Exclusive: New York Times phasing out all 3rd-party advertising data

The New York Times will no longer use 3rd-party data to target ads come 2021, executives tell Axios, and it is building out a proprietary first-party data platform.

Why it matters: Third-party data, which is collected from consumers on other websites, is being phased out of the ad ecosystem because it's not considered privacy-friendly.

• This has forced several big publications to rely on their own first-party data, or data that they collect directly from their users.

Beginning in July, The Times will begin to offer clients 45 new proprietary first-party audience segments to target ads.

• Those segments are broken up into 6 categories: age (age ranges, generation), income (HHI, investable assets, etc.), business (level, industry, retirement, etc.), demo (gender, education, marital status, etc.) and interest (fashion, etc.)
• By the second half of the year, The Times plans to introduce at least 30 more interest segments.

"This can only work because we have 6 million subscribers and millions more registered users that we can identify and because we have a breadth of content," says Allison Murphy, Senior Vice President of Ad Innovation.

• Murphy notes that the company has invested significantly in building out the proprietary targeting solution. "We hired a large team specifically to support this year of a dozen people. The effort has touched at least 50 people and many more in every part of company to get this to work."

Between the lines: The effort is part of a greater push to a privacy-friendly experience from The New York Times.

• Last year, Axios reported that the company's marketing team will no longer use tracking pixels from Facebook and Twitter to track its users' browser history.

The big picture: Many online publishers still use third-party data, which is collected from consumers on other websites using tracking tools, to target consumers with ads.

• But changes to major web browsers to crack down on third-party data collection and new internet privacy rules are making that practice less viable.

Yes, but: Not all publishers have the scale, or user trust, to build out their own first-party data sets.

• Murphy notes: "While a differentiator and I'm thrilled about it, this isn't a path available for every publishers, especially not local who don’t have the scale of resources for building from scratch.."

Be smart: Other publishers like Vox Media and The Washington Post have also begun building out first-party data solutions in response to the growing industry backlash against using third-party data to target ads.