For 25 years, as the world changed around us, one thing in advertising remained constant: the cookie. Google's announcement that it will eliminate third-party cookies from Chrome by 2022 to provide users with "more transparency, choice and control over how their data is used" is a good reminder of the primacy of user needs and that in advertising, as in all things, you should take nothing for granted.
So, what do we know about our new post-third-party cookie future? Right now, the answer is not much, but this gives us the opportunity to imagine and determine a better one. Google has announced its "Privacy Sandbox", a collection of anonymised signals within a user’s Chrome browser that provide an alternative to cookies in a privacy-first way. Currently in its infancy, the particulars will be ironed out by the World Wide Web Consortium (W3C) – the law makers for the internet – over the next two years.
Until then, here is what we expect to happen next and what brands can do now to prepare for diminishing cookie space:
1. Media budgets will shift further into first-party and non-browser environments
It has felt like a long time coming, but come 2022, targeting capabilities on the open web (outside of walled gardens) are likely to become significantly limited. A sensible reaction to this change would be to shift investment into environments that still allow some of these practices to work – first-party and non-browser environments. The two most obvious homes for this are of course Google and Facebook’s walled gardens, as well as connected TVs, mobile apps and other growth development areas over the next 24 months. Marketers shouldn’t be scared into making any knee-jerk reactions just yet, however, but should keep an eye on the opportunities and any further privacy-related actions that could affect more than just browsers.
2. Major headwinds for third-party providers
After last week’s headlines, some commentators have already labelled the third-party data industry as "dead". Although there are plenty of unknowns, one thing is certain – come 2022, companies that have built their business on selling third-party data for targeting will need to seek out new opportunities in analytics and insight generation to survive. The need for marketers to learn more about their consumers will not go away, so there is a clear opportunity to expand into this area, but doing so will need to involve different models, higher standards for data ethics and compliance with new laws.
For brands and agencies, new "clean room" environment like Google’s Ads Data Hub, and platforms from newer companies like Infosum that enable data matching and analysis in privacy-first environments, may become vital tools for matching datasets in an ethical and compliant way.
3. Large publishers will gain more influence and control
Post-GDPR, we’ve already seen that publishers are in control of collecting consent from consumers and the latest changes will push control further their way. The lack of third-party cookies will mean that marketers will struggle to identify and target audiences at scale across the open exchanges. Instead, they may work more closely with publishers directly to forge programmatic guaranteed deals in order to access their key audiences.
Second-party data has been growing in importance since GDPR, but the approach will need to shift away from data as a service and back towards packaged publisher deals – with data laid on top of their own inventory – keeping everything within a first-party cookie space. While this will be great for larger, more established publishers or those with niche audiences, smaller publishers may struggle to break through with advertisers or find a place on media plans.
The imminent threat to third-party targeting is also likely to continue to renew our interest in contextual advertising which, when combined with other new technologies and planned in close partnership with the publisher, can produce some groundbreaking results.
4. More probabilistic measurement (and frequency) solutions
When audiences flocked to digital, so did advertisers, and with the move came a higher expectation of one-to-one targeting and measurement. Marketers have become used to the digital utopia of precision audience targeting, frequency capping and comprehensive measurement covering every single impression and interaction. In the post-cookie world, marketers will have to adapt to more probabilistic methods that protect users’ privacy and still enable the evidence-driven decision making and optimisation.
From a measurement perspective, we suspect Google will be planning something similar to its frequency capping solution for Safari, alongside the conversion measurement API in the Privacy Sandbox, although it will be important for marketers to look into all options available. Conversion tracking will still (as things stand today) exist across mobile apps and walled gardens, carrying out controlled experiments or using incrementality as a base to build out predictive models.
So, what should brands do?
In the short term, brands should focus on future-proofing their marketing stack by securing consent to build and expand their first-party data sets across multiple types of identifiers, such as email addresses and mobile app IDs. This will give the most flexibility to communicate with their customers, whatever the future brings.
To accelerate this, customers need to be educated on the value exchange of sharing their data, understanding how their data will be used, how they will benefit and what measures are in place to protect their data. Facebook’s privacy control campaign and Barclays’ Digital Eagles are great examples of educational programmes that explain how people can control their data.
In the long term, the reality is we won’t have the same availability of one-to-one data freely available and while that could be daunting, it’s no bad thing. We should all be excited about the opportunity to build a sustainable future for the next quarter of a century, based on trust and relevance in which advertising is delivering real value to consumers, publishers and brands. Doing so is essential to ensure the survival of a free and open internet.
Belle Cartwright is data strategy director at Essence