Google has finally launched a new feature called Tracking Protection this week, which restricts third-party cookies by default, rolled out to 1% of Chrome users, roughly 30 million people globally.

By the third quarter of the year, cookies are expected to be gone in Chrome forever. The changes are among the biggest ones in the history of the $600 billion-a-year online ad industry. It has far-reaching implications for programmatic advertising, which has relied heavily on this technology.

However, industry experts and quick surveys indicate that most advertisers in India and even across the world are still not ready for the removal of third-party cookies.

Vishal Chinchankar, CEO, Madison Digital and Madison Media Alpha, estimates, “My sense is that only 10 per cent to 12 per cent of advertisers would have invested in their tech maturity curve to be future-ready.”

Nitin Naresh, Managing Director, Magnon Designory, refuses to cite specific figures but insists that a notable group of marketers has proactively readied themselves for this shift, while others are still navigating the learning and unlearning process.

Kiaos Marketing conducted a brief online survey in December 2023 on the readiness of industries for the cookie-less era, incorporating insights from senior marketers across India. Its findings are not different from what Chinchankar and other experts have to say.Over 92% of respondents in the survey rated their readiness below 6 on a scale of 10. Many marketers hope that Google will address the challenge, either by postponing the issue once more or introducing solutions that navigate privacy concerns while enabling advertisers to reach specific audiences, Sajal Gupta, CEO of Kiaos Marketing, tells e4m.

Alternative data sources 

Website owners primarily use first-party cookies to enhance user experience. Cookies remember log-in details, shopping cart items, and user preferences within a specific site.

On the other hand, third-party cookies are usually set by advertisers or data aggregators like Google. These cookies track users across multiple websites, creating a comprehensive profile of their online behaviour. Google ditching cookies is a significant disruption in the web economy because Chrome has more than 60% of browser market share.

The absence of third-party cookies means it would be challenging for advertisers to reach their intended audiences. Tracking user behaviour and preferences across websites will become tough and marketers may have to rely on less precise methods. Measurement and attribution models will break due to data being more difficult to action by channel, partner, and media type.

To adapt to the new landscape, advertisers will need to explore alternative data sources. First-party data (cookie), collected directly from their websites, will become increasingly vital. However, gathering first-party data requires tremendous efforts, such as incentivizing users to share information through forms or surveys.

Many advertisers are currently testing privacy-conscious alternatives such as universal IDs, Identity Graphs and Data Clean Rooms to effectively engage with their audiences and measure results in the long term.

“We have worked closely with all our clients and are ahead of the curve in terms of GA4 implementation, Server to Server custom audience and event migration along with CAPI integration for Meta. We have set up a DMP towards permissioned encrypted user event tracking, as well as to use 1P, 2P, and 3P data in a privacy-compliant method. We use data clean rooms to analyze multi-channel data in a privacy-first environment to understand the user behaviour- while upholding the privacy standards,” says Jyothirmayee JT, Founder and CEO of Hiveminds.

Advertisers are also investing in adtech solutions such as advanced analytics, AI, and machine learning to extract meaningful insights from consumer data for ad retargeting efforts, Shradha Agarwal, Co-Founder & CEO, Grapes, points out.

Echoing the sentiments, Naresh adds that by embracing contextual targeting, leveraging first-party data, fostering collaborations, and harnessing the power of AI, marketers can continue to deliver personalized, relevant ads to their target audiences while respecting user privacy.

Privacy Sandbox to replace cookies 

Google is not going to destroy its 30-year-old flourishing business. The tech giant is rather replacing cookies with “Privacy Sandbox” that seeks to harvest your data more privately.

Notably, both Apple's Safari and Firefox deprecated third-party cookies a couple of years ago, however, they haven’t introduced alternative tracking tools, more privacy-focused or otherwise.

“With Privacy Sandbox, Chrome browser will still track users’ online behaviour, but it will store that data on your device instead of sending it off to Google or anyone else. Chrome then sorts you into different cohorts based on age, gender, geography, preferences etc. Websites and advertising companies can ask Chrome what cohort you’re in,” an ad tech expert said.

A lot of advertising companies have jumped on board with Privacy Sandbox. However, privacy advocates are still suspicious about Chrome’s new data regime.

“The Privacy Sandbox will lead to a radical shift in programmatic auctions. The ecosystem will affect how advertisers manage frequency capping, which is how often they serve an ad to the same user; how they create audience segments for targeting; and video advertising”, IAB Tech Lab, the global digital advertising technical standards-setting body, said recently.

Several ad tech firms have proposed a gradual progression for cookie deprecation in Chrome, suggesting it ramps up to 10%, 20%, 50%, and eventually 100% throughout the year. In contrast, Google has currently announced a shutdown of only 1% cookies, with plans to reach 100% in the second half of the year.

There is scepticism regarding the impact of the initial 1%, with opinions varying.

“A significant portion of the web (40%) has already blocked third-party cookies in Safari and Firefox, yet this hasn't led to substantial adoption of third-party cookieless solutions by brands and agencies. How does Google's 1% contribution bring any significant change?” a digital marketing expert quips.

At consumer end, there should be more awareness about opt-out and cookie consent, which will prevent publishers and third-party data platforms from building an "all-but-in-name" replacement to cookie-tracking, Jyothirmayee noted.