As announced, Google disabled third-party cookies for 1% of its Chrome users and will disable them for the remaining Chrome users by the end of this year. Without third-party cookies, tracking and targeting users online is very difficult.
As discussed in our previous article, leading providers suggest many alternatives for cookieless advertising. For example, Google proposes many alternatives under its privacy sandbox initiative. Likely, the trade desk proposes “UID 2.0” or “Unified ID 2.0” for cookieless advertising.
In this article, I have shared most of the information regarding UID 2.0. So, you can easily understand how the trade desk UID2.0 works, how the UID 2.0 differs from the FLoC (Privacy Sandbox Initiative), and more.
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What do no cookies mean for marketing?
Using cookies, we can identify and target users online. Two types of cookies are available now. One is first-party cookies that are used by publishers or website owners help to save user preferences, login information, etc. The second one is, third-party cookies mostly used for online advertising to show personalized ads by tracking a user’s browsing history and activities.
Due to privacy concerns, the majority of browsers have decided to stop supporting third-party cookies. Mozilla Firefox stopped supporting the third-party cookies completely. The major browser, Google Chrome, disabled third-party cookies for 1% of its users and decided to disable it for all users by the end of this year.
All browsers still support first-party cookies and they only stop supporting the third-party cookies.
Online advertising will become more complex without third party cookies. So, companies that are mostly dependent on online advertising will be affected by the cookieless world.
Online advertising has been considered the most valuable advertising medium in recent years. Without third-party cookies, it will face huge consequences until it finds an alternative.
What is UID 2.0?
The trade desk proposed UID 2.0 as an alternative to cookieless advertising. It’s an open-source framework that relies on hashed email or phone numbers.
By relaying a hashed email or phone number, it hides the user’s personal information and complies with privacy regulation policies like GDPR and CCPA.
How does the UID 2.0 work?
UID 2.0 is one of the recommended alternative solutions for cookieless advertising. So, understanding the workflow of UID 2.0 is very helpful in deciding the right tool for your business. Here, I have explained the process of UID 2.0 practically.
Publishers or retailers can participate in UID 2.0 by integrating with the Trade Desk’s Identity Link Service.
Also, users can opt-in to UID 2.0 by providing their consent. The consent is to share the email ID or phone number with the Trade Desk’s Identity Link Service. If the user opts out, their email ID or phone number isn’t shared with this service.
When the opt-in user visits the participating publisher sites, the email id or phone number of a particular user is shared with the UID 2.0 service. For each user, a unique, anonymized UID 2.0 token will be created using hashing and salting techniques.
Note: At any time, users can opt out of this service.
The generated UID 2.0 token is stored in a central database managed by prebid.org. prebid.org is a dependent non-profit organization. So, no one gets additional benefits from here.
The publishers or ad platforms like DSP can access the tokens, not the email addresses or phone numbers.
How does UID 2.0 work in real time?
Many industrial experts also struggle to understand the workflow of UID 2.0, the trade desk solution for cookieless advertising. Here is the real-time workflow example for UID 2.0.
- User A visits the website xyz.com and this website participates in the UID 2.0 program.
- The website motivates user A to provide an email ID or mobile number. For example: give additional information, offers, etc.
- Once user A gives the email ID or mobile number, these details are sent to the UID 2.0 operator.
- The UID operator returns the UID 2 token to the website, and the website stores the UID 2 token in the client side SDK.
- When the same user loads a website that has an ad slot, it sends the ad request along with the UID 2 token to SSP.
- SSP sends the ad request along with the UID 2 token to DSP.
- DSP sends the UID 2 token to the RTB SDK and gets the decoded UID 2 of user A.
- DSP identifies the user A’s UID present in the targeted segment “lifestyle”
- The DSP sends the bid response for lifestyle ads to the corresponding SSP.
- SSP sends the bid response to the website.
- A lifestyle ad is displayed to user A.
- That is how user A is identified under the UID 2.0 system and displays personalized advertisements online.
Difference Between UID 2.0 vs FLoC
Both models are alternative suggestions for cookieless advertising. But, both have unique differences. Here, I have explained the unique differences between them.
| UID 2.0 | FLoC |
It uses hashed email or phone numbers as tokens to identify the users online. | It groups users with similar interests based on their recent browsing history. |
| Even though hashing the email address or phone number, individual targeting is possible here. | User-level data is not tracked here. So, individual targeting is not possible here. |
| Neither publishers nor ad platforms know the exact email ID or phone number; they can only access tokens. That’s how the user’s privacy is secured here. Also, users can opt out of this model. | This is focused on group-based targeting. So, individual targeting risk is low here. |
UID 2.0 works across all platforms and browsers. So, the reach is high. | As of now, FLoc is limited to the Chrome and Google ecosystems. So the reach is limited. |
Conclusion
Everyone in the digital advertising industry eagerly looks for a solid alternative to cookieless advertising. But it’s not quite easy in the privacy-conscious digital world. Many proposals are available for cookieless advertising, but none are widely accepted.
In this article, you learned about UID 2.0 and how it works in real-time. The difference between FLoC vs UID 2.0 will help you choose the most suitable solution for your business in the future. We will discuss more alternatives in the upcoming articles. So, keep following our website.
The digital advertising industry should find a solution before the end of this year, as Chrome will disable third-party cookies for all users.
The success of any alternative purely depends on the acceptance of major market players.
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