Data has been integral to programmatic advertising’s ability to identify target audiences for years. However, the industry has long relied on syncing cookies to achieve this. The absence of a standardized solution across platforms, including mobile apps and connected TVs, has led to data loss. But how?
In the ad tech industry, partners sync third-party cookies to identify users, slowing down page loads and negatively affecting user experience, ultimately reducing match rates. Universal IDs offer a shared identifier that eliminates cookie syncing and traces users seamlessly across the supply chain.
Numerous ad tech companies have developed ID solutions to address cookie-syncing challenges like data loss and user duplication while identifying users across all channels. These solutions enable relevant ad serving through universal IDs to enhance user experiences.
One such company is The Trade Desk, one of the largest demand-side platforms (DSPs), which created a proprietary identifier called Unified ID 2.0.
In this article, we will dive deeper into what Unified ID 2.0 is, its future advances, and how useful they are. But before jumping into it, let us understand what happened to Unified ID 1.0.
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What Is Unified ID 1.0?
In 2019, The Trade Desk launched the Unified ID 1.0, a solution designed to eliminate cookie-syncing and facilitate efficient audience identification for buyers and sellers. This unique for open web users could be shared across the ecosystem to improve collaboration between players in the industry.
UID 1.0 provided a universal solution for identifying users and trading ad impressions across platforms, eliminating the need for creating platform-specific cookie-based user IDs and subsequent syncing. This solution was accessible to various players, including DSPs, SSPs, and DMPs.
As the largest independent demand-side platform (DSP), we have one of the most ubiquitous cookie footprints in the world.”
With Unified ID, publishers were able to reduce the loss of user data and grow the match rates (because there’s no cookie syncing).
The Trade Desk reported impressive cookie match rates of 99% since the launch of its initial solution. However, the solution was short-lived as it relied on third-party cookies. As a result, the company introduced a more advanced version of the solution, Unified ID 2.0, to provide a more reliable and effective alternative.
So, What Is Unified 2.0?
Unified ID 2.0 (UID2) is an alphanumeric identifier that prioritizes user privacy by remaining unencrypted. It is generated using either the user’s email address.
The industry-wide initiative of Unified ID 2.0 strives to enhance consumer privacy and control while retaining the capacity to run personalized and targeted ads without relying on cookies. All parties involved in the Supply Chain can utilize this open-source solution. According to Dave Pickles, Co-founder of The Trade Desk,
“UID 2.0 provides an opportunity to have conversations with consumers and provide them with the sort of transparency we as an industry have been trying to provide for a long time,”
How Does It Work?
Unified ID 2.0 is anticipated to serve as a single sign-on solution that enables users to log in* to various websites with a single click, provided that the websites are compatible with and integrate with UID 2.0’s SSO solution. This feature will provide users convenient and uninterrupted access to multiple websites and mobile applications using just one login credential. With this single sign-on capability, users will no longer have to manage separate login credentials for different websites and publishers.
*If the users are new, they must sign up using their email addresses first.
This will also make identifying users easier across all the channels — desktop, mobile, and CTVs.
Let’s understand Unified ID 2.0 better with an example:
- Collect user data: The visitor logs in to the publisher’s website and consents to collect the data to create the UID 2.0.
- Encrypt data: The publisher sends the email address to UID 2 Operator for token generation. The token generation service provider sends the UID 2 Token (an encrypted version of raw UID 2) to the publisher.
- Share data: The publisher collects and shares the UID 2 Token with the Client-side Identity SDK (provided by The Trade Desk) and the SSPs to store it in their web store and pass it to DSPs, respectively.
- Match data: DSPs that receive the UID 2 Token in a bid request decrypt and match it with the data in their database to return a relevant ad to the SSPs.
At the point of login, the user can see why the publisher wants to create this identifier and how their personal information is used on the open internet. They also get to set and control how their data is shared.
Features of Unified ID 2.0
While developing UID 2.0, The Trade Desk mainly focused on features that would continuously support publishers to deliver relevant content efficiently to consumers. Here are four key features of Unified ID 2.0:
- Open source: The Unified ID 2.0 framework is non-commercial, open-source, and free of charge. Email addresses are encrypted and hashed to prevent fraud to ensure user data security. The solution is supported by Prebid’s involvement, which handles the infrastructure, encryption, and decryption processes. Additionally, the solution’s open-source nature ensures transparency and accountability for its users.
- Single Sign-On (SSO): Unified ID 2.0 is a free and independent single sign-on solution that functions seamlessly across the open internet. Criteo, an early adopter of Unified ID 2.0, began testing the user-facing component known as “OpenPass.” Publishers can use OpenPass to collect user email addresses and consent, creating user IDs that can be leveraged for targeted advertising. This feature is a valuable tool for publishers seeking to enhance their targeting capabilities while respecting user privacy and consent.
- Framework for publishers: A clear, easy, and simple user interface that not only explains the exchange of data on the internet but also builds trust with your users.
- User transparency and privacy controls: Consumers can view and manage their preferences and opt out anytime.
Benefits of Unified ID 2.0
One of the critical factors in the success of Unified ID 2.0 is its adoption by publishers. By implementing this solution, publishers can reap the benefits of higher CPMs for their ad inventories through more targeted and relevant advertising. This underscores the value of Unified ID 2.0 for publishers seeking to optimize their ad revenue while delivering more personalized ad experiences to their audiences.
- Anonymization: UID 2.0 is a unique string of alphanumeric characters that cannot be used to derive a user’s email address or any other identifiable information. This ensures that users can maintain their privacy while benefiting from the personalized advertising experiences enabled by UID 2.0.
- Greater control and privacy for users: Unified ID 2.0 empowers users with greater online control over their personal information, leading to enhanced privacy. Through this solution, users can dictate how their data is utilized, mitigating concerns over unauthorized access or misuse of their personal information. By providing this level of transparency and control, UID 2.0 supports users in safeguarding their privacy while enabling them to benefit from personalized online experiences.
- Better interoperability: Interoperability plays a pivotal role in streamlining operations and reducing expenses for all players in the ad tech industry, ultimately resulting in increased digital ad revenue. By enabling seamless data sharing and eliminating the need for cookie-syncing, interoperability minimizes friction and enhances efficiency across the ecosystem. This enhances the scalability of ad tech operations, driving growth and profitability for businesses of all sizes.
The Growing Significance of UID 2.0 in a Post-Cookie World
In conclusion, Unified ID 2.0 is an innovative, privacy-focused solution that could transform how publishers and advertisers collect and utilize data. With the end of third-party cookies looming on the horizon, Unified ID 2.0 offers a standardized and secure approach that preserves user anonymity while still facilitating personalized content delivery.
While there are still obstacles to overcome in adoption and implementation, the potential benefits of Unified ID 2.0 are substantial, making it an increasingly essential component of the digital advertising landscape.
As the industry continues to evolve, Unified ID 2.0 is poised to play a significant role in shaping the future of personalized advertising, ensuring that users’ privacy is protected while enabling publishers and advertisers to provide targeted content to the right audiences.
FAQs
What Is a Unified ID?
A Unified ID is an identification system intended to be utilized across various systems or platforms. Its primary objective is to create an identifier that can be employed to recognize users across various websites and mobile applications.
How Does Unified ID Work?
Unified 2.0 uses an encrypted and hashed email-based ID to track users and show them ads that are more relevant to their interests. It is made up of a bunch of random letters and numbers that are created based on the user’s email address.
