January 31, 2024 ↘︎

Google is (finally) phasing out cookies. Here’s why it matters

On January 4, 32 million randomly selected Google Chrome users had third-party cookies disabled in their web browsers.

On January 4, while many of us were still recovering from New Year celebrations, 32 million randomly selected Google Chrome users had third-party cookies disabled in their web browsers.

It wasn’t a mistake. Rather, Google had finally begun its long-talked-about phase-out of third-party cookies.

In case the billions of articles about the sunsetting of cookies have passed you by, here’s a quick explainer. Third-party cookies are pieces of data stored on your browser by websites. Cookies are used by advertisers and analytics services to track your online behaviour across different sites, allowing them to deliver targeted ads or gather information about your browsing habits.

Google’s trial of 1 per cent of users is a significant move and marks a pivotal moment in digital marketing. It’s the beginning of the end for third-party cookies, a mission that is set to be complete by the end of 2024.

It matters what Google does and the reason can be summed up in two words: market dominance.

Chrome has almost 65 per cent of the global web browser market share. In other words, more than 6 out of every 10 people use Google Chrome. By comparison, the next largest share belongs to Apple’s Safari with less than 20 per cent share.

Understanding the ramifications of this change on your advertising strategies, particularly in the context of retargeting ads, is crucial.

Let’s dissect these developments and highlight essential considerations in this evolving landscape.

How will this affect your advertising strategy?

Google’s decision underscores a clear challenge: the reliance on third-party cookies for retargeting ads is becoming increasingly untenable. Historically, cookies have been fundamental in gaining insights into user behaviour and preferences.

While this may seem daunting, it presents an opportunity to re-evaluate and refine your strategy to align with the current digital environment.

Retargeting relies on personalised customer experiences. The critical question now is, how can you maintain this personalisation without the primary tool for tracking user behaviour? The solution lies in leveraging first-party data.

The growing significance of first-party data

In a world moving away from cookies, first-party data is the new standard.

This data, collected directly from your audience or customers, is invaluable for personalised advertising in an era of increasing privacy regulations.

Consider the interactions on your website, user engagement with content, time spent on your platform, or purchase history. First-party data offers crucial insights into customer habits and preferences. It not only deepens your understanding of your audience but also drives more effective marketing strategies.

Properly analysed and interpreted, this Customer Experience (CX) data can create personalised experiences that resonate with your customers, giving you a competitive edge in a fragmented digital landscape.

As American statistician William Edwards Deming famously said, “In God we trust. All others must bring data.

While practices like retargeting will face new challenges, the shift presents opportunities, encouraging advertisers to forge closer relationships with audiences by collecting primary data directly. The potential benefits include more accurate targeting, improved ROI, and enhanced customer loyalty.

Australian Privacy Act revisions

At the same time third-party cookies are being phased out, proposed revisions to Australia’s Privacy Act could add a requirement for explicit user consent for data collection.

The emphasis on explicit consent transfers power to users, enabling them to decide who accesses their information and for what purposes. This shift in the data landscape is substantial, yet it does not spell disaster for marketers. Rather, it accentuates the need for transparency and communication with audiences, setting up a value exchange and clarifying why their data is needed and how it will be utilised for their benefit.

“Privacy is not an option, and it shouldn’t be the price we accept for just getting on the internet.” – technologist Gary Kovacs

In the realm of retargeting ads, reliance on first-party data becomes paramount. Marketers will need to focus on pay-per-click, search engine optimisation, content marketing, and other inbound tactics to attract organic traffic and collect this data independently, ensuring compliance with the new Privacy Act regulations.

Having a robust first-party data strategy is key.

Is a customer data platform (CDP) necessary?

As we navigate these changes, the question of investing in a CDP often arises.

CDPs consolidate first-party data from various sources into unified customer profiles, facilitating powerful, personalised advertising.

A CDP amalgamates customer data, aiding in understanding and interpreting customer behaviour. In an era where first-party data is crucial, a CDP could prove to be a valuable asset.

However, possessing a CDP is not just about data collection; it’s about extracting meaningful insights from the data to shape your marketing strategies.

What next?

Google’s departure from third-party cookies presents challenges but also opportunities to forge stronger, more transparent relationships with your audience, fostering trust and loyalty.

Emphasis on first-party data can lead to more personalised and impactful customer interactions, setting the stage for long-term success in digital campaigns.

Ultimately, this shift may compel you to diversify your digital advertising strategy, embrace new technologies, and reinforce established opt-in marketing tactics, potentially strengthening customer relationships.

Readiness and adaptability are key in this evolving scenario. Stay informed, monitor the latest developments, and prepare to navigate this new terrain.

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