Alex Hazell, head of EMEA legal at Acxiom, discusses what the future holds for the web as we know it, as Google plans to transition away from third-party cookies
Early February 2022 saw Google’s plan to replace third-party cookies clear a major hurdle. The UK’s Competition and Markets Authority announced it had formally accepted the company’s commitments to promote competition, safeguard ad-funded options for online publishers, as well as user privacy. The formal acceptance means those commitments become legally binding.
Third-party cookies, until now, have been the backbone of online advertising. As a mechanism to unify browsing behaviour across multiple websites, they’ve powered much of the Adtech world. Adtech platforms using third-party cookies have been the primary way brands have been able to understand user behaviours, measure the performance of their campaigns, create relevant advertising audiences, and get more insight into the journeys their potential customers are making.
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The alternative that Google looks to have settled on with its Topics API works to serve adverts to users based on broad categories of interests, as opposed to the more granular way the third-party cookie operates. The initial set of topics will number around 350, and the key is that users will eventually be able to see what topics are being shared about them or disable the feature entirely – giving them more control over their data. As its Chrome browser has an almost 65% market share, this is seismic for brands, online marketers and publishers alike. Other players such as Apple’s Safari and Firefox have already discontinued third-party cookie support.
Central to this debate is what counts as ‘personal data’. While the Topics API is showing promise as a possible future solution, it still involves singling out a particular device and treating it differently using certain attributes – even if they are as generic as subjects of interest. The mission for Google will be finding a balance between capturing information that’s useful for online advertising to be effective enough to fund the free and open web as it currently stands, while at the same time empowering consumers with an awareness of what’s happening and safeguarding them. Further, perhaps unintended anti-competitive effects of the new solution need to be addressed.
A variety of parties are affected by the pivot away from third-party cookies, often with quite different interests. Advertisers are seeking the best possible returns on their investment. Publishers want to know any advertising they’re using to support their content isn’t negatively impacting user experience, but is equally relevant enough to be useful to their clients. Regulators, meanwhile, are under pressure from some quarters to do more to rein in the perceived power of big tech and the ability for companies to collect, analyse and work with consumer data. These divergences mean a compromise is inevitable.
At the same time, care needs to be taken to ensure privacy is not used as an excuse to shore up market dominance. No brand can afford to ignore the big ‘walled gardens’ of Apple, Google and Meta, but they must also work to find ways to create their own first-party data and presence, using the channels they have at their disposal. If they remain heavily reliant on the big tech players and their systems, they’ll have little or no ability to control or orientate themselves.
Any opportunity brands have to encourage users to share their preferences with an affirmative permission, they must leap on. This includes the use of first-party ‘tags’ on the brand’s content across both owned media and paid media, so marketeers can continue to understand what marketing is working and offer a differentiated consumer experience.
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Striking the right balance
Google’s Topics API is by no means the only alternative being developed to the third-party cookie. Acxiom, for example, is involved with the International Accreditation Forum (IAF), and data technology vendor Anonos in the 5th Cookie Initiative.
What should be welcomed across the whole industry is a spirit of transparency. However, Google’s commitments to work with external partners is a positive step, because the future of an ad-supported, free Internet can’t come without collaboration and compromise between Adtech players, publishers and marketers. In a world where regulators globally have a rising focus on privacy, consumer trust in the process must be built at every opportunity. Finding the right balance between privacy safeguarding, and effective personalisation, is in everyone’s interest to reach.