Data Clean Rooms Emerge as Essential Tool for Advertisers in Post-Cookie Landscape

In an era where privacy regulations are tightening and third-party cookies are fading, data clean rooms are stepping up as a critical solution for the advertising industry.

As of September 2025, with Google's cookie deprecation on hold but privacy concerns escalating, these secure digital environments are enabling brands and publishers to collaborate on data insights without compromising user privacy. This shift is particularly vital in markets like India, where the Digital Personal Data Protection (DPDP) Act 2023 imposes hefty penalties for violations, up to ₹250 crore.

Data clean rooms function as neutral territories—often described as "Switzerland for customer data"—where companies can pool anonymized or aggregated information. The process begins with data preparation, where firms cleanse and hash sensitive details like emails and phone numbers. Encrypted data is then uploaded to the clean room, where privacy-preserving techniques, such as private set intersection, match overlapping audiences without revealing individual identities. Analyses yield only grouped results, adhering to minimum thresholds (typically 50 users) to prevent re-identification. Finally, actionable insights, like optimized audience segments, are exported for campaigns.

The importance of clean rooms has surged in the post-cookie world. Third-party cookies, once the backbone of targeted ads, are being phased out due to privacy backlash. In India, Chrome's 90% market share and Apple's tracking blocks on 340 million iOS users have left advertisers scrambling. Clean rooms fill this void by allowing precise audience analysis, campaign measurement, and attribution. For instance, they enable cross-platform tracking of incremental lift—measuring how ads drive additional sales—without exposing raw data. "While everyone's panicking about privacy, smart advertisers are getting better data than ever before," notes industry expert Aresh Mishra in a recent analysis.

Practical use cases illustrate their value. E-commerce giants like Flipkart could identify Amazon Prime members open to switching during sales events, crafting targeted offers. Food delivery apps such as Swiggy might pinpoint Zomato loyalists for competitive poaching. Banks like HDFC can link Instagram ads to actual credit card applications, moving beyond mere clicks. In retail, Hindustan Unilever and DMart collaborate to gauge IPL ad impacts on in-store purchases. Internationally, IKEA and Willhaben reduced cost per visit by 30% through clean room-derived insights. These examples show how clean rooms facilitate competitive intelligence, such as targeting users who shopped with rivals but not your brand.

Benefits are multifaceted. They enhance ROI by curbing wasted ad spend—potentially saving 20-30% on budgets over ₹5 crore—through better measurement of purchases over impressions. Compliance is ensured via encryption, differential privacy, and audit logs, aligning with global standards. Platforms like AWS Clean Rooms and Snowflake offer cross-cloud collaboration, with costs around $2 per compute unit-hour, making them accessible for large-scale operations.

However, challenges persist. Data quality issues, or "dirty data," can delay projects by 4-8 weeks. Match rates hover at 20-40%, lower than expected, and real-time processing is limited to batches. Legal negotiations often extend 6-9 months, per Forrester reports, and building a skilled team of 4-8 experts costs ₹60 lakh to ₹1.2 crore annually. Despite these hurdles, adoption is rising, with 62% of companies requiring dedicated staff.

Looking ahead, data clean rooms represent a paradigm shift toward ethical, effective advertising. As privacy laws evolve, they promise sustained innovation, ensuring the industry thrives without invading user trust. For advertisers navigating this cookieless future, embracing clean rooms isn't optional—it's imperative.

Connect with Us