Google will fully phase out third-party cookies for 100% of users midway through 2024. But what cookieless alternatives will take their place? That’s precisely the question the ad tech industry is grappling with now.
The cookieless future is fast approaching. As of Q3 2023, Privacy Sandbox APIs — including Google Topics’ API — reached GA, or the general availability stage, making it available to 99% of users. Google is also slated to push experimental labels for developers to simulate third-party cookie deprecation by the end of Q4 2023.
With 91.85% of search engine market share, Google’s axing of cookies represents a significant milestone for user privacy. But how will it impact advertiser targeting and user experience? And how well does Google Topics fare as an alternative?
Table of Contents
- Google Topics as a Cookieless Advertising Alternative
- How Google Topics Works
- How Google Topics Will Affect the Digital Media Industry
- Advertisers and Brands in a Post-Cookie World
- How To Be Ready for Third-Party Cookie Deprecation
- Navigating the New Cookieless Normal with Confidence
Google Topics as a Cookieless Advertising Alternative
Google Topics is a cookieless alternative with a broader approach to interest-based advertising. It’s one of many Google proposals in its Privacy Sandbox, hoping to fill the void left by the deprecation of third-party cookies amid a renewed focus on user data privacy and protection. It gives advertisers a way to deliver ads without identifying who their audiences specifically are.
The Google Topics API allows audience targeting to exist in a more privacy-safe world. Consumers see relevant ads without having to share who they are or the sites they’ve visited. Relevancy is determined based on data from app usage or web browsing. The Topics API privacy measures for consumers include data noising, data reduction, on-device data processing and sensitive topic exclusion.
Initially, Google based the Topics API on 350 of the many topics the Interactive Advertising Bureau (IAB) uses. In a technical post on GitHub, Google shared it will add thousands of new topics over time.
The topic selection will exclude sensitive subjects. Google will work with an external party that gets feedback from across the industry to help determine which topics to include.
According to Google, the Topics API is a transparent tracking mechanism. Consumers will be able to see the information being shared about them, and it will be generic enough that it shouldn’t raise concerns like some of the details third-party cookies attribute to an individual. However, Topics alone will not alleviate consumers’ concerns about ad frequency in terms of being inundated with the same messaging.
Google isn’t trying to create one single API that will solve all problems regarding the consumer experience. Instead, that will come from the combination of Privacy Sandbox proposals and how well they work together.
While this doesn’t make things easier, it’ll offer better privacy and infrastructure. As a result, consumers will enjoy more control than they do today. Combining Topics with other Sandbox APIs including the Protected Audience API and the Attribution Reporting API will give us a better assessment of what the consumer experience will look like.
How Google Topics Works
Google Topics relies on gauging consumer interests and then sharing them with advertisers. Instead of the browser keeping track of every user activity, Google Topics uses information from the search engine to create a profile of an individual’s interests. Here’s how this goes.
1. Topic Labels Are Assigned
Participating websites are assigned a topic label from a Google Topics list, which initially includes 350 personal interest topics (excluding sensitive categories such as race, gender, religion, etc.).
2. Browsers Determine Top Weekly Interests
Using your device’s browser history, your browser determines your top interests for the week based on the Topics list and stores this information on your device for three weeks before deleting it. Topics are chosen based on your device without interference from Google or external servers. For instance, your topics for the week may be ”travel,” ”flight bookings” and ”honeymoon planning.”
3. Three Topics Are Shared With Advertisers
When you visit a participating site, Topics selects your top three topics — one from each of the last three weeks based on the most frequent topics from all the websites you’ve visited — to share with the site and its advertisers. As a result, advertisers can better target their ads to you based on the topics you’re interested in.
How Google Topics Will Affect the Digital Media Industry
Independent ad tech is the most impacted. Will buyers and publishers have to reassess their role in their buying practice and the value proposition they bring with or without signals? It seems so. But this isn’t predominantly due to Google Topics. Instead, it’s because of third-party cookie deprecation across the board.
From the buy side, Google Topics will introduce a new set of signals, standards and inventory to consider. It’s an opportunity for buyers to expand their reach and refine user interactions.
On the other hand, publishers need to recognize that Google Topics is an additional layer of complexity when optimizing different types of campaigns. For now, most of the programmatic ecosystem is built around contextual targeting.
Ad tech experts believe that finding an all-satisfying solution that works for regulators, privacy advocates, consumers and publishers will be a significant challenge. So, publishers can expect to see more changes as the ecosystem evolves.
Important Publisher Considerations for Google Topics
It’s important to unpack two publisher lenses on this. One is a long-tail publisher lens, and the other is a top-tier one. Both are quite different. Long-tail publishers are more likely to adopt a Topics-like API.
But top publishers will need to see Topics and other APIs come together to assess its value proposition. One standalone API is potentially not going to pass muster.
Top publishers can pull their weight for direct buys. They have relationships with leading brands, can curate their segments and may have a more addressable market. Yet, not every publisher has the resources to provide these capabilities.
The question becomes: Where can this alternative appease all industry players to get scalability? Time will tell.
Advertisers and Brands in a Post-Cookie World
With third-party cookies gone, advertisers will unlikely have the ad tech collaboration and alignment to take a unified cookieless alternative approach or stance, especially across browsers. Ultimately, marketers will have to navigate a world where advertising will differ depending on where you are, how you market, and how you target and measure.
Marketers have Safari and Apple with their app software developer kit (SDK) and Google with Chrome’s APIs in the Privacy Sandbox. Then, individual browsers may build something similar to Google tools and take their approach or another creative path. Advertisers and brands must choose from various alternatives to strike a successful way forward. It’s not a one-size-fits-all situation.
There will be an addressable market, although a smaller but valuable one. Alternatively, a large, less addressable market will rely on third-party signals for value. That value will need to be reinvented with new cookieless advertising alternatives, such as The Trade Desk’s Unified ID 2.0 and Goodway Group’s Passport One™.
The landscape is now one where advertising mediums lack the same level of assumed measurement marketers have previously enjoyed in digital. In that sense, it’s important to trust media partners. Digital promises better-measured returns, but the shift to a cookieless world requires everyone to reconsider what those returns look like.
Targeting is less the leading measure. Measurement and attribution will determine what approaches and alternative solutions are or aren’t effective. Advertisers and publishers can do this through incrementality effectiveness studies and by connecting media spending to revenue outcomes. They will have to add informative or directional approaches to great addressable measurement solutions with a one-to-one measurement.
It’s going to be a combination of art and science. From the advertising and brand side, prioritizing measurement and attribution will show teams directionally how to target.
How To Be Ready for Third-Party Cookie Deprecation
With advertiser impact from Google Privacy Sandbox imminent, how can you prepare for third-party cookie deprecation? What changes should you make to ensure your digital advertising efforts remain effective?
5 Steps Advertisers and Brands Can Take Now
Here’s a general approach advertisers can take in a post-cookie world.
1. Examine Your Reporting Foundation
Ensure your reporting foundation is intact to provide clear benchmarks with these new targeting solutions. Account for seasonal trends and external factors to prepare for a post-cookie world.
This means understanding the entire customer journey, from initial ad impression to post-conversion. A comprehensive reporting platform will help you measure the effectiveness of your campaigns across all channels and devices. You must know where your conversions are coming from and which channels are the most effective.
2. Understand Available Targeting Topics
Understand the 350 topic labels available that will be used for targeting and how they map to your customer personas, attributes, and consumer journey.
For instance, if you’re targeting a specific consumer demographic, understand which topics relate to their interests and behaviors. Is there a similarity between the topics all middle-aged women from mid-income households engage with? These are the kinds of questions you should be asking and researching.
The Google ad topics will increase in number in the future, reaching the hundreds or thousands. Stay up-to-date with the latest developments and how they impact your campaigns.
3. Test Proven Targeting Solutions
Test proven targeting solutions, especially contextual. Google has published some results from interest-based targeting relying on privacy-first signals. There are also encouraging signs that AI-led optimization solutions, such as optimized targeting, are suffering less impact from the removal of third-party cookies.
In other words, get in the Sandbox. Test Topics and other solutions now to see how they compare with other targeting solutions you’ve used in the past.
4. Partner With Publishers
Consider testing publisher-direct deals now and gaining access to publishers’ research based on content and core users’ demographics. Furthermore, understand the granularity in placement.
The great thing about partnering with a publisher is that they can give you important insights into your audience’s interests. For example, you can learn which formats your audience relates to. Do they prefer video over text? Maybe they engage more with longer-form content.
It’s a mutually beneficial relationship. As a brand, you must focus on getting your share of the visibility and reach.
5. Expand Your Media Horizons
Think about testing or expanding into advertising mediums such as connected TV (CTV), which doesn’t rely on cookies or traditional web-based targeting tactics. Other options include using first-party data, universal ID solutions, contextual advertising and local advertising.
Navigating the New Cookieless Normal with Confidence
No matter how cookieless advertising shapes up, advertisers should feel confident the ad tech industry will adapt and reinvent as it always has. The advertising industry will build solid methodology and figure out how to adjust to the new normal. But that will take some time and expert assistance.
Looking to prepare for the future of identity to ensure your targeting and measurement strategies are strong? Contact us for a free assessment.
Or want some more information about discovering solutions for a post-cookie landscape?
- Visit our identity hub to view our latest whitepapers, blogs and more.
- Get answers to your burning questions about cookie deprecation.
- Catch up on what to focus on for your cookieless future.
Alex Bloore is the VP of product and data at Goodway Group. He has 13+ years of experience in software and product leadership in many industries from medical software to PropTech to adtech and marketing. As a subject matter expert for data clean rooms and identity solutions, Alex has presented at various events including Programmatic I/O and been featured in publications such as AdExchanger. An executive leader of award-winning cross-functional product and data teams, he’s driven strategic technical innovation across Goodway Group’s diverse client base. Alex currently lives in Austin, Texas, with his wife and three sons.
Jason Lett is a solutions architect at Goodway Group, where he is dedicated to the advancement of digital marketing through the development and adoption of operational standards, thought leadership and innovation. His penchant for process and execution details — as well as his vast digital experience — amplifies his ability to help a wide variety of clients and brands maximize the impact of cross-platform marketing and advertising solutions. He currently lives in Athens, Georgia, with his husband.