In the digital world, the death of cookies is an unprecedented privacy revolution. Tools which restrict all the information collected by cookies, like the Intelligent Tracking Prevention (ITP) in Safari, the complete elimination of third-party cookies in Chrome by the year 2023 and the iOS14 as a highly secure operating system in existence till now, have been developments that have placed the whole digital advertising industry in check.
In 2023, Google Chrome will be eliminating third-party cookies globally, a move that Firefox and Safari have already made.
Third-party cookies enable us to know and collect information about users such as their interests, preferences and their behaviour on the web, along with personalizing advertisements to their tastes and likes. Basically, these cookies help in obtaining a user profile.
There are two aspects to this decision of eliminating third-party cookies. While it is a big step forward with regards to user’s online privacy, it will also prevent advertisers from using a mechanism that they have become adept at and grown accustomed to over the last few years.
What changes is Google introducing?
Google will be implementing a new policy which will not allow the use of any third-party cookies. The search engine giant is claiming this to be a move directed towards enhancing the user experience and offering improved privacy and clarity when using the Chrome browser.
Though third-party cookies rarely can result in computer viruses or other malware, many people are concerned about their widespread use. As per a study conducted, Google claims that at least 72% of users are of the view that companies track all their online activities, and 81% feel that the risks inherent in third-party data collection nullify any benefits. Hence, clearly Google is emphasizing user privacy and the relationships between users and first-party companies.
How does this change affect Digital Marketing?
Though this policy change might not entirely spell doom, at the same time it is something which can have a negative effect on digital marketing agencies. The agencies most likely to be affected by the change will be those that excessively rely on pay-per-click advertising.
Now, instead of being able to directly track user data, digital marketing companies will have to depend on a new system that Google is introducing known as the Federated Learning of Cohorts or FLoC. It is a system that will let Google use all user data for sorting out individuals into ad-based groups or cohorts. Agencies then will be able to pay to target their ads towards a particular group rather than an individual.
This change could also leave users unsatisfied in several ways because they will still feel that they are seeing too many targeted ads and their personal information is very easily accessible. But now it will be accessible only to Google and the websites the user visits instead of the third-party agencies. Marketers feel this change could have a negative financial effect.
In the long-term, this will result in other forms of digital marketing becoming even more essential for business growth. As pay-per-click advertising will lose its effectiveness, marketing agencies will shift focus on using content marketing for building a lasting brand image.
In a cookie-less world, it will be difficult for digital advertisers to offer personalised content and effectively measure the performance of their campaigns. They will have to depend on first-party data and work extra hard to assess the data available to understand their users personally. More time and efforts will go in building new customer data platform and searching similarities among different cohorts. Though marketers have been anticipating this, the industry will take some time to get used to it and figure out the best ways for using first-party data efficiently.
(Manu Gupta, AVP, Digital Success at ET Medialabs – a Digital Marketing Firm)
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