Decline In Ad Inventory Expected From Google’s Cookie-Free Shift

Decline In Ad Inventory Expected From Google’s Cookie-Free Shift

by  @lauriesullivan, February 21, 2020

Decline In Ad Inventory Expected From Google's Cookie-Free Shift | DeviceDaily.com

There will be positive and negative impacts from Google’s decision to end support for third-party cookies in the Chrome browser, especially in videos — not only for Google, but also for publishers and advertisers, says Sunil Karkera, global head of TCS Interactive, a business unit of Tata Consultancy Services focused on marketing and advertising.

In the short term, advertisers will see a decline in ad inventory, Karkera said, but in the long term the change is positive because they will have an audience to target.

The move will also slow the adoption of ad blocking. In parts of North America and Europe, ad blocking has been reduced, especially on desktop.

Cookie tracking in browsers slows content and creates too much noise — “noise that creates distractions in browsers when trying to view videos,” Karkera said. “The ad may only run for 15 seconds, but it takes away the focus.”

Google came to this realization five years ago. Now Chrome has become more important for the company, Karkera said. For the first time last quarter, Google disclosed that YouTube generated about $15 billion last year — to prove their business model. 

“They are making more of an effort to tell investors and marketers their business is okay,” Karkera said. 

Karkera cites a recent phone call with a product manager with Chrome at Google, in which the two spoke about contextual ads injected into the video content.

Cookie deletion in Chrome will come to pass in two years, he said. Blocking interstitial ads will remain part of the strategy until Google and others find a way to innovate around it.

This is a positive move for consumers because they will consume content with less distraction and marketers will begin to rely less on first-party and third-party tracking, he said. It will also reduce data and privacy leaks. 

“Third-party cookies are the ID bridge that connects 1st party data with visitor data on desktop,” said Charmagne Jacobs, VP head of global marketing at Adslot, an advertising technology company that automates the trading of guaranteed placement of ads. “Mobile uses a user ID, and that’s what the industry’s trying to work out. Without the cookie to connect the data, what will be the new universal ID solution?”

Microsoft also now runs on Chromium, created by Google for the Chrome browser. Google open-sourced the project, allowing companies like Microsoft to build on the technology.

Karkera said Microsoft is trying to “double down” and “one-up” Google and Apple. They are trying to innovate on privacy and expand the reach on every platform and use their cloud as the powerhouse.

“It doesn’t seem like Microsoft thinks Google’s engineers are innovating on the speed of the browser,” he said. “Microsoft has taken JavaScript engine called V8 to make it run much faster.”

MediaPost.com: Search Marketing Daily

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