Google announced last week that it would delay the change in its privacy policy that would end support for third-party cookies on Chrome. Following the announcement, the stock prices for ad tech companies jumped up.
Criteo increased by 12% | NASDAQ:CRTO
The Trade Desk increased by 25% | NASDAQ:TTD
Magnite increased by 19% | NASDAQ:MGNI
Why are the stock prices for Magnite, Trade Desk & Criteo high?
In January last year, Google had announced that it would end support for third-party cookies on the Chrome browser by 2022. This was significant for the digital advertising industry because Chrome is the leading internet browser in the world with 64% market share. Advertisers currently rely heavily on third-party cookies to track user behavior and serve targeted ads to individuals. Google made its announcement in 2020 amidst an environment where users are increasingly conscious about their privacy and how their online data is being used. Marketers however were not too keen on Google's decision as it would fundamentally change how online advertising works. However, over time the decision has received more support and agencies have started to work out alternative strategies to show ads to relevant audiences. Google has decided to push back the rollout of this policy to 2023. This will give agencies more time to test out their new strategies and transition away from 3rd party cookies. This is why following the announcement, the stock for adtech companies rallied.
See also: 3 updates on Google & Apple's Antitrust Woes
More about the 3 adtech companies
1. Criteo
Founded and headquartered in Paris, France, Criteo is an advertising company that provides interactive online display advertisements. The banners are customized based on the online behavior and preferences of users. The company has a pay-per-click model. In response to Google's announcement, Criteo said in a statement, "We appreciate Google's decision to create more time for the industry to prepare, but the extended deadline does not in any way change or impact Criteo's strategy. We continue to build products that will enable our customers to reach and engage their audiences without third-party identifiers."
2. The Trade Desk
The Teade Desk offers users a marketplace where they can purchase different types of digital advertisements, like connected tv ads, display ads, social media ads, etc. This allows their customers to run and manage global campaigns. Chief Technology Officer, Dave Pickles said in The Trade Desk's newsletter that, "It's clear that the privacy technology of the open internet, including [connected TV], needs to evolve in a way that gives the consumer more control. Let's build technology that is understandable, then let customers decide how they want to use it."
3. Magnite
Magnite is the world's largest independent sell-side advertising platform. The company connects ad sellers and ad buyers worldwide. The company has programmatic expertise and is a leader in connected TV advertising. Magnite has not made any comments regarding Google's announcement.
Currently, the stock prices for these adtech companies are at a high. Whether they continue to grow is still unclear. Recently the EU opened a new investigation into Google and how it shares user data with third-party adtech companies. How that investigation goes could change Google's policies on how it shares user data with third parties for the purposes of advertising. Currently, Google uses the data themselves but does not share it with others. Subscribe to Whitepapers online to stay up to date with the latest developments in the adtech space.
Featured image: Logos courtesy Criteo, The Trade Desk, Magnite