IAB New Zealand's Data, Privacy & Measurement Council reflects on Google's Cookie Conundrum and the recent change in course on third-party cookie deprecation.
Authors:
Emily Isle, Chief Digital Officer MBM
Lucinda Moon, Consulting Director, First Digital
Mac Wilson, Development Team Lead - Data & Ad Tech, NZME
Mira Bradshaw, Head of Data, Product & Commercial, Stuff
Qassem Naim, Founder Team Circle
Travena Addenbrooke, AI Marketing Lead, Spark NZ
Google Chrome says it is no longer getting rid of third-party cookies
After years of advocating for industry-wide action on phasing out third-party cookies, Google Chrome recently announced it has revised its approach and will not completely eliminate third-party cookies as previously planned.
Following a trend towards increased consumer privacy, Chrome announced in 2020 its plan to phase out third-party cookies, aligning with actions previously taken by browsers like Safari and Firefox. This decision prompted significant changes in the digital media ecosystem, which has heavily relied on third-party cookies for targeted advertising and user tracking.
After a series of announced deprecation deadlines and subsequent postponements, last week they revealed that they are no longer "deprecating" 3rd party cookies, but introducing a "new experience in Chrome" that allows users to make an informed choice with their web browsing; allowing them to adjust their preferences at any time.
A reminder of what cookies are
The technology behind cookies is relatively old, and they were never initially designed for the complex roles they now play in digital advertising. Originally, cookies were simple tools for managing session states on websites, for example, to ensure that items placed in a shopping cart were still in the cart when a user returned. However, as digital marketing evolved, cookies have been repurposed to gather extensive data about users' online behaviors, preferences, and identities. This repurposing has led to increased scrutiny from both users and regulators concerned about privacy.
Why has Google made this decision?
Google's decision to retain third-party cookies in Chrome comes after years of attempting to balance user privacy with the needs of the advertising industry. Feedback from regulators, publishers, web developers, and advertisers contributed to this decision.
Publishers were concerned about revenue loss and the feasibility of using Google's proposed cookie alternatives. Advertisers worried about the impact of a cookieless environment on ad measurement and effectiveness they had become accustomed to. Regulatory bodies, such as the UK’s Competition and Markets Authority (CMA) and Information Commissioner’s Office (ICO), raised concerns about potential competition distortion and privacy law violations related to Google's Privacy Sandbox.
What is the impact?
While Google’s announcement offers some relief to the advertising industry, ultimately nothing’s changed for advertisers who have begun the transition to a first-party approach given the uncertainties and potential issues that remain. We are still moving towards a future with less cross-site signal, and there will be people—perhaps many—who will not have third-party cookies if they have opted out.
If Apple’s ATT is anything to go by, less than 20% of Kiwi Chrome users are likely to opt-in, meaning the vast majority of 3rd party cookies still won’t be available. Add that to the Safari and Firefox users and you are left with a small minority of the market that are likely to be able to be targeted and tracked via 3rd party cookies.
The effectiveness of alternative targeting methods such as contextual targeting, data collaborations, and expanding and growing first-party ecosystems while continuing to assess new market solutions such as the Privacy Sandbox will be important.
NZ Regulatory Environment
While New Zealand currently lacks strict legal restrictions similar to GDPR in Europe and CCPA in the US, it can still be impacted. If, for example, your marketing reaches European audiences, you will likely have a responsibility to obtain user consent to meet those countries’ privacy standards. Always consult your legal team and privacy officer.
With privacy regulations gaining traction globally, local organisations should proactively prepare for potential regulatory changes. New Zealand has the new Privacy Amendment Bill, which has received its first reading in Parliament. The Bill proposes changes to the Privacy Act 2020, including new disclosure requirements for organisations that collect personal information from sources other than the individual concerned. The Bill is still under review.
Consent strategies are still needed
While it is still unclear how Google’s new browser privacy feature will interact with site-specific consent models, consent-based marketing remains a critical strategy. With growing awareness and concern over privacy, users are increasingly conscious of their digital footprints and the implications of their online activities. This will be a space to monitor closely as more information about the new browser privacy feature becomes available.
New Zealand's transition to robust, privacy-first strategies for online advertising and tracking hinges on adopting comprehensive frameworks like GDPR and CCPA, which prioritise user consent and transparency. This transition would involve setting up a consent management platform to capture and store user consent preferences and utilising standardised consent strings to communicate these preferences throughout the digital advertising ecosystem.
The importance of consent-based marketing continues to grow as users demand more control over their personal information and as regulations make clear the legal obligations of businesses. Organisations must navigate these challenges by ensuring transparency, securing user consent, and exploring newer technologies that respect user privacy while providing the benefits of targeted advertising.
At the end of the day
The digital media ecosystem continues to evolve as consumers become more aware, regulation matures, and new technologies are introduced.
While it was somewhat of a surprise for Google Chrome to abandon the depreciation of third-party cookies, it is unlikely to have a large impact on the trajectory the industry has been heading in that time. Publishers, agencies, and advertisers alike will continue to need to take more ownership of their approach to data, measurement, and privacy.
Google’s original announcement blog post is here.
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