As Google Chrome crumbles the third-party cookie, what's next for adtech?

The Drum 15 Jan 2020 02:40
As Google Chrome crumbles the third-party cookie, what's next for adtech?

For 25 years, third-party browser cookies have tracked the journeys of internet users. These maligned lines of code are unlikely to celebrate a 30th anniversary, however, with Google revealing plans to block them across its Chrome browser by 2022.

Given Chrome's mammoth 66% monopoly on the browser market, the move has raised big questions about the future of cross-site tracking, retargeting and ad-serving for the adtech industry.

Right now, hundreds of third parties track people every time they hit a domain. Privacy laws, including the EU's General Data Protection Regulation (GDPR) have already turned the tide against mass-surveillance and now Google will effectively crumble the third-party cookie when it rolls out its Privacy Sandbox API.

Justin Schuh, director of Chrome engineering, outlined his intent to “render third-party cookies obsolete” in an announcement on the news. This single API change is likely to alter the fabric of adtech as we know it, having ramifications for digital marketers across the globe. The tech giant will be working over the next two years to iron out some of the creases emerging from the obsolesce of the cookie.

The early indications are not encouraging for adtech companies.

Greg Paull, co-founder and principal at consultancy R3, said "retargeting focused adtech companies" such as Criteo were most likely to face instant obstacles.

However, the play from Google is far from a shot out of the blue. Browsers including Safari and Brave beat Chrome to the punch, and the industry has had time to come to terms with the fact its main source of data collection was being phased out.

Writing in AdExchanger Ari Paparo, chief executive of Beeswax said view-through attribution, third-party data, DMP and multitouch attribution will be “dead” under the proposals. We’re now facing a world with significantly less measurement and targeting.

“We may end up at a point in time with so many fragmented identifiers and methodologies that we struggle to still deploy the practice of data-driven advertising such as real-time bidding.”

There is also a feeling that Google is pulling up the ladder after itself.

“Google is building a moat. It doesn’t don’t need third-party cookies to track people. It has code live on virtually every single website and app.”

Many existing products will simply fail to work without the third-party cookie, said James Parker, chief solutions officer of data and planning at Jellyfish.

Google will continue to generate all the first-party data it needs to assure market dominance, particularly on YouTube. Matt Keiser, founder and chief executive of LiveIntent thinks the move will benefit the triopoly.

There is an opportunity for bigger publishers – think the size of WarnerMedia – to capitalise by building upon actionable profiles on loyal, engaged audiences – essentially building their own walled garden.

Keiser said: “The agencies and ad-tech providers and those who have been mastering third-party data will lose their privileged position in this new world. You used to have the power if you sat across many publishers and brands like an agency or an ad-tech provider but now: it’s the first-party data owner who chooses whether to share.”

Marketers had “false confidence” in the third-party data solutions they’ve been relying on for the last few years in his opinion, McDonald said.

"This notion that every single thing could be accounted for through a clickstream, it's kind of tempting and it's kind of acted like a drug and intoxicated many marketers that should've known better," McDonald said.

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