Transitioning to a first-party data strategy is key for Australian advertisers

Sean Knight-Braniff
By Sean Knight-Braniff | 19 April 2024
Sean Knight-Braniff.

With Google publicly committed to deprecating third-party cookies in Chrome in 2024, many Australian advertisers still fail to recognise how reliant they are on these cookies to power their website and get the most bang from their marketing buck.

Leading Google Premier Partner TRKKN Analytics Account Director Sean Knight-Braniff dives into the changes set to impact every marketing team this year, why everyone is moving further forward to a privacy-safe internet, and how marketing teams can use it as an opportunity to grow their business.  

Third-party cookies have been a cornerstone of the web for almost three decades. They've underpinned a wealth of engaging online experiences, as well as help marketers ensure they deliver relevant and engaging ads to the right people at the right time.

That's all set to change, with Google declaring its dominant Chrome browser will stop supporting third-party tracking cookies in the second half of 2024. The shift has already begun, with Google rolling out Tracking Protection to 1 per cent of Chrome users globally in January, a key milestone in its push to phase out third-party cookies for everyone in the second half of the year.

The Cambridge Analytica scandal and other invasive, wide-scale data harvesting schemes have seen privacy breaches make global headlines.

Meanwhile, Europe's GDPR and other regulatory moves have also shone a light on questionable privacy practices around the world. Closer to home, a review of Australia’s Privacy Act has made a wide range of recommendations, including broader right for adults to opt out of targeted advertising.

Today, savvy consumers have a much better understanding of privacy threats and the true risks they pose. As a result, they are demanding more control over how they are tracked online and how their data is used, with an expectation that brands, and technology will do more to protect their privacy.

Deprecating third-party cookies is just one example of how Google is raising the bar on privacy. Its relatively new Privacy Sandbox initiative contains a range of features designed to protect people's privacy online while still giving businesses the tools they need to build a thriving digital presence.

Other big players in the browser market, such as Apple, have long had a strong focus on user privacy, with its Safari browser already blocking many third-party cookies via its Intelligent Tracking Prevention feature. Mozilla's anti-tracking policy has a similar approach blocking third-party cookies from known trackers.

Until now, marketers relying on third-party cookies have not been overly impacted by Apple and Mozilla's stance, considering that Chrome owns 60 per cent of Australia's desktop browser market, along with around 40 per cent of the mobile browser market.

Extrapolating from Chrome data has allowed marketers to get by for the last few years, but that's all set to change once Chrome joins the other browsers in deprecating third-party cookies.

The move is going to cause a major upheaval for Australian businesses, and those which aren't prepared for a cookieless future will be left without insights they have come to rely on. It's not just a technical issue, it's a business issue which needs to be acknowledged at the highest levels.

When it comes to website functionality, a range of critical features such as guest check out payments on ecommerce sites often rely on third-party cookies.

When it comes to digital marketing, the ability to measure post impression performance and attribute value to campaigns will be impacted. Marketers will need to consider how they continue to create relevant experiences and measure the effectiveness of these efforts.

A randomised, controlled experiment by Google in 2019 found that disabling access to cookies saw the average advertising revenue of the top 500 global publishers drop by a massive 52 per cent. The follow-on effect to marketers could be just as severe if they're not prepared for the demise of third-party cookies.

While marketers have had years to prepare, in March 2023 three-quarters of marketers still relied heavily on third-party cookies, according to an Adobe study. Almost half (45%) still spend at least half their budget on campaigns and other activations based on them. Meanwhile, 16% said the deprecation of the third-party cookie will “devastate” their business.

At this point, it becomes clear that auditing third-party cookie reliance is critical for any organisation which can't afford to suffer a similar fate. Many will be surprised to discover just how dependent they are on these cookies for key aspects of their operations.

The removal of third-party cookies also creates somewhat of a paradox: consumers expect reduced tracking and improved privacy while still demanding relevant advertising and personalised online experiences. Brands are forced to take a proactive approach to striking the right balance or risk a significant backlash.

Transitioning to a privacy-focused internet can also act as an opportunity for brands to build stronger connections with customers. Going forward, they must focus their efforts on a "first-party" data strategy which aligns the collection and application of data with business goals and customer value.

A first-party data strategy can underpin a stronger focus on advanced personalisation and customer experience. It also helps brands become data-driven organisations, breaking down silos and unlocking the full potential of their data for all stakeholders across the organisation.

Marketers who aren’t prepared may be in for a rude awakening in the second half of 2024. As Google finally call time on third-party cookies, now is the time to ensure you have a first-party data strategy that will help your business success in a privacy-first world.

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