For four years, the digital advertising ecosystem prepared for the demise of Google's third party cookies with stakeholders investing in alternatives to the massive data infrastructure that cookies made up over the decades of use. However, the tech giant recently took the world by surprise by announcing that it won't be deprecating the cookies anymore and will instead focus on enabling users to make informed choices about web browsing.
Now that the dust has settled from Google’s decision, some questions still remain.
While exchange4media has previously covered how the move impacts advertising brands, their digital agencies, adtech partners, and even investments in alternative technologies, given Google’s enormous reach in the country, there still remains the India question, and what this decision holds for the country.
According to Statista, “In 2023, Android held a share of 95.17 percent of the mobile operating system market in India. This was followed by Apple's iOS, a distant second, with 3.98 percent market share. Android went from just above 10 percent in 2012 to more than 60 percent within four years.” Meanwhile, when it comes to browsers in India, as of July 2024, Chrome has 89.1% market share.
According to Pulkit Narayan, Founder & CEO of DangleAds Technologies, this decision will have a profound impact on advertisers, publishers, and users in the country. “India's digital market is heavily influenced by Google's platforms, with Chrome browsers and Android operating systems holding substantial market shares. This dominance means that any changes Google makes to its platforms have far-reaching consequences.”
Narayan emphasizes that advertisers and publishers in India are significantly affected by Google's decisions, as they rely on these platforms for their operations.
Third-party cookies are essential for tracking user behavior across different websites, enabling advertisers to target ads more effectively and measure campaign performance. Google's decision to retain these cookies allows businesses to continue leveraging this data for personalized advertising and analytics.
Prashant Puri, Co-Founder and CEO, AdLift believes that this provides more time for transitioning strategies and technologies away from reliance on third-party cookies, ensuring campaign performance and measurement stability. “Advertisers will maintain access to third-party data for creating targeted ads, leading to higher engagement and conversion rates. However, privacy concerns persist, necessitating awareness of evolving privacy regulations and consumer expectations.”
In a diverse and segmented market like India, where consumer behavior varies widely, the ability to access and utilize this data is invaluable. Narayan highlights that this continuity is crucial for businesses to maintain their current practices while exploring new solutions.
Puri emphasizes the industry’s trend toward leveraging first-party data, encouraging advertisers to invest in building direct consumer relationships and enhancing data collection from owned channels. This period also offers an opportunity for further development in privacy-preserving technologies and alternative identifiers, such as Google's Privacy Sandbox initiative.
Neena Dasgupta, Founder and CEO, The Salt Inc. points out most of the investments made by adtech partners and other stakeholders were made on alternatives like first-party cookie collection which are certainly more privacy-preserving. “While Google's decision regarding third-party cookies offers some reprieve, the focus should remain on building strong first-party data strategies and exploring privacy-preserving alternatives. These investments will empower brands to deliver highly targeted experiences and future-proof their approach regardless of cookie regulations.”
Paras Mehta, Business Head – Programmatic Solutions, Interactive Avenues explains that Google's decision is influenced by pressure from regulatory bodies like the UK’s Competition and Markets Authority and the Information Commissioner’s Office. This pressure stemmed from feedback across the industry that cookie deprecation and proposed privacy-enhancing technologies could unfairly advantage Google’s advertising business.
Mehta suggests that businesses with heavy dependency on browser-based traffic and revenue may face challenges, but this change may also give rise to strategic collaborative economies. More advertisers and data providers might engage in various fronts such as data, insights, and analytics via ‘sandbox’ setups.
Indeed, the decision to retain third-party cookies could influence the competitive landscape in digital advertising. Other browsers, like Firefox and Safari, have already implemented stricter cookie policies. Narayan suggests that Google's choice could affect market dynamics and the strategies of ad tech companies operating in India, potentially giving Google an advantage.
Vivek Kumar Anand, Chief Business Officer, DViO Digital views Google's decision as a temporary relief for advertisers in India who haven't yet transitioned to first-party data strategies. He warns against complacency, as a cookieless world is inevitable.
Anand encourages businesses to adopt alternative technologies like Federated Learning of Cohorts (FLoC) and advocate for privacy-preserving mechanisms in targeted advertising. He stresses the importance of staying ahead of regulatory changes, building consumer trust, and maintaining effective advertising strategies in a privacy-conscious world.
That brings us to the Pros and Cons of retaining third-party cookies, which were agreed to by a broad consensus among the experts we spoke to
Pros:
Targeted Advertising: Allows advertisers to deliver more relevant and personalized ads.
Better Analytics and Measurement: Provides crucial data for tracking user behavior across different websites.
Revenue for Publishers: Enables better ad targeting and higher conversion rates, attracting more advertisers.
Stability in Transition: Provides more time for stakeholders to adapt to a future without third-party cookies.
Cons:
Privacy Concerns: Raises significant privacy issues, as they enable extensive tracking of users without explicit consent.
Consumer Trust: Continued use of third-party cookies can erode consumer trust as awareness about data privacy grows.
Regulatory Scrutiny: Increased scrutiny around data protection and privacy, with laws like GDPR and India's proposed Personal Data Protection Bill.
Dependency on a Single Player: Heavy reliance on Google's decisions can create an imbalance, impacting the entire digital advertising ecosystem.
In conclusion, Google's decision to retain third-party cookies provides temporary relief for the Indian digital marketing ecosystem, allowing businesses to continue their current practices while exploring new solutions. However, it also underscores the need for ongoing discussions around consumer privacy and data protection.
The Indian market must navigate these complexities while preparing for a future with alternative solutions, balancing short-term benefits with long-term strategic planning and privacy considerations. As industry experts suggest, the focus should shift towards first-party data and privacy-preserving technologies to stay ahead in a rapidly evolving digital landscape.
(With inputs by Sohini Ganguly)
