Mumbai: This is largely in line. Alphabet wanted to implement privacy measures and go completely cookie less in the next six months in June/July in a phased manner which they mentioned in their last two earning calls. Advertisers are likely to face challenges, especially in terms of conversions, as many third-party programmatic platforms heavily depend on cookies for data. Furthermore, programmatic platforms may seek to mitigate the impact by considering price hikes for their services. These shifts underscore the evolving landscape of digital advertising, posing challenges for advertisers and reshaping industry dynamics.

This move will have a threefold impact. 1) The restriction imposed on platforms for third-party data usage for advertising is expected to lead to a substantial increase in data costs. 2) The shift towards a cookie-less environment and the limited availability of third-party data for advertising is likely to drive a significant surge in e-commerce advertising spends. Advertisers are expected to increasingly favour e-commerce platforms due to their access to valuable first-party data, providing a substantial boost to advertising investments in the e-commerce sector. 3) Platforms/ad tech companies  may also try to raise the prices from the advertisers to recover the high data costs.

The transition towards a cookie-less environment and potential privacy measures, especially considering the dominance of Android in the global smartphone ecosystem and Apple's prevalence mainly in emerging nations, is expected to be a disruptive force. While Apple holds less than 10 per cent market share in emerging markets like India, the move is anticipated to reshape the landscape of digital advertising, influencing privacy standards and impacting conversion dynamics. The move is very much in line with our expectation and marks a significant change in the digital advertising landscape.

The credit of this article is attributed to Elara Capital SVP Karan Taurani.