Six takeouts for marketers following Google’s privacy announcement
Google’s recent announcement about its move to a ‘privacy-first web’ is a big moment in the history of digital marketing. It highlights that the end really is nigh for third-party cookies, and specifically being able to target individual users based on their browsing behavior – the mainstay of digital marketing for many years.
55 London on how marketers can prepare as Google ends third-party cookies
However, despite some slightly hyperbolic headlines about ‘the end of targeting and measurement’, it will still be possible to offer relevant, personalized advertising. While doing nothing in response is not an option, the good news is there is time for marketers to get ready for a more anonymized future. But we need to separate the fact from the fiction.
1) Measurement will be less impacted
Firstly, measurement of ad campaigns will be far less impacted by the proposed changes than activation. This is due to its primary reliance on first-party cookies. Therefore core analytics capabilities ranging from click-through measurement to data import for CRM ingestion will remain as they do now. This is because they weren’t reliant on third-party metrics.
So all business as usual? Not entirely. There will be impacts on areas like view-through measurement, multi-touch attribution analysis and insights about the audience, for example demographic or affinity audiences.
2) Activation will be more difficult
The activation side will now need to become markedly different. Third-party cookies have been the bedrock of audience targeting for prospecting or retargeting. For the past decade or so marketers have relied on being able to match users to the relevant segments as they browse the internet and drop cookies on sites they visit.
So impossible now? Well, not quite. Retargeting within Walled Gardens (including Google Search, Facebook and Amazon) will be less impacted here due to their primary reliance on first-party cookies, while across other inventory sources like Programmatic Display there’ll be a shift towards more aggregated audience targeting. This could come in the form of contextual targeting (such as reaching sports fans by advertising on skysports.com), or through cohort-based audience segmentation that isn’t at the individual user level and does not rely on third-party cookies – which is where Google’s Privacy Sandbox comes in.
3) Why Floc and Fledge should be in your dictionary
In Google’s recent blog post, they reiterated their commitment towards the Privacy Sandbox. This is their primary solution for enabling targeting and measurement activations in a post-cookie world. The Privacy Sandbox covers many different areas and it is certainly worth spending the time getting to grips with this, or working with the right experts who do.
Floc and Fledge may sound like an eighties hip hop outfit, but actually refer to Federated Cohorts of Learning and First Locally-Executed Decision over Groups Experiment. Floc is Google’s replacement plan for affinity/in-market audience targeting where Chrome will locally build an ad interest profile for you. Google will keep the data local to the browser itself with users being grouped into cohorts of similar interests, which can then be targeted by advertisers whilst retaining user privacy. Meanwhile, Fledge focuses on enabling programmatic retargeting at non-user level where interactions with brand sites are stored within the browser, with the auctions for these segments occurring within a trusted server framework to manage the transaction between SSPs and DSPs.
4) Media targeting must be done at an aggregate, not user level
The Privacy Sandbox has still not been fully defined, but the direction of travel is to enable media targeting at an aggregate rather than a user level. Google’s big move is going towards clustering groups of users based on similar behaviors and signals, based on algorithmic models. This forms the basis of audience segmentation for prospecting and retargeting purposes.
So surely this is less effective? While it will always be less robust than user-level cookies, initial tests have shown that these new methods are 95% as effective as traditional cookie-based advertising. So, the outlook is certainly less gloomy than the ‘death of personalized targeting’ headlines may point towards.
5) Google isn’t the only player in town
While Google is perhaps more advanced in its tech solutions, hence its confident move outlined in the blog, others are also trying to come up with a solution for a more privacy-focused web. Various initiatives are worth investigating, including the Unified ID Solution 2.0, LiveIntent and ID5. Each differs in methodology, but has a broadly similar approach. This is primarily around pooling together user data across various vendors, ranging from email addresses, subscriber details, phone numbers and creating a new anonymized user-level identifier. This can be used to track and target users on the internet instead.
Despite seemingly offering a good alternative to the big tech companies, there are limitations that need to be highlighted. Key to this is scale, as you can only do this for users you can identify. Therefore it’s only really a practical option for brands with a high media spend. For them, the lack of complete digital coverage is less significant. A more fundamental issue relates to the access these IDs are granted. They will be entirely reliant on the continued cooperation of partners, who will also be competitors. If they don’t get buy in they will effectively be redundant. In fact, Google has already stated that it will not allow them to be used within any of their platforms.
6) You have time to adjust
While there is a lot to take on board, the good news is there is at least time to adjust to the new reality. There isn’t an exact date for Chrome updates around third-party cookies to be rolled out (the current position is sometime in 2022). Additionally, Google almost certainly will not roll this out before it has fully defined its Privacy Sandbox solution and practical applications. The blog post makes it clear their goal and intention is to allow digital marketers to enable largely the same activations in the post-cookie world that exist today. A smart strategy would be to take the time to understand how your approach to this may be slightly different, and to continue to focus on areas that will continue to be crucial moving into next year, such as a robust testing and measurement frameworks, and a clearly defined strategy to link your creative and audience activations.
Digital marketing has always been a dynamic, rapidly-changing industry defined by new trends. Although significant, this is merely the latest iteration. As with previous changes, it is incumbent to stay on top of the changes to be able to provide relevant, timely and targeted advertising. The truth about targeting in the future is probably best summed up by Mark Twain: “Reports of my death have been greatly exaggerated.”