Alternative ID vendors have been hardcore pitching advertisers for years that email-based IDs can work for CTV.
But skepticism still abounds.
To be fair, email-based alt IDs are a viable third-party cookie replacement for online display and video. And for many omnichannel advertisers, it makes sense to port alt IDs over to CTV, which is incompatible with third-party cookies. Smart TVs mostly run streaming apps, not web browsers.
But many CTV buyers and sellers aren’t convinced it makes sense to use a one-to-one targeting signal like email addresses in a media channel that doesn’t prioritize one-to-one ad personalization. They also worry that alt ID providers aren’t checking whether the data underlying these IDs is accurate and was provided with consent.
Another concern is that many free ad-supported TV (FAST) channels – which don’t typically have direct access to email logins – are creating email-based IDs using data sourced from third parties or other questionable sources. The worry is that such arrangements go against the spirit of alternative IDs, which are supposed to be based on a publisher’s first-party data. And if advertisers are being asked to pay premium CPMs for IDs built on the same murky third-party data they’ve always bought, what exactly are they paying for?
These aren’t just hypothetical concerns.
Sources who spoke with AdExchanger shared firsthand knowledge of FAST publishers creating alt IDs using third-party emails – and their memories of being warned not to dig too deeply into the data behind these IDs or their performance because they might not like what they find.
“I’ve been in boardrooms when questions have come about regarding, ‘Is the data targeting real? Is it accurate? And how do we defend it?’” said Mike Richter, co-founder and CEO of experiential events company Unplugged Collective and a former monetization manager at CTV publishers TEGNA, Jukin Media and Newsy (now known as Scripps News).
“And I’ve sat next to people who have said, ‘Don’t ask too many questions,’” Richter added.
Checking the work
But why are criticisms about the viability of email-based IDs in CTV bubbling back up now?
They’ve resurfaced in the wake of a recent incident in which The Trade Desk – which oversees its own email-based alt ID, called Unified ID 2.0 – didn’t realize that a CTV publisher was passing IDs that were based on improperly encrypted email addresses.
The encryption error made this publisher’s UID2s useless for ad targeting for a period of three months. But The Trade Desk never raised any red flags, a source at the publisher said, and fixing the error yielded no noticeable boost in revenue.
The CTV experts AdExchanger reached out to regarding the UID2 encryption failure story also had plenty of unanswered questions as to whether anyone in the alt ID space is actually checking to make sure the data behind these IDs is legit and whether they truly drive ad performance for buyers and revenue for publishers.
A large platform and alternative ID administrator like The Trade Desk missing basic encryption errors “raises questions about how deep the current checks really go” across the entire alt ID market, Richter said.
He added that, while the UID2 incident “doesn’t mean the whole system is broken,” it does suggest that ID providers are only checking for compliance with their protocols and standards and “not the underlying logic or integrity of the IDs.”
But Richter emphasized that singling out a single alt ID provider isn’t a productive way to tackle the ad industry’s pervasive data transparency problems, which go far beyond UID2.
“We need to push for a repeatable test harness action across multiple platforms, shared test data, expected outputs and independent verification,” he said. “If a big partner [like TTD] can’t reliably pass that, then it’s a signal we need stronger, industrywide QA and governance around these identifiers.”
However, Richter added that there are major technical limitations that prevent ID vendors from providing that level of transparency. “Is there enough processing power to do all that?” he said. “Is there enough time to do all of that and validate it?”
For its part, The Trade Desk told AdExchanger it would be impractical for its DSP to double check the underlying data behind each UID2 token sent in programmatic bid requests because of the sheer number of requests it sees. TTD added that there is no requirement by any oversight body for alternative ID operators to investigate the IDs included in each bid request.
FAST channels and first-party data
One of the clearest examples of this tension show up in the CTV market’s FAST channel ecosystem. FAST channels need email addresses to generate email-based IDs, of course, but they rarely get them directly from users.
A FAST channel is just one of many ad-supported channels hosted on linear streaming services operated by CTV manufacturers, such as Samsung TV Plus, The Roku Channel or LG Channels.
Typically, CTV manufacturers get first-party access to a user’s email login when that person initially sets up their TV and logs into other streaming apps downloaded to their TV. But individual FAST channel publishers themselves rarely have access to these email logins, according to Richter, who has worked for multiple FAST publishers.
Another source who previously worked for a CTV manufacturer that operates a FAST streaming service and asked to remain anonymous backed this up. Both this source and Richter also agree that it’s rare for CTV manufacturers to provide email login data to FAST publishers.
Meanwhile, FAST publishers often sell a portion of their channel’s ad inventory on their own, while the larger share of inventory is sold by the CTV manufacturer.
In cases where a CTV manufacturer is selling a FAST channel’s inventory, the manufacturer would have first-party email logins it could use to create email-based IDs, said Richter and the anonymous CTV manufacturer source.
But when a FAST channel sells ad inventory on its own, it’s most likely getting the emails it uses to create alt IDs from a third-party data broker. Both Richter and the former CTV manufacturer employee have firsthand knowledge of FAST channels buying emails from data brokers to create alt IDs.
Data matching consent
FAST channels aren’t the only ones getting emails from data brokers. TV and CTV publishers have been known to do the same in order to create alternative IDs.
For example, if a publisher has a physical address or IP address for a user but no email login on record, they will often rely on third-party ID graph providers to find that user’s email, according to multiple sources who spoke to AdExchanger for this story.
But although this arrangement might sound shady, it’s likely contractually protected.
If a user consents to providing some form of personal data for ad targeting, like a physical address, this likely gives the publisher permission to derive other signals that could also be used for ad targeting, like an email address, said Ana Milicevic, principal and co-founder at Sparrow Advisors and a board member at ID5, which manages its own email-based alternative ID and has a data partnership with The Trade Desk.
But even if there’s nothing technically wrong with a publisher getting a user’s email from a third-party data broker to create an alternative ID, doing so undercuts the original premise and sales pitch for these IDs, which is that they’re based on first-party data provided with a user’s full knowledge and consent.
However, relying solely on first-party data to populate these IDs seems to be less of a priority than it once was, the former CTV manufacturer employee told AdExchanger. “I don’t think that was scalable,” they said.
Do the IDs perform?
Even so, perhaps buyers and sellers could overlook their concerns about how alt ID tokens are generated if the IDs clearly delivered on the promised lift in auction win rate and revenue. But some sources remain unconvinced that alt IDs work for CTV as well as for online display and video.
Emails are a one-to-one targeting signal that make sense as a cookie replacement for display advertising, which is a one-to-one medium. But CTV is a channel where many people in a household may be watching at the same time. For that reason, CTV and TV ad targeting typically rely on one-to-many signals like household IDs and IP addresses.
However, because people have to log into streaming services with their emails, “there’s always going to be the ability to do some sort of one-to-one matching” in CTV, Richter said. But he added that “the problem is that it severely decreases your total addressable audience.”
That’s why “there’s no CTV targeting out there that’s solely based on a one-to-one email,” Richter said. “You’re still graphing that on a greater household.”
Meanwhile, one-to-one targeting methodologies like email don’t always map cleanly to one-to-many ID graphs. Match rates for IP addresses to emails are only accurate 16% of the time on average, according to a report released late last year by the Coalition for Innovative Media Measurement, Go Addressable and Truthset.
Milicevic acknowledged that the difficulty of matching one-to-one and one-to-many signals is a longstanding knock on using email-based targeting for CTV. But she added that this criticism is exactly what using multiple alternative IDs – as enabled by the TTD and ID5 partnership, for example – is intended to address. And alt ID signals can be further enriched by other audience and data graphs, she added.
Milicevic also pointed out that one-to-one targeting via email-based IDs can actually be more beneficial for certain marketers than one-to-many approaches.
For instance, pharma advertisers might want a more granular targeting signal they can use to only serve CTV ads when adults in a household are logged in, she said. This helps brands avoid “running into issues where somebody watching the Olympics on Peacock all of a sudden sees ads for erectile dysfunction drugs,” she said, “and then you as a parent need to explain what that is to your kids.”
Improving the ID ecosystem
All of these criticisms aside, it’s worth noting that some advertisers say using alternative IDs has improved their targeting and measurement, including for CTV.
Nevertheless, it can be hard to parse the exact impact of specific IDs since so many signals are sent in bid requests. Platforms also don’t always tie demand to specific IDs in their reporting. For example, The Trade Desk says it has no mechanism for doing so.
Given this lack of transparency in the reporting, it’s natural for CTV stakeholders to have doubts when they’re told that alt IDs drove performance.
So where does that leave the industry? And what changes do experts say are necessary to make these alt ID systems work better for the CTV channel, from clearer reporting to more accurate matching against other audience graphs, not to mention stronger oversight across the board?
The UID2 encryption incident “underscore[s] the need for transparency and better measurement,” said Milicevic, “because this type of data management is not new.”
In the US market, advertisers have been matching audience data graphs for 40 or 50 years now. But the methodology for combining data sets became well established “before there was any consideration for privacy,” she said, “and it was largely [built for] the offline world.”
As a result, she added, marketers are trying to adapt legacy systems to digital experiences, and so it’s inevitable they won’t always fit perfectly.
That’s no excuse for deliberately deceptive ID practices, of course, Milicevic said, but because misconduct persists, marketers need to be proactive to weed out bad actors – and it can help to just ask a few simple questions.
ID vendors should be able to give marketers transparency into how their tools work, for example, and most will be clear about what data sources they’re using and how audience graphs get combined. But “if they have very shady answers,” Milicevic said, “that’s probably a signal for you.”
Richter agreed that, when it comes to ID solutions, buyers and sellers should “question every single thing.”
“Ask them to show you results [and] examples,” he advised. “And if you don’t know what you’re looking at, find an expert to help you. Spend that extra $10K or $50K for an audit.”
Richter also urged the entire alt ID market to engage honestly with good-faith criticisms of the technology and how it’s applied for CTV ad targeting. He said he hopes the recent UID2 incident will put pressure on The Trade Desk to set a better example for the industry, but emphasized that the responsibility doesn’t rest on TTD alone.
“I don’t think it’s up to one entity to lead the way,” Richter said.
Above all, Richter implored the industry to express its concerns about emerging ad tech solutions publicly rather than whispering hard truths behind closed boardroom doors.
“It’s up to those of us that are part of this community to be leaders together,” he said, “[to] challenge each other and be okay with having the hard conversations.”
