. Super insightful and loved a lot of your perspective at the Trade Desk. I’m excited to see you guys continue to grow and we will be interested to really see how this authenticated future plays out.

Gace Richman:

Kyle, Dustin, thank you so much for having me.

Kyle Hollaway:

And for our listeners, you can find all of our Real Identity podcast episodes at acxiom.com/realtalk, or you can find us on your favorite podcast platform. Look forward to talking to all of you next time. Thank you.