Google has finally announced they’re phasing out third-party cookies within the next two years, this has created a lot of unknowns as to what the future of digital advertising may look like.
What’s the issue?
Ad-tech on the web has traditionally been underpinned by third-party cookies. Conversion tracking, cross-site targeting, and frequency capping all currently rely on a third-party cookie to work. Cookies, however, are old technology solving a problem they weren’t originally built for and risk being misused by some publishers.
Users are becoming increasingly aware and concerned about how companies are using their data. Scandals like Cambridge Analytica have put a spotlight on how the technology industry is targeting users while governments are getting involved and trying to enforce large tech companies to clean up their act. Removing third-party cookies is a step towards moving the control of user data from the publisher to the user.
Google has made a public commitment to creating better privacy for users, while still supporting advertisers, publishers, and the ad-supported internet. With Safari & Firefox having already phased out third-party cookies, Google announced in January that they will do the same in Chrome within the next two years.
Google has committed to working with the industry to introduce a new set of less-intrusive, privacy-friendly technologies to replace cookies. However, this is a significant change for ad-tech and there are a lot of unknowns.
Many advertisers have become reliant upon using third-party data to target their audiences. In a cookieless world, this will no longer work and it is predicted that some of this spend may shift to more contextual advertising or leverage a new alternative approach.
Google is pushing an alternative approach to cookies which they’re calling the Privacy Sandbox. In their own words, the project's mission is to “Create a thriving web ecosystem that is respectful of users and private by default”. The project is a set of proposals for alternative solutions to cookies that respect the user’s privacy.
In the programmatic space, Universal ID solutions are expected to grow in popularity. Most programmatic supply partners we’re talking to are implementing wrapper solutions to enable publishers to support various ID platforms like Liveramp & The Trading Desk’s Unified ID. Publishers may look to implement first-party data strategies so they can leverage these. This could be difficult as publishers will need to have an identifier like a hashed email address. Communicating the value exchange between the publisher and their audience is an important part of this strategy.
What we’re doing:
We believe relevant advertising is better for the consumer, better for the advertiser and good for the open internet. However, respecting our users wishes in regards to the use of data comes first. Currently, every member can choose to agree to receive relevant, persona-targeted messaging when signing up for a Trade Me account. For the relatively small proportion of users that opt out, we leverage our extensive contextual targeting capabilities with category-specific behaviour across all areas of the site, from new homes to surfboards.
There are still a lot of unknowns on the impact of this change, but equally a lot of opportunity. We believe if the industry does a better job of respecting user’s privacy and data, we can create an ad-supported internet that works for everyone.