Google Was Always Going To Delay Third-party Cookies; But Treat It Like A Snooze Button & Not A Free Pass

4
at
4
minutes
Technical Level
July 6, 2021
Kate Dye
Product Marketing Manager
Google announced late Wednesday that it’s giving third party cookies another 2 years to live.

While Google is infamous for making announcements and delaying changes (1st party auction, ads.txt, GDPR enforcement and TCF adoption), two years is a lot longer than most expected. This delay is likely influenced by the regulatory interest and compounded by an almost complete lack of adoption. 

The Privacy Sandbox has faced headwinds over the past few months. First was when the Chrome team announced they would not be running FLOC tests in Europe implying they didn’t meet GDPR standards, which is, for a targeting and audience system that claims to be privacy-first, a bit of a non-starter. 

The next obstacle was an investigation from the Competition and Market Authority, the UK’s antitrust regulator into the privacy sandbox browser changes. The CMA finalized a separate investigation into the digital advertising market last year, therefore, they are well-positioned and knowledgeable on the market dynamics in adtech. 

With various national and state regulators watching closely, the last thing Google wants is the UK to provide a playbook for other antitrust cases. 

Again, increased regulatory interest is mostly unsurprising. Signs that British adtech companies were not ready to roll over came early in the Rearc, when the group was split on whether to challenge the Privacy Sandbox or move ahead with workarounds and alternatives.  Agency and adtech representatives from the UK were among the most vocal about resisting Google’s proposed changes, perhaps because they had the comfort of a governing body that had recently produced a market report on digital advertising, which outlined the duopoly’s impact on consumers and competition. 

Just as damaging to the initiative is adoption. Aside from a few standouts, most adtech firms are far from scaled solutions or even performance testing of FLEDGE or FLOC. We’re sure many have completed feasibility studies and testing, but even Universal IDs and 1P cookie-based approaches required a multi-year roll-out and much education with publishers and buyers alike—and those are far more familiar and functionally similar to current targeting mechanisms. 

With all that said, the last thing anyone should be doing in response to the news is breathing a sigh of relief and taking addressability initiatives off their roadmaps. If you’ve ignored addressability and identity so far, this is both the alarm and the snooze button option that you really needed. This is a delay, not a change of course. If you have invested in post-3P cookie identity, keep it up!  There are many reasons that kicking the 3P cookie habit benefits you today. 

Apple has continued to press forward on their own privacy changes. Remember iPhones? Safari? In the last few years, the amount of spend on Apple devices has decreased in lockstep with ITP updates, but the buying power and number of iPhone owners has only gone up. Spend might have moved, but people haven’t. 

Safari has been without third party cookies for years, the IDFA is gone, and Apple announced they plan to obfuscate IP addresses with Private Relay, which would completely eliminate any finger-printing or probabilistic identifiers.

Other browsers have cut off or will eliminate 3P cookies very soon. And though Chrome is a mainstay in the US, Firefox and others have a larger market share in the EU. There are huge audiences with proportionally little spend. 

And lastly, third-party cookie audiences and tracking isn’t a holy grail (and it never has been).  Talk to any buyer and they will tell you how mediocre some demographic and behavioural audiences are.  The fact that an early version of FLOCs could compete is a sign that we should be aiming for something better. 

Cohort or segment-based approaches are a path forward that respects the new privacy landscape while delivering the same outcomes for marketers.  And notably, deterministic individual-based methods still use statistics and modelling, so giving everything probabilistic and cohort a bad name is short-sighted and misguided. 

Authenticated targeting tied to UID 2.0 is precise and incredibly performant for advertisers and publishers with interesting first-party data. Cohort approaches that use federated learning and differential privacy and contextual can provide scale and effective targeting for longtail advertisers or those without a direct relationship with users. 

But the fact is there may not be a holy grail solution for identity. Building flexible solutions that can work with any one of these options is key to success beyond the cookie. 

Google announced late Wednesday that it’s giving third party cookies another 2 years to live.

While Google is infamous for making announcements and delaying changes (1st party auction, ads.txt, GDPR enforcement and TCF adoption), two years is a lot longer than most expected. This delay is likely influenced by the regulatory interest and compounded by an almost complete lack of adoption. 

The Privacy Sandbox has faced headwinds over the past few months. First was when the Chrome team announced they would not be running FLOC tests in Europe implying they didn’t meet GDPR standards, which is, for a targeting and audience system that claims to be privacy-first, a bit of a non-starter. 

The next obstacle was an investigation from the Competition and Market Authority, the UK’s antitrust regulator into the privacy sandbox browser changes. The CMA finalized a separate investigation into the digital advertising market last year, therefore, they are well-positioned and knowledgeable on the market dynamics in adtech. 

With various national and state regulators watching closely, the last thing Google wants is the UK to provide a playbook for other antitrust cases. 

Again, increased regulatory interest is mostly unsurprising. Signs that British adtech companies were not ready to roll over came early in the Rearc, when the group was split on whether to challenge the Privacy Sandbox or move ahead with workarounds and alternatives.  Agency and adtech representatives from the UK were among the most vocal about resisting Google’s proposed changes, perhaps because they had the comfort of a governing body that had recently produced a market report on digital advertising, which outlined the duopoly’s impact on consumers and competition. 

Just as damaging to the initiative is adoption. Aside from a few standouts, most adtech firms are far from scaled solutions or even performance testing of FLEDGE or FLOC. We’re sure many have completed feasibility studies and testing, but even Universal IDs and 1P cookie-based approaches required a multi-year roll-out and much education with publishers and buyers alike—and those are far more familiar and functionally similar to current targeting mechanisms. 

With all that said, the last thing anyone should be doing in response to the news is breathing a sigh of relief and taking addressability initiatives off their roadmaps. If you’ve ignored addressability and identity so far, this is both the alarm and the snooze button option that you really needed. This is a delay, not a change of course. If you have invested in post-3P cookie identity, keep it up!  There are many reasons that kicking the 3P cookie habit benefits you today. 

Apple has continued to press forward on their own privacy changes. Remember iPhones? Safari? In the last few years, the amount of spend on Apple devices has decreased in lockstep with ITP updates, but the buying power and number of iPhone owners has only gone up. Spend might have moved, but people haven’t. 

Safari has been without third party cookies for years, the IDFA is gone, and Apple announced they plan to obfuscate IP addresses with Private Relay, which would completely eliminate any finger-printing or probabilistic identifiers.

Other browsers have cut off or will eliminate 3P cookies very soon. And though Chrome is a mainstay in the US, Firefox and others have a larger market share in the EU. There are huge audiences with proportionally little spend. 

And lastly, third-party cookie audiences and tracking isn’t a holy grail (and it never has been).  Talk to any buyer and they will tell you how mediocre some demographic and behavioural audiences are.  The fact that an early version of FLOCs could compete is a sign that we should be aiming for something better. 

Cohort or segment-based approaches are a path forward that respects the new privacy landscape while delivering the same outcomes for marketers.  And notably, deterministic individual-based methods still use statistics and modelling, so giving everything probabilistic and cohort a bad name is short-sighted and misguided. 

Authenticated targeting tied to UID 2.0 is precise and incredibly performant for advertisers and publishers with interesting first-party data. Cohort approaches that use federated learning and differential privacy and contextual can provide scale and effective targeting for longtail advertisers or those without a direct relationship with users. 

But the fact is there may not be a holy grail solution for identity. Building flexible solutions that can work with any one of these options is key to success beyond the cookie. 

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About Behind Headlines: 180 Seconds in Ad Tech—

Behind Headlines: 180 Seconds in Ad Tech is a short 3-minute podcast exploring the news in the digital advertising industry. Ad tech is a fast-growing industry with many updates happening daily. As it can be hard for most to keep up with the latest news, the Sharethrough team wanted to create an audio series compiling notable mentions each week.

Google announced late Wednesday that it’s giving third party cookies another 2 years to live.

While Google is infamous for making announcements and delaying changes (1st party auction, ads.txt, GDPR enforcement and TCF adoption), two years is a lot longer than most expected. This delay is likely influenced by the regulatory interest and compounded by an almost complete lack of adoption. 

The Privacy Sandbox has faced headwinds over the past few months. First was when the Chrome team announced they would not be running FLOC tests in Europe implying they didn’t meet GDPR standards, which is, for a targeting and audience system that claims to be privacy-first, a bit of a non-starter. 

The next obstacle was an investigation from the Competition and Market Authority, the UK’s antitrust regulator into the privacy sandbox browser changes. The CMA finalized a separate investigation into the digital advertising market last year, therefore, they are well-positioned and knowledgeable on the market dynamics in adtech. 

With various national and state regulators watching closely, the last thing Google wants is the UK to provide a playbook for other antitrust cases. 

Again, increased regulatory interest is mostly unsurprising. Signs that British adtech companies were not ready to roll over came early in the Rearc, when the group was split on whether to challenge the Privacy Sandbox or move ahead with workarounds and alternatives.  Agency and adtech representatives from the UK were among the most vocal about resisting Google’s proposed changes, perhaps because they had the comfort of a governing body that had recently produced a market report on digital advertising, which outlined the duopoly’s impact on consumers and competition. 

Just as damaging to the initiative is adoption. Aside from a few standouts, most adtech firms are far from scaled solutions or even performance testing of FLEDGE or FLOC. We’re sure many have completed feasibility studies and testing, but even Universal IDs and 1P cookie-based approaches required a multi-year roll-out and much education with publishers and buyers alike—and those are far more familiar and functionally similar to current targeting mechanisms. 

With all that said, the last thing anyone should be doing in response to the news is breathing a sigh of relief and taking addressability initiatives off their roadmaps. If you’ve ignored addressability and identity so far, this is both the alarm and the snooze button option that you really needed. This is a delay, not a change of course. If you have invested in post-3P cookie identity, keep it up!  There are many reasons that kicking the 3P cookie habit benefits you today. 

Apple has continued to press forward on their own privacy changes. Remember iPhones? Safari? In the last few years, the amount of spend on Apple devices has decreased in lockstep with ITP updates, but the buying power and number of iPhone owners has only gone up. Spend might have moved, but people haven’t. 

Safari has been without third party cookies for years, the IDFA is gone, and Apple announced they plan to obfuscate IP addresses with Private Relay, which would completely eliminate any finger-printing or probabilistic identifiers.

Other browsers have cut off or will eliminate 3P cookies very soon. And though Chrome is a mainstay in the US, Firefox and others have a larger market share in the EU. There are huge audiences with proportionally little spend. 

And lastly, third-party cookie audiences and tracking isn’t a holy grail (and it never has been).  Talk to any buyer and they will tell you how mediocre some demographic and behavioural audiences are.  The fact that an early version of FLOCs could compete is a sign that we should be aiming for something better. 

Cohort or segment-based approaches are a path forward that respects the new privacy landscape while delivering the same outcomes for marketers.  And notably, deterministic individual-based methods still use statistics and modelling, so giving everything probabilistic and cohort a bad name is short-sighted and misguided. 

Authenticated targeting tied to UID 2.0 is precise and incredibly performant for advertisers and publishers with interesting first-party data. Cohort approaches that use federated learning and differential privacy and contextual can provide scale and effective targeting for longtail advertisers or those without a direct relationship with users. 

But the fact is there may not be a holy grail solution for identity. Building flexible solutions that can work with any one of these options is key to success beyond the cookie. 

About Calibrate—

Founded in 2015, Calibrate is a yearly conference for new engineering managers hosted by seasoned engineering managers. The experience level of the speakers ranges from newcomers all the way through senior engineering leaders with over twenty years of experience in the field. Each speaker is greatly concerned about the craft of engineering management. Organized and hosted by Sharethrough, it was conducted yearly in September, from 2015-2019 in San Francisco, California.

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Kate Dye
Product Marketing Manager

About the Author

Kate has spent her career in martech: from startups, to publishers, to setting new standards at the IAB techlab and building future-proof products at Sharethrough.

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