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50% of UK advertising companies unprepared for third-party cookie ban

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50% of UK advertising companies and their clients currently have no plans to prepare for the looming ban on third-party cookies in 2023, even though it will cut off access to data that fuels personalisation and optimises interactions with consumers, according to new research by online behavioural personalisation and artificial intelligence platform Fanplayr.

Nearly two-thirds (60%) of all respondents in the study of 252 UK advertising decision-makers admit they still rely on third-party cookies for targeting of their advertising and marketing, revealing how significant the change will be. This reliance increases to 90% among companies with annual turnover between £100 million and £500 million. Yet four-in-ten (40%) of those polled admit the extinction of third-party cookies will decrease their own, or their clients’ revenues from advertising.

In addition, more than four-in-ten (45%) see the ban impairing their ability to achieve advertising personalisation. This is a trend that rises in relation to turnover. 80% of respondents working for organisations turning over more than £500 million agree the ban will have a negative effect on advertising personalisation.

“There is no room for complacency or reason for inaction among advertisers, even though Google’s third-party cookie-ban has been postponed to 2023,” says Andy McNab, VP EMEA at Fanplayr. “This is the biggest change to affect online advertising in many years and requires a major rethink by agencies and their clients.”

Among respondents who have taken steps to prepare for the ban (or whose clients have done so), the largest percentage (44%) have opted to implement a long-term solution using brands’ own “first-party” cookies to monitor and learn from the behaviour of visitors to their or clients’ websites. More than a third (36%), however, have opted for temporary first-party cookie solutions or are building their own in-house solutions to provide data on consumer web behaviour. The same percentage are looking at new approaches to SEO as the route to greater insight and impact, while 35% are increasing their initiatives in algorithm-driven contextual advertising.

Moves to ban third-party cookies follow the increase in privacy concerns following the EU’s GDPR (General Data Protection Regulation) and the CCPA (California Consumer Privacy Act) in California. Apple and Firefox have already acted, but since Google has more than 60% of the browser market, its decision is highly significant.

The decision by Google to put back implementation of its ban from next year (2022) to 2023 may explain the lack of action by some organisations. Nearly a third of all respondents (31%) said the postponement has caused them to delay implementation of alternative solutions, although the figure is higher (57%) among organisations with turnover of more than £50 million.

More than half of all respondents (54%) however, agree that the cookie ban is an opportunity to change their digital advertising strategy. Yet only 23% of advertising decision-makers regard the end of third-party cookies or the introduction of privacy regulation as the biggest challenge they currently face. Nearly three-in-ten (29%) are more concerned about increased digital competition and 23% say the biggest threat is from reduced spending.

“Advertisers must embrace innovation such as AI-driven first-party cookie technology that offers comprehensive alternatives, increasing revenues for advertising agencies by expanding the insight and value they deliver for their clients on a day-to-day basis. This level of innovation enables advertising agencies and their enterprise clients to segment consumers more effectively and profitably without infringing privacy regulation or falling foul of cookie bans,” adds McNab, VP EMEA at Fanplayr.

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