At the beginning of the year, Google announced that its Chrome browser would eliminate the presence of third-party cookies, making Chrome the third major website browser to take this step following Safari and Firefox who made the move in 2020 and 2019. Google’s move is certainly the most significant though, simply because of Chrome’s dominance in their share of browser usage.
Safari and Firefox together only impacted a little less than 25% of browsers, but with the addition of Chrome, third-party cookies will now be blocked on over 85% of browsers worldwide. We all need to understand the change and how it affects our own website monetization strategies and digital marketing efforts because this is the new normal.
What It Means
What this really means is that sunglasses, shoes, or any other product you considered purchasing at one point will not be able to follow you around the web anymore, enticing you to return to your cart and finalize your purchase. You, as an individual, and your personal browsing habits will no longer be purchasable and targetable with this change as Google is dismantling the infrastructure that allows for individualized tracking on the web.
That does not mean you won’t be able to target people who like sunglasses or shoes, but the ability to target a user as precisely as we once did is going to be a thing of the past.
However, what may seem like a privacy win for consumers might actually be a move that serves to solidify Google’s stranglehold on advertising on the web.
How Google is Replacing the Third-Party Cookie
In response to its own change in policy, Google is launching the Privacy Sandbox and the Federated Learning of Cohorts (FLoC) to replace some of the functionality marketers are losing.
Using a combination of artificial intelligence and your own web history, FLoC will place individuals into certain cohorts or groups based on interests. Google hasn’t yet defined what these groups will be yet, only to say they will be “large groups of people with similar interests”. In other words, when you look at shoes in the future, you will be grouped with other individuals that also shop for a similar type of shoe, and marketers will be able to target that group. Sounds pretty similar to a lookalike audience, doesn’t it? I would also expect that marketers will be able to build custom audiences from these cohorts, mixing interests to create a custom audience target. (Again, sound familiar?)
Aside from removing third-party cookies, the Privacy Sandbox also claims to resolve issues with ad fraud and introduces new ways to measure ad campaign performance, both arguably positive things for marketers.
In other words, this change isn’t going to hurt Google at all. Google will maintain its ability to target its own users using its own first-party data. And when you’re the largest search engine in the world, and you own everything from Google Pay to Gmail and YouTube, you’re going to have a lot of data to work with. This move makes Google’s advertising business even more valuable.
What It Means for Publishers
Again, much like with Apple’s privacy changes that are soon to be affecting Facebook, there will be disruption in the advertising ecosystem. With that disruption comes challenges and opportunities.
Let’s start with the challenges. If you are a publisher that has been driving digital revenue by selling audiences and inventory that are not your own, these changes are going to hurt you.
Publishers have historically been successful by building loyal audiences and selling access to those audiences through their own products. Audience loyalty lies with the content, brand, and mission of the publisher. In exchange for that content, perspective, and those recommendations, the publisher is rewarded with loyalty and engagement, which can then be monetized with advertising.
Skipping the process of developing quality content while skillfully and strategically engaging your audience doesn’t make you a better marketer, (a skill that you can use and leverage to help brands reach your owned audiences) it makes you a middle man, and middlemen ultimately get eliminated.
Of course, replacements to the third-party cookie are in the works, but the tide is turning on consumer education and preferences around privacy. Even more significantly, privacy legislation is just getting started. First GDPR then CCPA and now more coming to a state near you. Privacy is not a trend, it’s our new reality.
All that said, watch for challenges to Google’s move on the third-party cookie. The company is already being sued by the FTC and a handful of states with amendments to those suits coming on the heels of Google’s cookie announcement. So, stay tuned.
There are also certainly positives for what this could mean for publishers. Much like the imminent changes in Facebook targeting, these changes mean that advertisers are going to have to shift how (and where) they think about reaching their target audience. For smaller businesses, this presents the opportunity for local publishers to step in and act as a marketing consultant, helping them better understand the changes in the digital advertising landscape and how they can best use their marketing budget to accomplish their goals.
Publishers need to be ready to articulate their own first-party targeting capabilities and their own first-party data targeting functionality. If you are a publisher that has not invested in building your own audience and the first-party data that comes from that relationship, it’s time to jump on the bandwagon. The future is first-party. Your value to advertisers will stem directly from investments in audience development. Start building a plan now, 2022 and the cookieless future will be here before we know it.