Google Chrome and the End of Cookies. What Will the Impact Be on Ad Businesses?
The 2020 COVID pandemic created a new era of eCommerce and usage of marketing platforms. Customers are increasingly connected, mobile and socially influenced, therefore retailers of all sizes have the ability to create an effective online presence with digital advertising and leverage a multitude of advanced tools to drive more engaging experiences for their customers. Nine out of ten shoppers are now prioritizing experience using retail platforms that enable a seamless experience in store.
The growth of digital and social media platforms carry different responsibilities when exposing personal data. On one hand, users seek data protection since they do not want to be overloaded with digital advertising or have important data like passwords and bank numbers stolen. On the other hand, advertising industries seek to use this data to create personalized customer experience in their websites and targeted ads. However, earlier this year Google announced that by the end of 2023 it will end third-party cookies in Chrome, its proprietary browser and the most used in the world. This was a great shock for companies that use Google Chrome, Adwords and Analytics as part of their marketing and communication strategies, as they will have to rethink their advertising plans to track and target users in the near future.
Third-party cookies are those sent to the computer, cellphone or other device connected to the internet by a third domain, that is, outside the page being visited, and are commonly used to track user habits and offer personalized advertising. They can be differentiated from firstparty cookies sent to the system by the browsing history to facilitate future visits by remembering user names, passwords or browsing preferences. Due to the valuable information they provide about digital users and their preferences, cookies constitute a basic pillar for advertisers and publishers, and are used to sell advertisers digital broadcasting spaces adjusted to the target audience.
51% of buyers surveyed say that they use Google Chrome to find information about a purchase they plan to make online (Think with Google, 2019), so companies rely heavily on this platform to track user data through cookies and create targeted ads.
That is why when Google made the declaration that they would stop using third party cookies, the obvious question was: does this mean that companies will no longer be able to track user data? And what does this represent for ad businesses that depend on ‘cookies’ to create product positioning, targeted advertising and google ads?
It is important to note that Google makes most of its revenue through paid advertising delivering results for advertisers, and its services rely on third party cookies in one way or another. Until June 2019, 94% of internet searches occurred in a company belonging to Google. (Jumpshot via Sparktoro, 2019). So Google ending Chrome’s support of thirdparty cookies is not the end of tracking in Google Chrome. The need for true end-user consent to process personal data will persist long after third party cookies and the technologies replacing them.
It was not an overnight decision, other web browsers were on the same boat. Apple began to implement it with Safari and Mozilla with Firefox, promoting its own mechanisms to block thirdparty cookies, a basic element of the functioning of the webs and, above all, fundamental for online advertisers. Google’s decision continued this trend to have more privacy for Chrome users, however it also opens the door to consolidate its monopoly. How? Promoting a successor of cookies that is of interest to Ad Managers and the adtech industry in general.
To mitigate the great impact that the suppression of thirdparty cookies in Chrome may have on the digital advertising market, the Mountain View (California, USA) firm relies on its “Privacy Sandbox” initiative, which is still in development. Announced in 2019, Privacy Sandbox aims to create open standards that improve privacy on the web, allow users not to share their data or online activities as much as possible and, at the same time, be useful for advertisers and publishers to create targeted ads for specific audiences.
The launch of open standards is still a few years off, so what can companies do in the meantime to take care of their users’ data? One option is to use a consent management platform ensuring that your website detects and controls all cookies and trackers, delivers transparency and a choice of true consent to its users before collecting their personal data.
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