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As Google issues death penalty for third-party cookies, publishers and advertisers wonder what’s next

30-second summary:

  • Google announced its plans to phase out support for third-party cookies in Chrome within the next two years.
  • Additionally, new methods for countering device/browser fingerprinting will be launched later this year.
  • Google and others are fine with first-party cookies, because a visitor or customer has made a purposeful effort to visit that publisher’s site.
  • DoubleVerify’s Managing Director for EMEA Tanzil Bukhari says this move will accelerate the shift in the ad industry from user-level targeting to contextual targeting.
  • The big walled gardens, which also include Facebook and Amazon, will thrive in such an environment, he noted, because they are built on massive first-party data.

Google has been bad-mouthing third-party cookies for a while, and now it has formally announced that it intends to “render third-party cookies obsolete” within two years.

The death sentence – at least as it applies to Google’s Chrome browser – was issued in a post Tuesday on the Chromium Blog.

In that post, Chrome Engineering Director Justin Schuh pointed to the tech giant’s Privacy Sandbox initiative, launched last August.

This open source effort seeks to set up new standards that would enhance privacy on the web while still supporting publishers’ needs to direct ads at relevant audiences, although the exact paths to get there have been left vague.

The big question

Schuh indicated that Google will wait to phase out support for third-party cookies in Chrome until the Privacy Sandbox initiative results in some viable alternatives.

By the end of 2020, he said, the initiative will start trials on new approaches to measuring sales conversion and then for personalization.

Google has already announced that Chrome will start limiting “insecure cross-site tracking” next month, such as requiring that any third-party cookies be available through HTTPS.

This is intended to provide more security and browser-level cookie controls for users.

Additionally, new methods for countering device/browser fingerprinting will be launched later this year.

Fingerprinting uses the unique configuration of a user’s device and browser – OS version, browser version, specific fonts and plug-ins, and other attributes – to identify a user.

Like third-party cookies, Google and others consider fingerprinting as another violation of user privacy largely because it is involuntary.

The big pending question, of course, is what will replace third-party cookies.

Various vendors are piloting various solutions that could apply, including PubMatic, LiveRamp, the Interactive Advertising Bureau’s DigiTrust, The Trade Desk, ID5, OpenX, the Advertising ID Consortium and others.

First-party cookies are OK

Some of those are more addressed to minimizing the huge overhead of third-party cookie synching, a workaround that matches different vendors’ third-party cookies with others because only the domain dropping the cookie can read it.

Others attempt to build a shareable ID around the first-party cookie, the kind dropped by publishers for their own visitors in order to remember visitors’ interests, preferences and so on.

Google and others are fine with first-party cookies, because a visitor or customer has made a purposeful effort to visit that publisher’s site.

By contrast, third-party cookies are dropped by ad networks and others to secretly track users as they venture around the Web.

Reactions to Google’s two-year deadline from various data and advertising vendors suggest that the industry might be ready for a solution that enables advertisers to find relevant audiences while giving some measure of control to users.

But the question is what, exactly.

‘An inevitable outcome’

DoubleVerify’s Managing Director for EMEA Tanzil Bukhari, previously a Google exec, told ClickZ via email that the new deadline is “somewhat of an inevitable outcome, [which] most people were already expecting” to happen at some point.

He added that this move will accelerate the shift in the ad industry from user-level targeting to contextual targeting.

“Rather than showing you a Nike ad because you were shopping for shoes two hours ago,” he said, “you’ll get a Nike ad because you’re reading about the Olympics.”

It’s a return to traditional advertising, where advertisers show ads relevant to content, instead of following relevant users across the Web.

Chris Olson, CEO of The Media Trust, told us that “cookies are not the point,” but data collection is, adding that the “wild-west approach to data collection” is being pressured by consumers and privacy regulations. The result, he indicated, will be massive re-alignments between brands, advertisers and data providers.

Data solutions provider Lotame CMO Adam Solomon said the real question is whether Google will dominate the process, or if it will give “all good actors [equal] opportunity to leverage this tech [without] undue advantage given to Google in the process.”

Owning the data

“We shouldn’t be naïve,” cautioned Matt Keiser, CEO of email platform LiveIntent. He pointed out that Google’s site-based contextual ads network and ads on its YouTube will be unaffected by the end of third-party cookies.

The big walled gardens, which also include Facebook and Amazon, will thrive in such an environment, he noted, because they are built on massive first-party data.

Other publishers and retailers can fight back, he added, if they choose ways to share their first-party data.

But SpotX VP of Strategic Partnerships Kristen Williams said that “first-party data may not be bulletproof.”

She noted that “browsers like Firefox have already started blocking the DigiTrust cookie, even when publishers have deemed it as a first-party cookie for advertising.”

DigiTrust’s solution attempts to use first-party cookies for sharing user identity.

For brands, said PMG programmatic media director Justin Scarborough, the long-term strategy ultimately comes down to owning all, “or at least part, of their data instead of relying on external digital platforms for targeted marketing.”

“Data ownership is the only way brands will be able to develop the personalized marketing consumers desire and expect,” he added.

The post As Google issues death penalty for third-party cookies, publishers and advertisers wonder what’s next appeared first on ClickZ.

Reblogged 1 month ago from www.clickz.com

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