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Openings for ad tech in a post-cookie world

Retail media is the great opportunity of the year – and maybe of the decade

Expect to see marketplaces running ads on their sites now, and for ad-tech that’s an open goal. 
photograph: getty images

Expect to see marketplaces running ads on their sites now, and for ad-tech that’s an open goal. Photograph: Getty Images

 

This week on the podcast I welcomed an Inside Marketing favourite back to the show: the wonderfully candid and deceptively smart Ciarán O’Kane, chief executive of WireCorp. Advertising (and ad tech) is too often an industry drunk on its own hype, often full of misguided experts with an unshakeable sense of self-belief, so it’s a breath of fresh air to speak to someone who is comfortable enough to just say it like it is. 


In this week's episode of Inside Marketing podcast, Ciaran O'Kane, CEO of WireCorp, is back with us to talk all things ad tech. Listen now:


While it’s generally wise to curb your public comments, it is refreshing to hear someone who genuinely doesn’t worry about what others think. O’Kane will be the first to admit that he shoots from the hip and that, on occasion, a moment’s pause may be the shrewd move, but he’s the type of person who will tell you what he thinks, regardless of whether the collateral damage causes some upset. 

Advertising is a game where smooth talk can trump sensibility, so for O’Kane to have built such a successful business in the cut-throat advertising mecca of London is no mean feat. Mark Ritson says the Irish have an innate ability to downplay our intellect in a bid to disarm our counterparts in business, and speaking to O’Kane I know what he meant. He has a disarming charm and honesty coupled with razor-sharp wit and intellect, but he’s firmly grounded and unpretentious. 

We started talking about whether Google will leave the ad tech business. “I still think they will because the noose around their neck is tightening, there are so many anti-competitive cases against them in the US and Europe around practices they’ve engaged in over the last few years,” O’Kane says. 

WireCorp chief executive Ciarán O’Kane: ‘To me the metaverse is a nonsensical term – gaming has been doing this for years’
WireCorp chief executive Ciarán O’Kane: ‘To me the metaverse is a nonsensical term – gaming has been doing this for years’

“I think they will spin off parts of their business to get away from the legislators’ glare and the most logical way is to offer third-party ad tech as an appeasement because they’re doing so well in search and YouTube that they don’t want to risk losing any of these things by force. Arguably this sacrifice would lessen the heat on them and allow them to get ahead of the action that’s going through the courts now: making a deal helps keep legislators onside.” 

Third-party cookies were supposed to be phased out by this month, but Google announced a stay of execution and so the industry continues to live in denial. 

I welcome a cookie-less marketing world, so I asked him why we don’t just get on with it. “What’s happening now is that our legacy ad tech industry is desperately trying to maintain the status quo because there are too many companies making too much money and too invested in the cookie, so to re-architect this new world would put a lot of them out of business.”

O’Kane adds this new world order would be good for some. “A lot of publishers are not interested in maintaining the status quo because they realise that first-party data is the game, the real asset, so why would they play the same game that they’ve got duped on for the last 10 years? The industry should accept it is dead and move on, it’s starting to feel like the unpleasant last year of a failed marriage at this stage.”

Opportunity

Although there is a stay of execution, the demise of third-party cookies is in the post. A significant proportion of ad tech is built on third-party cookies, so I asked O’Kane where the opportunity is for ad tech going forward. 

“I don’t see the same opportunity for ad tech in connected TV [CTV] outside the US, the rules of engagement are very different in Europe. We have never been wire-cutters because we’ve never had wires to cut; most European countries have free-to-air national broadcasters, so we were never in a situation where we paid massive subscriptions to get access to CBS or NBC-type content,” he says.

When it comes to ad tech, retail media is the great opportunity of the year and maybe the decade

“We won’t see the same adoption of CTV as the US, we’ll see stakeholders like RTÉ putting a lot of the inventory in a walled garden where it’s not biddable in an open exchange. I think the real opportunity is the aggregation of all these different inventory types packaged up and delivered to the buyers.”

He believes CTV is an opportunity but it’s not the runaway opportunity it is in the US and he says the big opportunity lies elsewhere. 

“When it comes to ad tech, retail media is the great opportunity of the year and maybe the decade,” he says. 

“Amazon places advertising on their platform retailers to sell products against their competitors or against a contextual line product. Amazon is generating around $8 billion per quarter; where did that annualised $30 billion revenue Amazon take in advertising come from? It wasn’t diverted from display or search; it was money previously sitting against in-store and point-of-purchase media. You’re going to see lots of market places running ads on their sites now, and for ad-tech that’s an open goal. With lots of disparate sites the opportunity lies in how to you manage these siloed walled gardens.”

“There’s a big measurement opportunity, there are over 80 marketplaces in Europe alone, so how do you manage spend across all these sites? Then there’s aggregation: who is going to aggregate these sites so agencies can easily buy and optimise against them all to sell more?” 

Display advertising will suffer a wobble because when the cookie goes away there’s no proxy for measurement, but the retail space doesn’t need a cookie because all these sites are intent laden, keyword- and context-based rather than behavioural. 

“You have this incredible environment to market to people,” O’Kane says. “If you are on a retail site you’re not averse to seeing ads, the user experience is very different, so rather than ads being an annoyance they are welcomed, because if you’re shopping for a food blender you probably are interested in ads for peripheral products like kitchen utensils; the context changes. I think it has been a blind spot for advertising and I think it’s going to be a huge opportunity.”

We covered lots more in our podcast, far more than I can cover in this article – O’Kane also sees gaming as another huge opportunity for advertising and ad tech. 

Metaverse

We moved on to the hot topic of 2022, the metaverse, and in O’Kane’s inimitable style he didn’t pull his punches. “It is nonsense, because it’s very confusing. We need to be wary of what Facebook did last year, it looks like a political move, almost sleight of hand,” he says. 

“To me the metaverse is a nonsensical term – gaming has been doing this for years. What’s the hook for me to use Facebook’s virtual world? I’m not going to meet you for a pint in this virtual world, it’s complete nonsense. Facebook really want to become a hub for gaming. They also want to control the currency within this virtual world, that’s where you gain real traction: this is a way in.

“That’s not me rubbishing virtual reality, because it’s only going to grow, but I don’t see why people want to go into this virtual Facebook world, I think it’s a PR play until they figure out how they build their digital currency.” 

O’Kane adds: “They really need to acquire a gaming company, but I don’t think they will be allowed in the next three years, and that may wound them severely.” 

Dave Winterlich, chief strategy officer at dentsu Ireland 

I enjoyed my talk with Ciarán, he’s a genuine expert but he doesn’t feel the need to publicise himself as an ad tech sherpa – he could easily make money as a tech consultant, but he doesn’t. 

His website (exchangewire.com) is a treasure trove of knowledge and insight; free consultancy, essentially. If you are interested in ad tech you could do a lot worse than check it out and sign up for the daily newsletter. 

Dave Winterlich is chief strategy officer at dentsu Ireland 


Inside Marketing is a series brought to you by dentsu and Irish Times Media Solutions, exploring the issues and opportunities facing the world of media and marketing. For more information, visit irishtimes.com/insidemarketing