Roundtable: How Google’s Third-Party Cookie Announcement Will Disrupt Search, Ad Tech

Google dropped a bombshell on the ad tech ecosystem Tuesday, announcing it would phase out third-party cookies for Chrome users over the next two years. Third-party cookies allow companies to track users across properties they do not personally own, enabling much of the tracking and data-driven advertising that dominates the digital economy. The decision seems poised to throw a wrench in all of ad tech.

Google indicated it is making the change to boost user privacy on the Web, and the company believes digital advertising can survive on the back of evolving, more privacy-aware data sources. Chief among those sources, at least in the case of Chrome, will be Google’s privacy sandbox, which will offer advertisers and ad tech companies personalization opportunities based on browser data without granting them direct access to user-level information.

To size up the impact of Google’s announcement on ad tech and hyperlocal marketing, we turned to a slate of industry professionals for their takes on the move.

Damian Rollison, Senior VP of Product Strategy, Brandify: Beginning of a Changing Web?

Privacy advocates are already saying it’s too little, too late, but for most of us, Google’s decision to block cookies is pretty momentous news. Of course, Google itself can still track us with our consent, mobile users can be tracked using device IDs, and fingerprinting techniques provide a very effective means for tracking both desktop and mobile users that doesn’t rely on cookies.

At the same time, I’m encouraged by Chrome head of engineering Justin Shuh’s claim that this is one move in a larger attempt to “fix the architecture of the web.” Let’s hope Google is beginning to come to terms with the reality that respect for user privacy is the only economically tenable long-term position for internet companies.

Matt Keiser, Founder and CEO, LiveIntent: Dangerous Times for Ad Tech

The approach is quite brilliant in that it appears Google will hold themselves to the same standard as the industry, however we shouldn’t be naive. For Google, Google and YouTube is where the majority of their money comes from, and first-party cookies from YouTube will be unaffected by this change.

In this new world, companies like Facebook, Amazon and Google will continue to thrive because they continue to have access to first party data. However, you know who else has access to first-party data? Anyone who drives audiences to their websites: Publishers and advertisers. If entities with audiences are smart and willing to work together with their first-party data, they’ll finally be able to mount a defense against the triopoly (Facebook, Google, and Amazon) and own their own destinies.

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. If they choose not to and don’t work together, Google, Facebook and Amazon will win. The sandbox runoff will rearrange the deck chairs that adtech providers and agencies sit on.

Adam Solomon, CMO, Lotame: Google’s Sleight of Hand?

The real question is whether Google’s actions will speak louder than its words, namely all good actors being given equal opportunity to leverage this tech similarly without undue advantage given to Google in the process.

As an independent data solutions provider, we want to work with everyone, and we do work with everyone. As long as Google is committed to open collaboration, we’re more than happy to participate and help our marketer, brand, and agency clients navigate this path.

Tanzil Bukhari, DoubleVerify’s Managing Director, EMEA, and former Googler: A Shift toward Contextual Ads

This will have a major impact on digital marketing. Whole industries within it have been built on cookies to do anything ranging from A/B tests to ad targeting. It will take significant engineering across the industry to adopt to these new changes and for companies to find alternative solutions to the same problems.

What does matter to us is that this will shift the industry from user-level targeting — which will become harder and harder as user tracking gets locked down by browsers — toward contextual targeting. Rather than showing you a Nike ad because you were shopping for shoes two hours ago, you’ll get a Nike ad because you’re reading about the Olympics. Contextual targeting is a return to traditional online ad campaigns, where reaching a consumer meant showing up on the right article or piece of content.

With that said, modern contextual targeting is more data-driven and bleeding-edge. It incorporates new technologies like AI and semantic science to ensure ads run on the right website and the right page, targeting the right audience. In a way, it’s very similar to brand suitability and brand safety targeting.

Kurt Donnell, President of Freestar: Upside for Google but not Google alone

There have been a lot of misguided attempts at privacy reform. This could be good for both Google and the industry at large. If Google is able to create the right standards and get other browsers on board with its initiative and to follow suit, Google could cement itself as the source of truth and the standard for identity solutions while potentially increasing CPMs for publishers in other browsers.

Furthermore, the (two-year) timeframe is something that was greatly needed by everyone in the industry — we’ve all been left guessing with an open-ended timeline up until this point. We all now have the same timeframe to work against to put our heads together and determine how to implement an efficient solution.

Overall, this initiative seems to strike a good balance between providing a level of targeting that advertisers need while giving consumers the heightened degree of privacy that they are pushing for albeit with Google seeing significant potential upside.

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Joe Zappa is the Managing Editor of Street Fight. He joined Street Fight as a contributing writer in 2015, has compiled the daily newsletter since 2016, and has spearheaded the newsroom's editorial operations since 2018. Shoot him an email at jzappa@streetfightmag.com.
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