Don’t be fooled by Google’s announcement: Marketers still need to embrace a new future of advertising without cookies

Alyssa Furth

Don’t be fooled by Google’s announcement: Marketers still need to embrace a new future of advertising without cookies

Google just announced it no longer plans to deprecate third-party cookies in Chrome. If this gave you whiplash, you’re not alone. However, don’t update your data strategies and use case backlogs just yet.

With or without the deprecation of third-party cookies from Google, the trajectory toward a more privacy-centric web is secure, driven by consumer choice and regulatory pressures—and looking at recent precedents, that doesn’t bode well for the future of cookies.

This update likely won’t change the end result for the future of advertising and marketing. So for now, stay the course. Exploring durable privacy-safe advertising solutions, collecting, protecting, and maximizing (consented) first-party data, and fortifying internal data practices is still paramount for leading customer-centric organizations.

Back up: How does Google’s announcement not change our trajectory?

Cookie erosion is already here and has spurred the development of strong, privacy-enhanced alternatives for targeting, measurement, and optimization of media for advertisers and publishers alike. For the past few years, advertisers have been accounting for cookieless environments within their media strategies; this includes Firefox and Safari as well as emerging media channels such as CTV, retail media, and gaming, which are continuing to gain a larger portion of advertising budgets.

With Google’s decision, the choice is now in the hands of the consumer—and more times than not, they opt out of being tracked. According to the leading mobile marketing analytics platform Adjust, Apple App Tracking Transparency (ATT) opt-in rates in the U.S. are only 24%—one of the lowest across the globe. This means 76% of users opt not to be tracked across apps on Apple devices. So while Google may continue to support third-party cookies in Chrome, it’s likely most consumers will not. This essentially clears the path for cookie deprecation and relieves the pressure on Google from the industry and the Competition & Markets Authority (CMA).

Additionally, when it comes to privacy, there is more to consider beyond cookies.

On the tech side, Apple, Google, and other big tech companies will continue to restrict traditional identifiers, including IP addresses and mobile ad identifiers (MAIDs). In Google’s announcement on Monday, they stated they will not only continue to invest in Privacy Sandbox but also introduce IP Protection in Chrome’s Incognito mode to mask user IP addresses.

Then there are the evolving privacy laws to consider that dictate how organizations collect and use consumer data. It is more critical than ever for marketers to stay informed and stay ahead of privacy regulations. To make things more complicated, privacy laws in the U.S. vary state by state and it is unclear if we will ever achieve a federal solution.

In addition to the Google news, we recently saw two other industry-changing announcements: Oracle’s $115 million privacy settlement and the FTC’s investigation into eight firms (Mastercard, Revionics, Bloomreach, JPMorgan Chase, Task Software, PROS, Accenture, and McKinsey & Co) that advertise their use of artificial intelligence (AI) and other technologies along with historical and real-time customer information to target prices for individual consumers.

The Oracle case is particularly groundbreaking and could have substantial industry impact. As quoted in the article by CIO:

“The allegations in the complaint were that Oracle was building detailed dossiers about consumers with whom it had no first-party relationship. Rather than face a jury, Oracle agreed to a significant monetary settlement and also announced it was getting out of the business,” said James Barnes, a partner at Simmons Hanley Conroy law firm. “The big takeaway is that surveillance tech companies that lack a first-party relationship with consumers have a significant problem: no American has actually consented to having their personal information surveilled everywhere they go by a company they’ve never heard of, packaged into a commoditized dossier, and then monetized and sold without their knowledge.”

Last, but certainly not least, are the expectations and behaviors of consumers. As previously mentioned, consumers are leaning more heavily into media environments that do not leverage cookies. Beyond this, they are unwavering in their expectations for transparency and clear communication about what data is being collected and how it will be used. In the future of advertising, the onus is on advertisers, publishers, and other data/tech providers to responsibly manage consumer information and act deliberately in their methods for collection, collaboration, and activation.

So how do companies win in this landscape?

As third-party data sources and signals wane, first-party data has emerged as the cornerstone of effective digital marketing. First-party data provides a rich resource for personalization and targeting while managing regulatory compliance and risk.

Navigating consumers’ seemingly incongruous expectations for both privacy and personalization is complex and can be a fine line to walk. However, it creates a new horizon for data-driven marketing. Leveraging first-party data is essential for marketers and publishers moving forward and should be prioritized to fuel forward-thinking advertising solutions, create differentiation, and unlock net-new opportunities that create and deliver value.

Most know that’s easier said than done. To learn more about the benefits of building a first-party data strategy, how to create value that drives data sharing, and tips for building a lucrative first-party data strategy, you can listen to Credera’s Technology Tangents podcast episode: "The importance of harnessing your first-party data."

Organizations need a robust infrastructure and set of processes for data collection, storage, management, and use. This involves several key components, starting with advanced customer data platforms (CDPs) that are capable of unifying data from multiple sources. These platforms not only consolidate data but also ensure it is properly permissioned and consented, adhering to stringent data privacy regulations like Europe’s General Data Protection Regulation (GDPR) and the California Consumer Privacy Act (CCPA). According to Gartner, by 2025, 60% of business-to-consumer brands are expected to use CDPs to enhance customer experiences.

Data collaboration and the adoption of data clean room technology are also increasingly critical to overcome the challenges and limitations of using first-party data in advertising and ensuring unwavering privacy and control over data for advertisers and media owners. Data clean rooms create a basis for direct, transparent partnerships between data owners to harness the power of joint datasets while protecting data privacy and mitigating concerns of risk. Instead of indiscriminately and insecurely sharing data across the industry, organizations now have the capabilities to utilize first-party data with greater control, security, and precision, creating one-to-one data connections that generate unprecedented opportunities for insights, performance, and value creation.

In case you’re asking: No, the last four years of work were not a waste and yes, this is still a priority for your organization in the near-term.

The progress made over the past four years in anticipation of cookie deprecation has been far from wasted effort. Organizations must not interpret Google's announcement as a reason to revert to old practices. Instead, they should continue to adapt and innovate.

Privacy Sandbox is also not going away and should continue to be part of test and learn plans in the short-term. In its current form, the Privacy Sandbox APIs have gotten mixed reviews. Google’s own test results were unsurprisingly favorable; however, analyses from the IAB and Criteo both found them to fall short of industry requirements and limiting for the industry’s ability to deliver relevant, effective advertising. With this feedback and the new direction, it’s not clear if (or how) Privacy Sandbox APIs will change or what the long-terms plans are from Chrome—let alone the timing for all of this.

Despite the uncertainty, there is hope for a privacy-safe future. Over the last few years several alternatives and new privacy-enhancing solutions have been developed and tested, and the results are promising. Several case studies and tests show that these solutions outperform traditional third-party cookie advertising.

As we advise our clients through this change, the key message is to be agile, proactive, and stay the course. Continue to invest in your data privacy practices, build up your data infrastructure, develop robust first-party data strategies, and test early and often. This approach will not only ensure compliance, but also build stronger, more trusting relationships with consumers in the long run.

Looking forward

At Credera, we have tailored service offerings and expertise to help advertisers and publishers navigate the complexities of this landscape. Reach out to learn more about how we can work together to find the right privacy-centric solutions for your organization.