Plugdin Insights: What Google's cookie ban means for digital media

Read time: 7 minutes

BDO Director Dan Laird comments on why Google’s third-party cookie ban is a big deal—but not for the reasons you would expect.

Digital media and marketing professionals reacted with predictable concern in January 2020 when Google announced an end to third-party cookies on its browser, Chrome.

The cookies - small pieces of code that help marketers track customers and prospects through cyberspace - are a key part of most online campaigns, helping brands to improve their audience targeting and customisation. 

The good news is that Google’s announcement, which will affect around two-thirds of browser users, is probably not such a big deal in the end. But the important message is that it forms part of a bigger picture that is a big deal. 

Let’s start with the Google announcement first. Here there are three key points:

• Google is not getting rid of all cookies, just third-party ones. This will make life difficult for companies that rely on third parties to deliver cookies but won’t mean you will lose all sight of what’s happening on the web. Your own cookies will still work.
• The phaseout is now not happening until 2024. This gives media owners and marketers - and Google - plenty of time to work out how to live without third-party cookies. 
• Google is coming up with something that provides similar functionality to third-party cookies. It’s called Privacy Sandbox and Google says it is a privacy-preserving alternative to third-party cookies and other forms of cross-site tracking.

Clearly, what Google is proposing will not represent a fundamental shift for the online marketing, advertising and media worlds. That said, it points to deeper trends that digital marketing and media executives should be aware of.

"Google’s third-party cookie announcement is the latest in a series of moves that show the world’s biggest technology companies are concerned about personal privacy."

Businesses such as Alphabet, which owns Google, and Meta, which owns Facebook, have business models that are based on exploiting user data and are likely nervous about regulatory restrictions being placed on their activities. 

After seeing their capabilities curtailed through laws such as the European Union’s General Data Protection Regulation, it is likely they will have taken stock of how they can be seen to protect privacy with minimum impact to their operations. 

For Google, third-party cookies would have been an easy target, particularly if it can offer a proprietary tool as replacement. 

At the same time, Apple - which sells products instead of advertising data, so is aloof to the whole cookie debate - has upped the stakes by making a virtue of its privacy measures. Apple’s Safari browser blocks third-party cookies by default.

What this means is that the wealth of independent customer data that used to be available online is gradually being eroded. To reach audiences, you will increasingly have to go through the likes of Google and Facebook - or go blind. 

What can digital marketing firms do in response? There are two options, which are not mutually exclusive. The first is to rely less on data and produce more generic advertising. 

This may seem like anathema to digital-native agencies used to Excel-based campaigns. But it is what the advertising industry has done for most of its existence and still does with broadcast media such as television and radio. 

The catch is that for it to work the quality of the advertising must be high. Some might say that’s no bad thing. 

The other option is to get super niche in search of data, exploiting smaller, specialised media properties and painstakingly building data-rich mailing lists. 

This approach can benefit from the abundance of specialist interest media on the internet, from Substack bloggers to YouTube commentators. 

And it works: one of the hottest online advertising trends right now is influencer marketing, with even micro-influencers with just a few thousand followers being courted by brands. 

What both these approaches have in common is that they rely less on algorithms and more on human resources, whether it is to come up with eye-popping generic campaigns or to court trendy bloggers. 

This reliance on human factors has two knock-on implications. The first is that the war for talent that you’re already fighting is about to get fiercer. 

Increasingly, throwing money at the problem will not help, so it would pay to get imaginative about how you can retain and attract staff (pro tip: we can help). 

The second implication is that certain types of finance, such as private equity funding, might get harder to come by. 

While it is true that private equity has been increasingly attracted to the sector, with buyouts representing almost a fifth of all global media deals, investors’ favoured targets have tended to be companies that offer ad technology platforms. 

These are the kinds of companies that might struggle as data gets harder to come by. 

"That is not to say you should write off private equity financing, just consider carefully how to initiate contacts and position conversations - after all, media and marketing is still a better bet than many other sectors."

Ultimately, what counts is that you are taking the long view of events and thinking strategically about how to adapt to new market conditions. 

This is sound advice for any business at any time, although it tends to be overlooked in the fast-paced world of media and marketing. If Google’s third-party cookie ban forces you to pause and think about the future, that’s good news. 

Do you have specific questions about managed services across the TMT sector? Get in touch by emailing plugdin@bdo.co.uk.