Google Privacy Sandbox And The Radical Departure From Ad Targeting

What Google is doing in terms of changing ad targeting and protecting consumer privacy is a radical departure from how the industry works today, and it remains to be seen what will and will not work for the advertising industry.

“There’s still a significant amount of misunderstanding on how it works,” said Anthony Katsur, CEO of IAB Tech Lab. “Not because Google isn’t making an effort, but there’s a lot of ground to cover. The Privacy Sandbox APIs are very complex.”

Let's face it -- part of it is understanding how it works, but the pieces that go into serving one ad are complex.

Google’s advertising business is not just an auction. People talk about buying and selling, but the process is a massive undertaking, and the speed at which it happens is astounding.

“If you think about it, the Privacy Sandbox effectively moves the auction into the browser, and that’s unprecedented,” Katsur said, adding: “not just in our industry, but in any financial exchange or any marketplace like a wheat and grain auction. There’s never been a middle layer. It’s a radical shift.”



When a bid request goes out for a specific ad space and responses come back, the publisher has an opportunity to submit a query into the Privacy Sandbox to identify an available slot.

“If the Privacy Sandbox has an available ad slot that meets the publisher’s request, it never leaves the browser,” he said. “The decisioning all happens in the browser.”

One of Katsur’s major concerns is the lack of industry preparedness. Ad technology is a bit more prepared, but the implications are vast.

What does it mean for impression counting? What does it mean for attribution? How does an impression render and how is it counted? These are some of the questions that will be answered through the IAB Tech Lab Privacy Sandbox Task Force.

“2023 has not been kind to publishers, and many of these companies are pushing hard to meet Google’s first-quarter deadline,” Katsur said. “But I don’t know if that’s enough time.”

The task force was created recently to conduct rigorous technical and operational analysis of Google's privacy modifications and the implications for digital advertising. The new working groups will help companies navigate Privacy Sandbox Changes in the Chrome Browser.

Google will test Privacy Sandbox through 2024, with 1% of third-party cookies deprecated beginning the first quarter of 2024.

IAB Tech Lab will publish an assessment of the tools hopefully in December, but possibly in January 2024, Katsur said. This means a gap analysis and use case.

Every sector -- from publishing to ad technology and brands to agencies -- will see a report on what works as well as what doesn’t work for retargeting.

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