What is Unified ID 2.0? Its Relevance in the Present AdTech Ecosystem

Universal ID work is to provide shared identifiers for tracing users throughout the chain of supply without syncing cookies. Universal IDs were modified into what is known as Unified ID, and now Unified ID 2.0 or UID2.

For as long as we can remember, data has been at the very heart of how the ad tech industry works and identifies its target audience. This was done primarily by syncing cookies.

For identifying users, every ad tech partner would synchronize the third-party cookies with one another. However, there was no standardized solution for identifying users across different platforms, and this often resulted in the loss of data of users.

Also, all this resulted in slow loading of the page, disrupted user experience, and also resulted in reduced match rates. All these, coupled with the security concerns escalating among people, led to the gradual phasing out of Third-party cookies.

Also Read: Third-Party Cookies Alternatives: 7 Best Choices for Publishers 

Browsers like Safari and Firefox have already banned Third-party cookies, and Google intends to do that by early 2024. Although they have delayed the phase-out, the industry and the markets are already facing the brunt of the changes, as pointed out.

This gave rise to the need for standardized Universal IDs.

In 2016, the very first Universal ID was introduced by LiveTramp as an alternative to Third-Party cookies.

They were soon followed by Trade Desk in 2018 with the Unified ID or UID as a form of a universal aggregation tool.

Now to make UID more effective and to enable it to future-proof ad campaigns in a better way. Unified was modified into what is now known as Unified ID 2.0 or UID2.

UID is popular for ensuring better transparency because, in this case, the user has to provide consent to allow their personal information to be put to use by advertisers.

UID is popular for ensuring better transparency because, in this case, the user has to provide consent to allow their personal information to be put to use by advertisers.

To understand UID2 better, lets’ look into the following points:

• What is Unified 2.0?
• Where Does the Relevance of Unified 2.0 Lie?
• Some Important Features of Unified 2.0 – Unified Id 2.0 Explained
• How Does it Work?
• Some Major Benefits of Unified 2.0

What is Unified 2.0?

Unified ID 2.0 or UID may be referred to as an alphanumeric identifier, which is unencrypted and focused on privacy. It is created from the email id or phone number of the user.

The best part is that it is not dependent on Third-Party cookies and helps the advertisers to run personalized ads targeted towards specific consumers. All this is done without having compromised the privacy of the users. 

• The updated version of Unified 2.0 follows the Interactive Advertising Bureau or IAB’s Project Rearc principles.
• The principles cater to the security and privacy of the consumers by means of developing platforms for supporting stakeholders of digital advertising.
• UID2 is designed to assist publishers as well as advertisers in targeting users without depending on Third-Party data. 

The partners of UID2 are multiple as well, including data providers, Supply Side Platforms, and publishers. The governance of the framework remains in the hands of the IAB Tech Lab, in spite of having refused to become the administrator. 

This open-source ID framework is different from the others in the way that here the users are required to provide consent to the publisher and also share their email ID before their Unique Identifier can be created. This ID will be kept open but hashed constantly for the protection of the user’s privacy.

How Does Unified ID 2.0 Work?

The process of its functioning can be broken down into the following steps for better understanding:

• A consumer visits a website, mobile app, or CTV of a publisher and is asked for permission for his PII Or Personally Identifiable Information to be put to use. There should be transparency on the part of the publisher with regard to the value exchange thus proposed – for instance, the PII in exchange for access to the content.
• If the user agrees, he has to sign in using his email id. At this point, the user will have the scope to customize his privacy settings. 
• The app developer of the publisher will then send the privacy settings and the PII to the UID2 operator.
• The operator will then process the information by hashing or salting it with the help of an encryption key from the UID2 admin.
• Next, the publisher will receive this encrypted information in the form of a UID2 token. It is then shared with its Supply Side Platform or SSP.
• Now during RTB or Real Time Bidding, the SSP sends the token to the data of the bid stream. At the same time, the token will be shared with the Demand-Side-Platform or the DSP by a data provider or an ad exchange.
• The same token is also kept in store on the browser of the user in the form of a First-Party Cookie. However, no PII is directly shared or sent to the Bid Stream. 
• Now that the bid request is received by the DSP in the form of this token, it will be decrypted so as to uncover the raw UID2 so that the bidding is successful. The decryption keys used by the DSP will also be provided by the UID2 admin. 

However, in case a user decides to withdraw the consent, the information will be passed on to the DSP by the UID2 administrator.

Read More: What are the Types of Cookieless Data for Publishers

Some Important Features of Unified 2.0 Explained

Now that we have established why Unified 2.0 is important let’s take a look at some of its major features, which actually make it relevant in the ad-tech world.

Interoperable and Open Source

Since it is Open-source, participants can use it completely for free and can move on fast towards scaling without the requirement of cookie-syncing in any way. The interoperability factor helps it in its communication with UID2 partners and their proprietary solutions. 

Advanced Security Features

UID2 ensures that all the email ids are encrypted, hashed, and regenerated on a regular basis via “salting”. The process of “salting” refers to the addition of random characters before or after a certain password for the purpose of making it more secure. 

Audits on a Regular Basis

The Compliance Manager of the UID2 makes sure that audits are conducted regularly on the UID2 participants to determine their role in compliance before the results are relayed to the UID2 operators and administrators. 

Control of Privacy and Transparency

Before the consumer allows his/her email-id to be stored, the publishers will be obligated to disclose to him how exactly will his/her data be used. Every user can keep track of how his/her data is used after s/he logs into a site. He may even withdraw his consent if he feels like it at any time.

If the email id is encrypted once, it will not be possible to revert it to its original form or any previous hashed formats.

Also Check: IAB’s Project Rearc: A Possible Solution To Third-Party Cookie Apocalypse

Some Major Benefits of the Unified 2.0

The industry is now at a juncture where they have to be relying lesser and lesser on Third-Party Cookies. So at this point, the entire ad-tech industry can benefit from Unified ID 2.0 in the following ways:

Cross-Site Targeting

The framework that is dependent on the consent of the user makes sure that the preferences of the user are shared among the UID2 partners. This way, cross-site targeting can remain as it is. 

Flexibility

Since UID2 is Open-Source, any entity can propose updates and modifications for UID2 so that its functionality can improve over time.

Self-Regulated

As opposed to cookies, all the stakeholders for Unified ID 2.0 will have to comply with a set of rules and regulations laid down while they use the encrypted ID. The privacy of the users can be ensured in this way.

Where Does the Relevance of Unified 2.0 Lie?

Companies have been forced to respect the privacy of consumers with the introduction of the General Data Protection Regulation or GDPR of the European Union. The codes of conduct laid down in the Unified 2.0 initiates building the consumer’s trust in the publishers and the advertisers.

This happens as UID 2.0 works its way towards demonstrating its responsibility towards an increasingly transparent, secure, and precise ecosystem of the advertisement industry. 

As for the customers, with UID2, they get the chance to manage their preferences by customizing it in a way that only the relevant ads are made available to them. As a result, the presentation also turns out to be more accurate as well as effective. The best part is that they can also go ahead and withdraw their consent if they wish to do so at any point in time. 

However, UID2 is not just about privacy. It is also popular for the important role it plays in the performance of the ads and the potential Return on Ad Spend (ROAS).

As per a report of the Trade Desk, the UID2 framework has actually brought about an increase in the effective CPM by 116% in comparison to advertisements that still use Third Party Cookies.  

Keeping everything in mind, some enterprises have already started embracing it as the standardized framework for ID tokens that are unique to users. Some famous ones among them are Tubi, The Washington Post, Interpublic Group (IPG) as well as the Publicis Groupe. 

In a Nutshell

Now that laws regarding consumer privacy have been integrated into the standards of digital media, advertisers and publishers are in dire need of meeting these privacy requirements. Programmatic advertisements have got themselves modified too to meet these requirements, especially when it comes to the protection of data, identity, and privacy. 

In this scenario, Unified ID 2.0 makes the promise to make ad strategies future-proof in a situation where Third-Party cookies have become almost obsolete. So it becomes evident that it is time for advertisers and publishers to pay heed to the full potential of UID 2.0.

AdPushup helps publishers get an average 40% uplift in ad revenue through the use of programmatic advertising technology and ethical guidance. Contact us today to learn more about how AdPushup can help you implement Unified 2.0 and boost your ad revenue!

FAQ – Unified ID 2.0

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