Google is Killing Third-Party Cookies. Here’s What it Means for Marketers

min read
Google is Killing Third-Party Cookies. Here’s What it Means for Marketers

Google has officially made Privacy Sandbox — which will create a privacy-friendly alternative to third-party cookies — generally available to developers in Chrome. The big news for marketers is that Google will phase out third-party cookies for 1% of Chrome and Android users in Q1 2024 with full deprecation scheduled for the second half of the year. This is the official death of third-party cookies as Safari and Firefox already have them blocked by default. What does the end of third-party cookies mean for marketers and those who use call tracking software like Invoca? 

What is Google Privacy Sandbox?

Let’s start with what Google Privacy Sandbox is and how it replaces third-party cookies — or not. First, Privacy Sandbox is not a tool in and of itself that will replace third-party cookies. It’s an open-source initiative that will bear a set of technologies that create a privacy-friendly replacement for cookies. 

These solutions will collect web and app user interest data for better ad targeting while minimizing identifiable user data collection. The goal is to balance the need for consumer privacy and the need for publishers and advertisers to deliver the most relevant ads to the right audiences. 

Privacy Sandbox APIs will eliminate most cross-site tracking, user fingerprinting, and other covert tracking methods and give users more control over what data they share with advertisers. The APIs that will enable the deprecation of third-party cookies and allow advertisers and publishers to target more relevant audiences are still in development, and you can keep up with the latest release timeline here

Is Privacy Sandbox Better or Worse for Marketers and Advertisers?

Will the outputs of Privacy Sandbox prevent major disruption to marketers, advertisers, and publishers? Given that Google’s end game is to continue growing its ad revenue, it’s unlikely that you’ll lose any of the advertising and audience targeting capabilities you’re used to, and the tools Google provides to replace third-party cookies will probably be as if not more effective. If the experience with GA4 is any indication, there may be some loss of granular user-level data, but that’s well offset with AI-powered measurement and optimization methods that are superior to what’s currently available.

Here are the goals of the Privacy Sandbox proposals and how they can impact marketers:

Showing more relevant content and ads

Raise your hand if you never want to see another irrelevant ad. Okay, that’s everyone. Now raise your hand again if you want to serve the most relevant ads possible to your audiences. Okay, that’s everyone again. The Privacy Sandbox solution for ad targeting is now Topics API, which creates recognizable categories that the browser infers based on the pages users visit. With Topics, the specific sites a user visited are no longer shared across the web, like they might have been with third-party cookies. 

How does Topics API work? First, the API labels each website from a set of recognizable, high-level topics. For example, the browser would match a sports website with the topic "Sports". Then, the browser collects a few of the most frequent topics associated with the websites a user visited. These topics are then shared with the sites they visit to help advertisers show more relevant ads, without needing to know the specific sites users have visited.

Topics API supersedes the FLoC API, which was tabled after being universally panned by privacy advocates for not doing enough to prevent covert tracking and regulators in Europe signaled that it may not comply with the GDPR. 

Fighting fraud and spam on the web

For online advertising to work for marketers, they have to know that users are who they say they are. The web is rife with bots and malicious third parties that use click fraud and other methods that inflate advertiser, ad provider, and content delivery networks (CDN) costs. 

Privacy Sandbox aims to solve this with Private State Token API, which enables a website to issue cryptographic tokens to a user it trusts, which can later be used elsewhere. This allows the trust of a user on one website (such as a social media site or email service) to be conveyed to another website (such as a publisher or online store) without identifying the user or linking identities across sites.

This is important to advertisers and publishers because bots can mess up your reporting and make it look like ads are performing that actually aren’t. State Tokens could reduce fake traffic and take a tool away from bad actors that use click bots to produce fake clicks on digital ads. Fake clicks cost advertisers money and return zero revenue, so cracking down on ad fraud benefits us all.

Enabling ad measurement while preventing user identification

One of the big fears marketers have about the death of third-party data and the move to more privacy-friendly ad tech is that it will make ad measurement less detailed and accurate. This is because many marketers once relied on third-party cookies to gather data about a person’s browsing activity and how they respond to ads. 

Privacy Sandbox aims to solve this problem with the Attribution Reporting API. Google says it will allow advertisers to place relevant ads and analyze their effectiveness in a privacy-friendly way, and replace third-party cookies with new measurement and reporting tools that prevent cross-site user tracking. 

Reducing cross-site and covert tracking

One of the primary aims of Privacy Sandbox is to reduce cross-site and covert tracking to improve user privacy controls. There are several different technologies at work to solve this problem and also ensure you can still provide the best website experience possible. 

There are many instances where cross-site tracking between related websites is required to provide the expected user experience. This includes credential management, related sites with different domain names that load resources like videos or perform other activities across domains, and embedded services such as chat widgets or embedded maps that need to know about user activity on the given site to work properly. 

You can learn more about these in The Privacy Sandbox Proposals section here.

It’s worth noting that some of the Privacy Sandbox APIs are still in the trial stages and are scheduled for general availability in the second half of 2024. You can check on the release timeline progress here

What the Loss of Third-Party Cookies Means to Marketers

At this point, probably not a lot. Most advertisers and publishers are well aware of the upcoming changes and have modified their strategies accordingly. The biggest impact will likely be felt in programmatic advertising because programmatic used to rely almost entirely on third-party cookies as the foundation for user-level targeting and measurement. Without cookies (or Google’s Privacy Sandbox alternatives) marketers can’t target users with highly relevant ads or determine whether those ads lead to sales. 

Of course, the next generation of interest-based ad targeting is hitting the streets with the deprecation of third-party cookies in Chrome and Android, so I would not expect this to cause the ad world to crumble. However, it may be a shock to an already struggling media industry if their main source of income (digital ads) is disturbed, though that appears to be more of a remote possibility than it was two years ago.

The biggest impact for marketers is keeping up with all the changes and shifting timelines associated with Privacy Sandbox and cookie deprecation. Google has pushed out the timelines at least a half dozen times, but it looks like they are now committed to the 2H 2024 timeline for cookie deprecation and settled on Topics API to target ad audiences and Protected Audience API to enable retargeting without cross-site tracking or third-party cookies. 

Will things change again? Google being Google, almost certainly, but this is a world that marketers are already used to living in.

Why the End of Third-Party Cookies Makes First-Party Customer Data Even More Important

Instead of relying on cookies and looking to third parties to inform their audience targeting, marketers must make a concerted shift to utilize their first-party data. 

First-party data contains rich insights about your already-existing prospects and customers that you can use to personalize consumer experiences and drive more revenue from every dollar you spend. Additionally, it provides a competitive advantage since you maintain exclusive access to it. Companies often have swaths of untapped first-party data at their disposal, including subscription data, CRM data, purchase data, app data, and data from phone calls to their call centers and locations. But advances in martech AI are helping them turn this data into actionable insights to improve performance and results.

One of the best methods of collecting first-party customer data is using conversation intelligence to analyze calls and share data with the rest of your martech stack to take action on it. You can learn more about how to use first-party caller data to improve audience targeting without cookies here

How the End of Third-Party Cookies Impacts Invoca Call Tracking Users

The elephant in the room for call tracking and conversation intelligence users: does the end of third-party cookies change how call tracking works? The long and short of it: no, not at all. The long-awaited deprecation of third-party cookies does not impact Invoca’s call tracking functionality. The platform never relied on third-party cookies in any way. 

The good news is that if you already use Invoca, you’re way ahead of the game when it comes to utilizing first-party customer data to optimize your marketing, target more relevant audiences, and drive more revenue from every ad and campaign. You can also use this first-party data to feed Google Ads AI tools like Performance Max, Target ROAS optimization, broad match keywords, and Smart Bidding to optimize your ads for conversions. Good on ya! 

Check out the resources below to learn more about how marketers can use first-party data or schedule a personalized consultation with our conversation intelligence AI experts.

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