Google is set to stop the use of third-party cookies in their hugely popular browser, Chrome. As many advertisers will know, this has huge ramifications, and many are wondering what the future of digital marketing will look like.
The removal of third-party cookies will make it harder for advertisers to track the web activity of potential consumers, which will have a considerable impact on things like remarketing.
Third-party cookies have helped advertisers target ads depending on the data they collect: this could range from age and gender to historic behavior on websites and search history.
This move from Google is to appease the concerns of their audience: consumers - who have grown more aware of the capture and use of their personal data - increasingly perceive third-party cookies as a form of privacy-invading technology.
When is Google scrapping third-party cookies on Chrome?
Google is currently set to phase out third-party cookies in Chrome by 2024. This comes after a few delays, primarily because Google wanted marketers to have more time to adjust their advertising approach and test out new, less intrusive targeted advertising technologies.
What’s the alternative to third-party cookies?
With no third-party cookies to rely on, advertisers will have to look to first-party cookies for targeting information. These types of cookies are stored on domains and can be used for things like on-site search optimization and recommendation systems.
As an alternative to reliance on third-party cookies, Google has been building the Privacy Sandbox, which is planned to be a less intrusive solution to targeted advertising. The Sandbox is a collection of technologies that aim to protect people’s privacy online, while still providing businesses with tools to advertise successfully.
As part of the Privacy Sandbox, Google has introduced the new Topics API. This is a new proposal for cookie tracking. The algorithm works within a user’s browser and classifies them within a set of high-level interest groups, such as fashion, food, or travel. This broad grouping can then be used for targeting.
Who will be the most affected by the cookie changes?
The shift towards relying on first-party cookies will heavily favor large companies that have the most access to first-party data. These companies will have the resources to develop the most effective algorithms for maximizing profits with just first-party data.
Smaller companies that lack first-party data will struggle to target and remarket to shoppers, making it harder to advertise. Small businesses will still be able to make use of technology such as Google Topics to segment users into interest groups and leverage data that way.
Will this change give Google more power and control over retailers?
With no third-party cookies from Chrome to use in advertising efforts, retailers may turn to Google services such as Smart Shopping or Performance Max to gain visibility on Google Shopping and improve their profits. These are both ‘black box’ advertising algorithms that advertise on a retailer's behalf.
Everything you need to know about Google's Performance Max
The problem with relying on these services is that it gives a lot of control to one company: Google decides which retailers can enter the auction for the advertising space, the bid price, and who wins the auction.
It also puts a lot of reliance on algorithms that give limited data feedback, such as search term data, so there’s a lack of accountability. It also means that retailers have less data available to use in advertising optimization efforts on other channels.
What can companies do to prepare for the change?
Utilizing first-party cookies will be the best method of reacting to Google’s changes. This data can be analyzed to help you create targeted ads across Google, Facebook, and YouTube.
A commonly used tactic for companies to increase the amount of first-party data they have is through the use of newsletters which collects data. Creating high-quality content for users to interact with can also provide you with more data.
