Why the Google announcement doesn't change your strategy

In a significant shift, Google has announced that they will not be deprecating third-party cookies. This decision has sent ripples through the AdTech and MarTech communities. Let's break down why this doesn't change your strategy.

Summary of the change

Google will no longer automatically deprecate third-party cookies: Instead of making a blanket change to remove third-party cookies, Google will present users with an opt-in or opt-out message regarding the use of these cookies. Previously, Google had begun phasing out third-party cookies, with about 1% already phased out. Now, the choice will be left to consumers.

Users' choice: Users will be given the option to opt in or out of using third-party cookies. However, it is unclear what that experience will be like and what the messaging will entail. There are still significant questions about this and what the take-up rate will be, experience with Apple has shown that the take-up rate may well be low (covered in more depth below, see 'Likely opt-out rates').

Decision is not final: Google has continued to shift their thoughts and actions on third-party cookies and this new announcement will need to progress thru the reviews in UK Competition and Markets Authority (CMA).  There is also no clear timeline on when this will take place.  

Privacy sandbox remains: Google has also restated that their Privacy Sandbox will remain in development, and they will continue to invest in this product. They additionally released some case studies on its effectiveness, yet other parties like Criteo have an alternative view (article on AdExchanger).

Why this doesn’t change your strategy:

Privacy: Governments across the globe are continuing with their review of privacy legislation and the protection of their citizens data usage and their right to consent of that usage. This is a trend that is not going away, rather gaining momentum.

Consumer expectations are evolving: Users are increasingly aware and concerned about their online privacy. While consumers may not fully understand how they are being tracked, they know it is happening. Brands that navigate this landscape with transparency and respect for user data will ultimately win consumer trust and loyalty. Consumer choice should be focused on the decision to interact with the brand itself, rather than widely sharing data through mechanisms like third-party cookies, inhibiting the user's ability to track and understand the distribution and use of their data.

‍Non-chrome browser %: This will likely remain solely a Chrome solution. In most advanced economies, Chrome has about 40-50% market penetration. From our discussions with partners and customers, we have learned that a Safari-based audience differs significantly in engagement, attributes, and segmentation. To maximise engagement, businesses need the ability to thoroughly analyse, assess, and act on these findings.

Likely opt-out rates: If Apple IDFA/ATT opt-out rates are any guide, we could see 80-90% of users opting out of using third-party cookies in Chrome. First-party identifiers will continue to play a crucial role, enabling activation on users who have opted out of third-party cookies, while providing improve consumer privacy compliance.

The inevitable shift to privacy-centric models: While third-party cookies in Chrome are here to stay for now, the industry is already moving towards more privacy-centric models. First-party data, consent-based marketing, and alternative identifiers will continue to gain traction. The survival of publishers against big tech is dependent on their ability to further re-enforce the quality of their own data, rather than relying on third-parties collecting and monetising the same data. In short adopting a first-party strategy helps ensure growth, while protecting your users' privacy.

Innovation won’t stall: The push for innovation in privacy-preserving technologies won’t stop. The industry has already seen significant advancements in first-party data matching for advertising, leveraging match rooms or data clean rooms. These innovations are here to stay and will only grow more sophisticated.

First-party data: Businesses have created strong data assets, with first-party data being used to optimise business functions and consumer behaviour. From a publisher's perspective such data assets are extremely valuable - publishers will continue to seek to own and control such first-party data for known and unknown audiences. The value is high for Advertisers also, illustrated by their continued adoption of Customer Data Platforms and the drive to customise experiences for both authenticated and unauthenticated users. In short, savvy businesses will continue to rely on first-party cookies and data to understand, analyse, and capitalise on both their anonymous and known audiences.

Final Thoughts

Google’s announcement may provide a brief respite for digital advertisers, but it doesn't alter the broader trend towards a privacy-first internet. During this period, businesses should continue refining their strategies by prioritising robust first-party data practices and exploring innovative privacy-preserving technologies.

Importantly, the rationale behind phasing out third-party cookies remains sound - they enable chaotic and uncontrollable collection and monetisation of consumer data by almost any internet marketer. Even with opt-ins, publishers may still be obliged to safeguard consumer privacy, potentially leading to restrictions on third-party cookie use. Moreover, enabling third-party cookies with explicit consumer consent doesn't ensure users fully comprehend the privacy impact of their decision. It's widely recognised that only a small percentage of consumers truly understand these implications.

Continuing to enable third-party cookies risks hindering the progress towards a privacy-focused internet, jeopardising both consumer privacy and the integrity of publishers' first-party offerings.

The future of digital marketing is clear: it’s about striking a balance between effectiveness and respect for user privacy.