Dive Brief:

• Nielsen will eliminate its reliance on third-party cookies for audience and outcomes-based measurement in the U.S., a press release announced.
• To measure authenticated traffic, the firm will now use identifiers and first-party data sources provided by clients, such as hashed email addresses, verified self-reported demographic information and the cookie alternative Unified ID 2.0. For unauthenticated traffic — logged-out traffic or traffic stemming from properties that do not support alternative identifiers — Nielsen will apply a mix of machine learning (ML) technology and contextual data signals, including time, browser, content and device information, along with tapping into Google's Federated Learning of Cohorts (FloC) groups.
• The shift away from cookies comes as Nielsen props up a new measurement system that unifies its data sources and tries to make them interoperable across media. The company says it's focused on combating data erosion and helping clients navigate an increasingly fragmented media ecosystem.

Dive Insight:

Nielsen's decision to cut out third-party cookies is another sign that the firm is in a transitional period as digital marketing needs quickly change. In February, it introduced a cookieless solution for cross-platform audience measurement called Identity Sync, but the latest announcement appears to carry a broader purview across Nielsen's audience and outcomes measurement business.

Getting consistent measurement and attribution on digital channels has been a longstanding challenge for marketers, while the largest digital ad platforms, such as Google and Facebook, are viewed as opaque walled gardens. The death of cookies adds another layer of complexity to the space, but could also usher in new measurement methods that may be more sustainable and privacy-safe in the long run — or at least, that's what companies like Nielsen hope. One big question is how effectively unauthenticated traffic can be tracked using tools like ML or Google's FLoCs, the latter of which have drawn some skepticism.

In ditching cookies and other "brittle identifiers," as Nielsen termed them in the announcement, the company looks to focus on more stable offerings. Those include Unified ID 2.0, a cookie alternative originally developed by The Trade Desk that has been endorsed by many players across the marketing industry. Nielsen is also positioning the move as a way to strengthen a Nielsen One platform introduced late last year that combines the firm's insights into traditional TV, streaming and digital in a bid to establish a single cross-media solution.

The company claims to measure nearly 90% of total digital video spend through its Digital Ad Ratings, and says nearly 60% of that spend is already resilient against the death of cookies. Google in June said it would delay its plan to phase out third-party cookies to 2023, giving marketers an extra year to sort out alternatives.

Meanwhile, Nielsen beat earnings estimates in the second quarter, demonstrating marketers' need for measurement partners isn't cooling despite larger uncertainties. Total revenues were up 6.2% year-over-year to $861 million.