Google-parent Alphabet has rethought its plans to phase out third party cookies on its Chrome web browser, potentially creating an opportunity for agencies such as Dianomi (DNM:AIM), S4 Capital (SFOR) and Future (FUTR).
The online search and advertising platform had said in January 2020 that it would overhaul Chrome by removing cookies that follow people around the web within two years, but it has now scrapped its Federated Learning of Cohorts process, a key part of its plan, and replace it with a new system called Topics.
Google assigns a maximum of five topics which it believes the user will be interested in each week. Given there are a limited number of topics, it is much more difficult to identify a user, possibly creating a larger opportunity for advertising agencies in the digital ecosystem with advertisers keen to maximise bang for their advertising buck.
ONLINE OPPORTUNITY
Online advertising is a huge market. Research firm Group M estimates that the global digital advertising market will be worth $537 billion in 2022.
But regulatory scrutiny has been building around user privacy. Last year Apple made changes to its operating system that required users to opt in to enable companies to use their data for targeted advertising.
This has had a huge negative impact on the advertising revenue for both Facebook-owner Meta Platforms and Snapchat.
