Demise of cookies expected to put further pressure on Irish media

Media agencies expect Google and Facebook to benefit from the demise of third-party web cookies, putting Irish publishers who lose access to personalised data under further pressure, according to a report by Ignite Media Consulting.

Agency buyers of advertising surveyed by Ignite said they anticipated the two tech giants – already the dominant players in the Irish digital advertising market – to strengthen their position in the market after third-party cookies are phased out in 2023 as a result of privacy concerns about consumers being tracked online.

The two tech giants will account for an estimated €400 million of the €941 million which will be spent on advertising in Ireland this year, Ignite said in its Paradox Report, which addresses the explosion in digital advertising from 17 per cent of the total Irish ad market in 2011 to an estimated 53 per cent this year.

"A cookieless advertising environment has major implications for brands, agencies and publishers," said John Dunne, principal of Ignite Media Consulting.

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“Our research among media buyers who control as much as 60 per cent of Irish advertising spend concludes that Google and Facebook will be the main beneficiaries of this change, as more campaigns will run within their platforms rather than on websites or apps,” he said.

“This doesn’t bode well for indigenous publishers which are already under considerable pressure to compete, given the dominance of Big Tech, leaving a shrinking market share of digital advertising for publishers to compete.”

Irish media agencies typically estimated that about 70 per cent of the digital campaigns they run outside of the “walled gardens” of Google and Facebook are reliant on cookies.

The report was compiled by Mr Dunne and Aileen O’Toole, another independent digital strategist and one of the co-founders of the Sunday Business Post newspaper (now known as the Business Post).

Traditional media

Their analysis highlights the impact that the rise of digital advertising has had on older forms. Press has been most affected, with its share of the overall Irish advertising market declining from 32 per cent in 2011 to an estimated 8 per cent this year. Television’s share has dropped from 27 per cent to 21 per cent, while radio’s share declined from 15 per cent to 12 per cent.

Google plans to block third-party cookies on its Chrome web browser from late 2023, while Apple did so on its Safari browser last year.

Because the bigger technology and social media players possess relatively high volumes of first-party data on their users, they may offer greater appeal to advertisers who want to target particular consumer segments in the post-cookies regime.

However, smaller companies including publishers and app developers may yet find ways to either improve their own data collection or work with companies such as Google to find technologies that allow for ad personalisation while better protecting online privacy.