A Conversation on Unified ID 2.0 and Cookies with Bill Michels of The Trade Desk

In recent years, data privacy and security concerns have gone mainstream

In late 2019, the EU mandated that users must actively consent to all cookies when they use a website, or the site can’t gather any of their data. In 2020, millions of folks began working from home, taking their cybersecurity up a notch and thinking twice about clicking “accept cookies.”

What does this mean for those of us who use cookies to find the right targets for ads?

“Advertising is ultimately a trillion-dollar market,” says Bill Michels, General Manager of Product at global media buying platform The Trade Desk. “There’s not many of those in the world. And that brings with it lots of room for growth and for solving problems to help customers.”

Unified ID 2.0 is a new approach that’s both an upgrade and an alternative to third-party cookies. It allows advertisers to deploy ads that are relevant to individual users, but gives those users increased control and privacy.

Bill is one of the key people making UID 2.0 happen. His work over the past few years has been concerned with data — how it’s shared, who can access it and what they’re able to do with it.

He wants to build “the right products and tools so developers, brands and other folks that play inside the data ecosystem can get the right access to data to make important decisions –– and also build the best products they can build.”

Working on the UID 2.0 project has been a rewarding journey, he says.

“It’s one of the few things I’ve seen in my career in which the level of industry collaboration has been very exciting and promising.”

On an episode of Identity Revolution, Bill talks about how the UID 2.0 works, why it’s the next best step forward and what it means for the industry.

Global economy, omnichannel approach

With revenues of more than $800 million annually, a $39 billion market cap and more than 1,500 employees on four continents, The Trade Desk is an undisputed power player in the industry.

But if it’s not a household name to you, Bill explains what the company does: “Agencies and brands leverage our software to purchase media across the entire open internet. We describe the internet as ‘basically everything outside of a walled garden.’ ”

That means anywhere people consume media, including display ads that show up in your browser or mobile app, audio ads on streaming radio and podcasts, and commercials on streaming TV.

The Trade Desk takes an omnichannel strategy that enables marketers to explore every kind of media, market and country, Bill says.

“We are very much a global company that happens to be headquartered in the U.S. Everything we do is definitely approached with a global mindset.”

And the company continues to grow, especially as it rolls out the Unified ID 2.0 project.

The next best Universal ID

To explain the second iteration of this technology, it’s helpful to understand Unified ID 1.0, which The Trade Desk announced in 2018.

“It’s what we call a cookie sync,” Bill explains. “It helps different parties sync third-party cookies to help reduce the load of websites. And offline syncing helps us understand the identity of who’s on that browser page.”

But third-party cookies are being phased out faster than chocolate-chip cookies disappear from a jar. Google Chrome, which accounts for more than half of global web traffic, says it will no longer support them by 2022.

What will that mean for marketers –– and the rest of us?

“On a given webpage, a third party will no longer be able to track and have a sense of who you are based on a piece of code they put on there,” Bill says. “Unified ID is an industry solution. We want the ability for consumers to be able to log in to a website to authenticate who they are.”

This will enable publishers to offer “a value exchange,” he adds.

“They can explain to a user why identity is important and how they’ll treat it in a safe and transparent way. It also allows them to offer content and services for free.”

As UID 2.0 becomes more pervasive, “we’ll see more and more impressions, or advertising opportunities, on the open internet that have a logged-in component to them.”

The Trade Desk architected a system that “allows folks to share who they are” without exposing their actual email address. That way, when those users’ identity goes through SSPs in the open marketplace, it’s secure.

Plus, the Unified ID 2.0 technology is “very lightweight,” Bill adds. “It can be operated without a lot of costs and doesn’t require a single central service with a lot of servers to manage or need a lot of software around it to protect it.”

Open source opens up possibilities

The Trade Desk began sharing its UID 2.0 designs in summer 2020 and solicited feedback from across the industry.

“It’s exciting to see people give good, honest feedback,” he says. “We can be flexible and incorporate it.”

Now, the UID 2.0 tech is live and gaining steam.

“We’re able to generate UID2s now for some participants in a POC [proof-of-concept] phase,” says Bill. “Brands are generating UID2s. A few publishers have integrated them. We see them into the bitstream … We’ll be scaling that out more and more.”

He’s also pleased to see other DSPs [demand-side platforms] begin scaling their adoption of UID 2.0.

“They get it,” he says. “They’re excited to adopt it as well.”

Right now, The Trade Desk is operating and hosting the program, but eventually, UID 2.0 will be a completely open source application.

“The code base itself will be managed in an open source framework,” he explains. “So others will be able to get access and transparency into the code to ensure that it’s doing what we say it’s doing –– and to suggest adjustments to the system.”

The future looks bright for adtech

In an industry that seems to experience paradigm shifts every few years, Bill is a long-hauler.

Prior to The Trade Desk, Bill spent more than 10 years at Factual (which acquired Foursquare) and, before that, 5-plus years at Yahoo! He’s seen his share of ups and downs, but he’s bullish on martech and adtech overall.

So what does the future hold?

“We’ve seen a great run over the past three to six months in equity evaluations of marketing and advertising technology companies,” he says. “That’s fantastic. It’s a nice validation that these businesses can run at great margins with really nice growth rates. And they can build sustainable moats around their products that help reiterate and protect that growth.”

But there’s still plenty of room for innovation and work to do, Bill adds.

“It’s a promising space with a lot of growth … The job is never done. There will be more and more companies applying smart technologies to solve problems for customers.”

Contact us to see how Infutor can help drive your own MarTech initiatives.

Note: This is based on an episode of Identity Revolution, Infutor’s podcast featuring data-driven experts discussing all things marketing, analytics and identity.