Dive Brief:

• Publicis Groupe has partnered with demand-side platform (DSP) The Trade Desk as the ad holding giant steels itself for the expected deprecation of third-party cookies later this year, according to an announcement.
• Epsilon, Publicis' data-marketing arm, will pair its identity solution with Unified ID 2.0, a third-party cookie alternative originally developed by The Trade Desk. Making the solutions interoperable aims to preserve personalization at scale while maximizing reach for Publicis clients.
• As part of the deal, The Trade Desk will become the exclusive DSP partner for Epsilon's Core ID — which wields data on more than 200 million profiles — as well as the division's other owned platforms. Publicis' endorsement of Unified ID 2.0 comes as cookie alternatives broadly grapple with new questions around their viability.

Dive Insight:

With the Trade Desk partnership, Publicis takes a big step toward girding itself for the pending death of third-party cookies, a development that's set to have a serious impact on ad-targeting capabilities. Among the many cookie alternatives being developed, Unified ID 2.0 has gained significant traction, securing endorsements from a wide range of marketing companies including Nielsen, LiveRamp, AT&T's Xandr advertising unit and now Publicis.

As ad tech at large experiences contractions, The Trade Desk has also been a standout performer, successfully capitalizing on growing brand interest in channels like connected TV. The Trade Desk last month handed off operating duties for Unified ID 2.0 to Prebid.org, an industry nonprofit focused on bringing transparency and efficiency to programmatic advertising.

Publicis hopes that, by combining its own firepower with that of The Trade Desk, it can preserve personalization at scale and kickstart new growth in the face of an uncertain future for digital marketing. The move represents a bit of a retooling for Epsilon, a data-marketing firm Publicis purchased for a whopping $4.4 billion two years ago.

The goal of the acquisition was always to deliver personalization at scale while positioning Publicis as a data-marketing leader in the agency category. Rival firms, including Dentsu and Interpublic Group, previously made pricey acquisitions to round out their data expertise. But the levers for achieving personalization have been upturned by Google's plan to sunset third-party cookie tracking in its Chrome browser, as well as other changes like Apple making its mobile Identifier for Advertisers an opt-in feature and a proliferation of more stringent data-privacy laws in the U.S. and abroad.

Some analysts were initially skeptical of the Epsilon deal, believing Publicis paid too much for the firm or that it would have trouble integrating the business. Additional privacy considerations were also raised as an issue since the purchase made Publicis a bigger operator of data. On a recent earnings call, Publicis attributed some of its organic revenue gains, a key measure of health for agencies, to strengths in Epsilon.

While Unified ID 2.0 has won an impressive slate of backers, the solution is still in the testing phase and faces potential exterior threats. Google last month said it would not allow alternative user-level identifiers once third-party cookies are phased out.