In the last few weeks of December, marketers were met with an announcement that Google was finally committing to phasing out third-party cookies. As of Jan. 4, Google will roll out limits to cross-site tracking, known as “tracking protection,” to 1% of Chrome users globally — and by the second half of 2024, Google plans to roll this out to all users, subject to regulatory hurdles. It’s worth noting that for U.S.-based marketers, the regulatory challenges currently only emanate from the UK Competitions and Markets Authority (CMA).
From a practical perspective, Google’s announcement and the deprecation of third-party cookies is inevitable. In a world increasingly dominated by state-by-state privacy regulations, consent-to-track notices, consumer pushback against surveillance advertising, and companies like Apple taking a public position marketing themselves as privacy vanguards, the clock was ticking on cookies independent of any decision by Google.
The ad-tech industry also broadly recognized the inevitability, with multiple solutions in development over the past few years outside of Google’s own Privacy Sandbox product. Alternatives to Privacy Sandbox such as The Trade Desk’s Unified ID, publisher identity solutions and contextual advertising tools are well advanced and ready today. There is also active development of AI-based solutions that seek to unify all cookieless alternatives.
But what does this mean for marketers today?
A world without cookies
To put Google’s announcement in context, from Jan. 4 onward, approximately 32 million Chrome users globally will no longer support third-party cookies as they experience the internet. A little back-of-the-envelope math — drawing on data that includes the United States as a percent of the global internet population and Chrome market share — suggests that the impact in the U.S. will be between 1.4 and 2.4 million users. The delta between the ranges depends on factors including whether Google distributes the 1% randomly across geographies or factors in local market conditions.
This all said, given that Google has offered no insight into how the roll-out will be deployed, advertisers may find themselves impacted in unpredictable ways, with potentially more than 1% of their audience-based digital advertising adversely impacted.
Quad’s clients, though, will not be caught off-guard, with the Quad Advertising Solutions (QAS) agencies and data-science teams working with clients for a while on strategies to collect and activate first-party data, testing identity solutions and cookieless alternatives, and evaluating smarter and better ways for marketers to reach prospective and existing customers. Quad as a company also has invested in data capability to build a resilient data stack that will survive in a cookieless world, is future-proofed against other potential changes, and flexible enough to operate across multiple cookieless solutions and media channels.
The real source of truth
At the core of Quad’s approach to the deprecation of third-party cookies was a desire to build a privacy-compliant identity offering from a data set that is resilient and responsive to the whims of companies, including Apple and Google, that set the rules of the digital advertising market.
Quad’s analysis led us to household addresses as the one and only truly resilient data source. People can have multiple email addresses, multiple cell phone numbers and multiple devices, but they only have one place they call home. Starting from this point, Quad built out a proprietary data capability with household-level contextual insights, all of which readily maps to census-level data on household income and shopping behaviors — but also, critically, can be mapped to IAB-taxonomy for contextual advertising as well as Google Privacy Sandbox Topics.
Coupled with this, Quad’s approach was built to be channel-agnostic — household data can be activated anywhere, whether it be on the open web, social platforms, digital out-of-home, retail media networks, or in fast-growing categories such as Free Ad-Supported Streaming TV (FAST) and Ad-Supported Video on Demand (AVOD), dominated by companies such as Netflix, Hulu and Roku, and even Amazon’s recently announced shift to ad-supported Prime Video.
For marketers that do not have the benefit of working with Quad Advertising Solutions, what can they do to be prepared for the fully cookieless future scheduled for mid-2024? Beyond the obvious “time is of the essence, act now,” the immediate action marketers need to undertake is an audit of their marketing and advertising investment that is reliant on third-party cookies. This first step is critical to understand your exposure to the challenges (and opportunities) to come. Once this is understood, accelerated testing and adoption of cookieless alternatives will be key — and our Quad teams have the expertise and capability to help.
Plan for first-party data
But testing of alternatives is only part of the process. Mapping the impact of those alternatives on your entire consumer marketing experience is critical, and analyzing your audience connections plan and how your customers experience your media will help inform where you may need to adjust your channel mix or your content strategy as third-party cookies go away — all areas where Quad can help. There are some who may advocate for marketers to build out their own first-party data capability, but this strategy is less clear cut than it was 12 months ago.
First, building your own reliable and representative capability takes time, and with under six months left until the full deprecation of third-party cookies, time is not on most marketers’ side. Second, not every company and brand have a legitimate claim or reason to collect data, or for consumers to share their data with them. Further, the flood of companies that will make last-minute attempts to do the same thing may make this cost-prohibitive or result in significantly lower opt-in rates as consumers weary of constant demands for their data.
In Quad’s view, the best strategy now is to identify what data you have today, figure out what companies you work with that may already have data assets, and secure partnerships to leverage their investment in data to your advantage — all the while remaining mindful of privacy and regulatory compliance by bridging strategic, commercial and legal disciplines across your organization.
Whatever path you decide to take to prepare for the beginning of the end of cookies on Jan. 4 to their final demise mid-year, Quad has the people, expertise and capability to help make your post-third-party cookie marketing experience better.
And one final piece of advice: Don’t bet on UK regulators giving a reprieve to the mid-year deadline. Accept the loss of third-party cookies as a reality — their time is done.
Joshua Lowcock is President of Quad Media.
