Understanding third-party cookie deprecation and Google's Privacy Sandbox.

It’s a question every marketer is asking themselves right now, join us below as Resolution Digital's Chief Customer Officer Kate Gamble explores the background and future of digital privacy in Australia. 

Chrome has announced another push back on their deadline for ending third-party cookies, now extending to 2025. Despite the delay however, marketers are not getting complacent and continue to find ways to adapt to a privacy-first future.

From an advertising perspective, a recent User Trackability Report shows that there’s been a significant dip in trackability from 51% to 47% in just 15 months, underscoring a heavy reliance on Chrome inventory. This shift isn't just coming; it's already here and moving faster than many anticipated.

In this article, we explore in detail:

• An overview of Google's Privacy Sandbox
• The timeline of upcoming changes
• An analysis of data from Google's Privacy Sandbox
• Australia's privacy journey milestones
• The advantages and disadvantages
• The impact of third-party cookie deprecation
• Getting ahead of the curve
• Resolution Digital's privacy advisory assessment

Google Privacy Sandbox milestones over the years

• January 2020: Google announces plans to eliminate third-party cookies in Chrome by 2022, triggering industry-wide discussions.
• March 2021: Introduction of the Privacy Sandbox initiative by Google, seeking privacy-preserving advertising alternatives.
• June 2021: The deadline for cookie removal is extended to 2023 to allow more time for developing alternatives.
• November 2021: Proposal of the Privacy Budget by Google, aiming to limit user data extraction.
• January 2024: Chrome announces the implementation of tracking protection for 1% of Chrome users from Q1 2024. The testing will gradually ramp up to 100% of users from Q3 2024.
• April 2024: Google announces another extension on its deadline for the end of third-party cookies.

Australia’s journey to a safe internet

The Australian Government has proposed a significant overhaul of the Privacy Act 1988, aiming to strengthen privacy protections for individuals and enhance clarity for businesses.

The proposed changes include a complete rethink of personal information, changes to how organisations collect, disclose, and use consumer data, stronger online privacy protections, and higher penalties for non-compliance. These changes could have a transformative impact on marketing practices in Australia.

While the full details are still under development, here's a summary of the key proposed changes:

• Broadening the definition of PII will include inferred information, online identifiers, location data, and de-identified data that can be linked to further data sets to become identifiable.
• The privacy by design framework is a proactive approach to embedding privacy considerations throughout the entire lifecycle of a product, service, or technology. It emphasises building privacy safeguards into the design from the very beginning rather than adding them on as an afterthought.
• Establishing direct marketing guidelines aims to create a more balanced and ethical direct marketing landscape that protects consumer privacy, empowers individuals with control over their data, and fosters trust between businesses and consumers.
• Strengthening security and data destruction obligations requires organisations to implement reasonable security measures to protect personal information and ensure proper data disposal practices.

But what does this mean for brands and advertisers?
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• Improved privacy: Eliminating third-party cookies aligns with consumer demands for better user privacy by reducing the ability to track individual online behaviour.
• Promoting innovation: The transition encourages the development of new, privacy-focused technologies plus more company accountability to get on board with a privacy-centric internet.
• Less ad fraud: Advertisers may see decreased ad fraud and more accurate targeting, leading to a more efficient advertising ecosystem as reliance on third-party cookies diminishes.
• Scope expansion of PII definition: As advertisers and measurement technologies increase the number of data points collected about behaviour or transactions, there is a risk that this could be classed as "reasonably identifiable" information and treated as PII.
• Reduced user control: While enhancing user privacy, the shift might limit user control over their data as Google's Privacy Sandbox proposals still involve a level of centralised control over data collection and processing.

Potential outcomes
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• Shift towards first-party data: Publishers and advertisers will prioritise collecting and leveraging their first-party data, leading to stronger customer relationships and more relevant advertising.
• Boosting online privacy: If Google's implementation of privacy-focused alternatives is successful, users could see a significant improvement in their online privacy, contributing to a more transparent and secure digital landscape.
• Consolidation of Google's market power: There’s concern that Google's market dominance might grow, reducing competition and potentially exacerbating antitrust issues. This could result in a more consolidated and controlled online advertising ecosystem.

How to prepare for the Third-Party Cookie phase-out

Getting ahead of the curve

1. Audit data Sources: Begin by auditing your current data sources to understand the types of data collected through third-party cookies and identify which are essential for your business goals.
2. Develop a First-Party Data Strategy: Develop a clear strategy for collecting first-party data directly from your audience, including identifying data collection points and ensuring ethical data collection practices.
3. Utilise personalisation: Use the collected data to personalise user experiences and marketing messages, tailoring them based on the information provided by your audience.
4. Implement data governance: Establish and adhere to data governance policies that outline how data is collected, stored, and utilised, ensuring data security and regulatory compliance.
5. Invest in Customer Data Platforms (CDPs): Consider investing in a Customer Data Platform (CDP) to centralise and organise customer data, facilitating easier management and utilisation for marketing purposes.
6. Monitor and iterate: Regularly review and adjust your first-party data strategies based on performance metrics and user feedback to continually improve your approach.

Summary: 

This isn't a solo journey as transitioning from third-party cookies to a more privacy-focused advertising model calls for strategic adaptation, fostering a culture of transparency across industries, and building trust with audiences. This aligns with evolving privacy norms and opens new avenues for engaging users in a secure digital environment.

It's about building a digital world that respects privacy while connecting brands with their audience meaningfully.

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