The privacy tipping point is here – and you need to act now.

For years, industry experts (including folks here at Hallam) have been ringing the bells of misery as major changes to privacy threatened to change the internet (and therefore the global economy) beyond recognition.

Spearheaded by the much-publicised death of cookies, the once untouchable superpower of digital marketing is under threat: the end of hyper-precision and the ability to target people using the cookie based identifiers we’ve relied upon for decades to fuel our digital campaigns.

The bad news is that the tipping point of privacy is here. The even worse news, is that many brands aren’t taking this seriously enough.

Perhaps desensitised to chaos by the events of the last few years, the mood has often been described as “someone will fix it”, not helped by Google repeatedly postponing its deprecation of third-party cookies, many brands will use this time to kick potential solutions down the road. However, this extension should not lead to complacency – there is a need to act now to develop your first-party data and privacy-first strategies to avoid playing catch up in 2023.

Not sure where to start with privacy? Contact us and we’ll lead the way.


The Three Horsemen of the privacy tipping point

The privacy tipping point is driven by three main factors — when combined, they bring about one of the biggest changes in how we approach digital marketing and the internet as a whole:

the tree horsemen of the privacy apocalypse
The three Horsemen of the Privacy Tipping Point (image generated by Dall-E)

Horseman 1: The cookieless future of advertising

Major disruption to many existing forms of advertising, reporting and attribution models, as third party cookies are deprecated in all major browsers. This effectively ends most widespread forms of cookie-based targeting, and creates a huge challenge when it comes to proving the value of digital marketing investments through reporting and analytics.

Horseman 2: Apple iOS and the end of IDFA

To cut it short, Apple’s changes to the way they handle advertising identifiers in apps (IDFA) has driven a shank into the very soul of the once monolithic advertising powerhouses like Facebook, now Meta. At the touch of a single dialog, iOS users can “go dark” and disappear from ad identification technologies, once the backbone of many mobile advertisers and social networks.

Horseman 3: Regulatory and consumer demand

Consumers are becoming increasingly aware of the need for privacy, and governments and regulators are responding with additional legislation. Legislation such as GDPR in the European Union and the California Consumer Privacy Act (CCPA) as creating major barriers for advertisers and marketers to gather, use and process data.

an oil painting of a cookie crying
Goodbye, cookie. It’s been a ride. (image created by Dall-e)

Why does this matter?

Considering the internet as we know it today is built on cookie technology, these privacy changes are significant. The collective impact of these trends is large, but could be summarised into three main areas of concern:

  1. The lack of third-party cookies severely reduces the ability to identify and target specific audiences, forcing brands to change their approach, relying more on matched first-party data, and triggering a much needed evolution into a full-funnel, cross-channel mindset (more on this in a later post).
  2. The combination of users declining cookies via consent management platforms, and the browser based blocking of cookie tracking means that traditional measurement tools such as Google Analytics are losing huge swathes of data, leaving brands and marketers unable to accurately measure and prove the value of their marketing investments and campaigns.
  3. Digital Marketing has always relied on its ability to provide evidence of its effectiveness, when compared to traditional marketing. The Privacy Tipping Point removes that ability, and changes the rules of the game. And yet, expectations of ROI remain equally high.

As marketers, we need to become more comfortable with the concept of modelling rather than the precision attribution we’ve become accustomed to over the last few years.

Google is shutting down Universal Analytics

As part of Google’s response to this, they are shutting down Universal Analytics in July 2023, as they shift their focus to Google Analytics 4, Google’s next-generation measurement tool. It’s designed from the ground up to measure event-based data (instead of sessions), and is Google’s first major move into a cookieless measurement future.

Google Analytics 4 marks the clear shift from precision to prediction. In a world where we can’t accurately see and measure what happened, our approach to measurement and attribution will shift towards modelling and predicting behaviours, actions and trends. Think of it as a shift from accounting to economics.

You can read more about GA4 here.

Google is also rolling out new features to support the shift toward prediction:

  1. Consent mode: Conversion modeling can help fill in blanks in media measurement at times when it’s not possible to observe the path between ad interactions and conversions. Using machine learning, Google will analyse historical trends, quantifying the relationship between consented and unconsented users.
  2. Enhanced conversions: allows you to send hashed first-party, user-provided data from your website when a user converts. The data is then used to match your customers to Google accounts, which were signed-in to when they engaged with one of your ads.
    This will enable you to regain conversions that in other cases would not be reported, and would therefore devalue your advertising activity.

When combined, they allow GA4 to fill the gaps left by the lack of collected data created by the cookieless internet.

You must act now to avoid loss of performance data.

Although UA will continue to collect data and function until July 2023, you’ll lose access to historical data and reporting from January 2024. Due to the fact GA4 is focused on modelling performance based on events and user behaviour, it needs as much data as possible, as early as possible, to maximise its ability to perform.

diagram showing consent mode and enhanced conversions workflow

The path is clear now: there’s no more time to wait, and there’s nothing left to evaluate. The time to act is now. Hallam advises all clients to take the following action, as early as possible:

  1. All brands must upgrade to Google Analytics 4 as soon as possible to avoid loss of data.
  2. Implement Consent Mode, to allow GA4 to fill in the growing gaps in conversion data left by cookieless users.
  3. Implement Enhanced Conversions to allow GA4 to regain conversions that would otherwise not be reported.

Conclusion

2023 will become the landmark year for privacy, and the dawn of the new cookieless internet. With digital as the backbone of the world’s economies, it’s vital that our ability to accurately measure and attribute the value of marketing spend is protected. Google Analytics 4 is the most profound shift in measurement in a decade, and you must act now to avoid being left behind — not just by competitors, but by the internet itself.

What to do next

Implementation of GA4 and additional technologies is technically challenging, and needs involvement from experts. If you’d like to discuss how Hallam can help you with Google Analytics 4 and your brand’s journey to the privacy-first attribution, talk to your account manager or contact us here.