A Shift in the Ad-Tech Industry As Third-Party Cookies Crumble
In January of last year, Google announced that by 2022, they will no longer be supporting third-party cookies on the Google Chrome application. Google’s Chrome accounts for about 66% of global internet users, making it the world’s most popular browser.
This update shocked the marketing and advertising industry worldwide as online advertising has relied on this service for years. Without cookies, it will be more difficult for marketers to track the online trends and activities of billions of people.
From the users’ perspective, people are seeing it as a win for more privacy and data protection. Not having third-party cookies tracking their every step and every purchase.
Professionals within the industry say that this change could make it difficult for smaller advertising firms, as well as websites that rely on advertisements. However, this change does not eradicate targeted advertising, but rather rewriting the rules for it.
Google plans to replace third-party cookies with browser-based machine learning. With this privacy-preserving API alternative, it will use AI to log users’ browsing histories and categorize them into groups based on similar interests. Then, advertisers will be able to showcase their ads to users based on the group they are in. This method gives Chrome more control over the advertising algorithm as all of the data used to categorize individuals will be processed in Chrome. Google has begun testing its AI system called Federate Learning of Cohorts (FLoC) this month.
With this shift, it places tech powerhouses Google and Facebook at the top, as first-party data will all be withheld by them. This sends waves of uncertainty to brands and companies as their options lessen, with either having to college their own first-party data or rely on Google and Facebook to collect it for them.
Hi, my name is Melissa Chan, a current junior at Boston University studying Advertising with double minors in Business and Entrepreneurship. I currently serve as a leadership member on the Inbound Team at GMS. Feel free to connect with me on LinkedIn or reach out if you have any questions @email@example.com.