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What Does Google’s Announcement Mean for the Digital Advertising Industry?

Jan 22, 2020

Vanessa Gentile

Google recently announced that it will stop the use of third-party cookies. Read on to learn how this will impact you and the digital advertising industry at large.

What does Google’s announcement mean for the digital advertising industry?

Following the move by Apple and Firefox in 2017 and 2019, Google’s announcement to stop the use of third-party cookies was almost inevitable. Alongside legal changes such as the General Data Protection Regulation (GDPR) and California Consumer Privacy Act (CCPA), consumer attitudes towards data privacy are also changing. Ultimately, the ad-supported web is at risk if digital advertising practices don’t evolve.

The most salient part of the announcement is the removal of third-party cookies. Cookies are small pieces of code that websites deliver to a visitor’s browser and that stick around as the person visits other sites. They can be used to track users across multiple sites and can be used to target ads and see how they perform.  Google also announced a stop to other probabilistic tracking techniques such as Fingerprinting. 

The lower end of the marketing funnel is where the impact will be felt most. Retargeting in particular, not only relies on cookies for precise targeting, but also attribution – conversion measurement is critical for campaigns at this end of the funnel. Brand awareness and consideration campaigns, which rely on metrics such as reach, viewability, VCR and ad recall will be less impacted.

The prospect of a cookieless future is likely to cause a shift to app-based advertising. Instead of cookies, in-app advertising relies on Device IDs; IDFAs (ID for Advertisers) for Apple and AAID (Android Advertising ID) for Android. Not a bad consequence for advertisers, considering consumers spend an average of 5 hours a day on their mobile, 90% of which is spent in-app.

As for web ads, first-party data will become even more powerful than it is today.  Publishers who can find a way to better leverage their data will have an advantageous position. Third-party audience advertising will evolve towards more contextual targeting

We will all have to wait for more to be revealed about the Google Privacy Sandbox to understand the exact implications of the change. One thing’s for certain, users will gain more transparency, choice and control over their interaction with the digital advertising ecosystem. The future belongs to those that embrace this new advertising model driven by user choice.

What changes should advertisers make?

The 2-year grace period means no drastic action needs to be taken right away.  However, advertisers should take a closer look at the reliability and safety of their data. As prescribed by the ePrivacy Directive and the recent investigation by the ICO, the only legitimate data is the one consented by the user.  

Advertisers should look to work with partners who obtain user consent before collecting any data. That consent must be explicit, freely given and unequivocally traceable.

Whatever technology replaces cookies, obtaining explicit and unambiguous consent will remain paramount to building a long-lasting relationship of trust with consumers. Across the web, app and all other advertising channels.

What does the Google change mean for Ogury?

Ogury’s technology is SDK based. We do not use third-party cookies or fingerprinting so the announced changes do not affect Ogury.  Furthermore, we collect and generate only consented data, driven by user choice. We use this unique, reliable user and behavior data, to effectively engage mobile users.  

Is this a step in the right direction for the industry?

If the change succeeds in providing more transparency, choice and control to users there is no doubt it is a move in the right direction.  The internet was built on the opacity and deception that it is free. Which has never been the case. User data has been taken unknowingly and unwillingly to fund advertising to support content creation.  Any change that brings more balance to the playing field between advertisers, publishers and users can only be seen in a positive light.

The way we see it there will always be 3 types of consumers:

  1. The ones that hate ads altogether and are paranoid about any data sharing. Given the choice, they would prefer to pay to access content online without any ads or data collection.
  2. The ones that are not willing to share any data, but don’t mind receiving ads to access content for free. Even though the ads might be less relevant to them.
  3. The ones that are willing to share certain data which will help brands make ads more useful to them, as they access content for free.

Ogury Advertising Engine offers advertisers the only technological solution that engages all three types of consumers in a fair exchange based on their digital advertising preferences:

  1. Users can pay a fair price and enjoy an ad free, data collection free experience. It is simply a subscription model.
  2. Users don’t want to share any data – Ogury thrives on delivering them the most useful ads, based on their context, e.g. day or night, cold or hot weather… We call this personification.
  3. Users choose to share certain behavioral and demographic data – Ogury delivers to them highly relevant ads and recommendations. We call this personalization.

In this fair exchange, advertisers can confidently engage consumers in the way they choose to interact with the digital advertising ecosystem. They will continue to grow their business, while removing the financial, reputational and legal risks they are exposed to by the vast majority of advertising technology available today.  

If you have any questions, feel free to send them my way: sarah.jones@ogury.co

Sarah Jones, Director, Product Marketing