What your business needs to know about Google Consent Mode V2

The European Digital Markets Act (DMA) came into force this week, marking an unprecedented milestone in the journey towards greater user privacy and protection. 

It places platforms such as Google in the role of ‘gatekeepers’, making them responsible for collecting EU users’ consent for online cookie tracking. It also places retailers at a crossroads, as they will need to follow a new process if they want to continue tracking online cookies, which is what enables them to understand users’ behaviours and preferences.

If you use Google Ads for marketing purposes and are targeting – or planning to target – European users, you will need to prove to Google whether the user has consented to online cookie tracking. Failing to comply will have you blocked from capturing new user data – creating a significant impact on your remarketing strategy. 

In response to the DMA, Google has introduced a new version of its existing consent mode scheme. Before the DMA’s introduction, the consent mode only limited retailers’ storage of user data. But now, the mandatory Google Consent Mode V2 will also control the tracking and use of user data. In short, Google will provide no user data for those who choose not to consent to tracking through the use of cookies.

So, what does this all mean for your business’s marketing strategy? 

Limited customer data 

Any business that fails to send consent information to Google via the new consent mode will be unable to capture new data from users in the EEA. They will be unable to store new user data in Google Analytics 4 audience lists, and unable to share it with Google Ads.

This will prevent them from remarketing to Google users in the region, reduce the quality of their conversion data, and reduce the performance of their Google Ads campaigns. As such, the new consent mode is something worth thinking about.

It’s important to note that Google Consent Mode V2 has two versions: basic and advanced. The basic mode is simple to understand: retailers are unable to track users who do not consent to it. However, in advanced mode, retailers can benefit from a little more information. Although they still cannot track specific users, they can use anonymous data that Google uses to produce more accurate modeled predictions about conversion rates, for example. This can make a real difference.

But there’s another aspect to this that might prove challenging for smaller businesses. To be eligible to receive conversion modelling data, businesses must achieve at least 700 ad clicks per week, per domain, per country. Smaller retailers who don’t reach this threshold will be at a disadvantage as they won’t have access to the modelled conversion data that larger brands can leverage. While modeled conversion data isn’t as accurate as true conversion data, it’s still helpful when it comes to guiding decision making. 

Staying ahead of the curve

With these new measures fundamentally changing how retailers capture customer data to inform their marketing strategies, marketing teams must implement Google’s new consent mode as soon as possible, if they haven’t already. This will ensure that their practices remain in line with the DMA, but will also allow them to continue to benefit from consensual user data. 

They will need to use consent management platforms (CMP) to implement methods of obtaining consent from site visitors. The CMP can then communicate this information to Google. They must also choose between the basic and advanced versions of consent mode – we recommend using the advanced version as it allows for conversion modelling for non-consenting users.

Retailers must also recognise that the DMA does not mark the end of the road for user privacy. We can expect more legislation that offers users more control over their data privacy in both Europe and the rest of the world. By the end of 2024, for example, Google will have completely phased out third-party tracking from its platform. Some Google Chrome users have already been testing the cookieless platform since the beginning of the year.

Stay on top of changing legislation

This movement will prove a challenge to adapt to, but will also offer exciting opportunities for retailers who move fast. One industry report revealed that 80% of marketers were either moderately or very reliant on third-party tracking data. This suggests a lot of marketing teams will need to make some significant changes to their strategies. They should see these new legislations as an opportunity to adopt fresh ways of engaging with consumers.

Zero and first-party data will become crucial to personalised marketing. Users who do not consent to tracking under the DMA will, instead, offer information to retailers through forms and surveys. This will shape a new relationship between businesses and their customers – a relationship based on trust where the customer remains in control.

Some retailers may be tempted to shift their marketing strategies towards the ‘walled gardens’ of ad platforms offered by Meta and Google. Retailers that do this will benefit from the data that these platforms collect from their users. But they mustn’t become reliant on them because they cannot see or exploit the data itself. They will need to diversify their tactics to ensure that they’re still collecting their own user data.

The new DMA also presents opportunities for businesses to think more critically about the quality of their traffic. With the process of tracking conversions ever-changing, businesses must leverage every available resource to improve the accuracy of their customer data and optimise their campaign performance. For example, by automatically filtering out invalid clicks and fake users from PPC campaigns, businesses ensure that they are working with reliable and precise data, enabling informed decisions.

There is a lot to feel optimistic about, despite the somewhat daunting new legislation being introduced. We’re at the start of a new era for digital marketing that will offer an opportunity for retailers to redefine the way they engage with consumers. It’s crucial that they act now to prepare for current and future developments in user privacy.

Neil Andrew, founder and CEO of leading MarTech scaleup, Lunio