Is Google Analytics illegal?

Nervousness is rising among Danish companies due to developments in data law. What to do now that Analytics may become illegal in the EU and data rules are being tightened further. In a new ruling, the Austrian Data Protection Authority writes that Google Analytics does not comply with the GDPR rules in the EU. So far, the Danish Data Protection Agency has stated that they are closely reading the ruling before issuing further guidance. Regardless of the ruling, the importance of legal and effective data collection does not change. That's why we're working on solutions that can not only act as a fallback solution to a possible ruling, but also be seen as a valuable upgrade to current setups.

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In this post, we'll talk about:

Is Google Analytics illegal?
What is the problem with Google Analytics?
How to future-proof your data setup
Benefits of server-side tracking
Disadvantages of server-side tracking
Best alternatives to Google Analytics

What is the problem with Google Analytics?

Actually, it's not Google Analytics that is illegal according to the Austrian court. It's the implementation and the way the majority of websites use the tool. Most websites today have Analytics installed via a Javascript. It is activated as a third-party cookie on the customer's device. The problem arises when a customer visits a website where Analytics is installed in this way, as it places a cookie on the customer's device and data is sent directly to the US via the customer's device. This type of tracking is called client-side tracking and is the most common today.

The "illegal" data sent to the US includes a unique ID that the customer has across all websites, as well as a possible IP address.

The US does not comply with all provisions of the GDPR legislation and it is therefore not legal to export personal data to the US, according to the court in Austria. The US could solve this problem by aligning its own data law with the EU GDPR law, but this is unlikely to happen.

Future-proof setup

Server-side tracking ensures that all website data can be collected without the use of third-party cookies. The technology in server-side tracking makes it possible to collect data that meets the GDPR requirements for anonymity. With server-side tracking, the user's device first sends data to the website's own server, from where the data is sent to Analytics. In this way, you can prevent Google Analytics from ever receiving the user's IP address and unique ID, for example. You have full control over what information is collected by users and what is sent from your server to Google Analytics. Server-side can be set up without cookies and as a first-party cookie depending on the company's needs, but both have in common that it is much more controllable for the company.

Alternatively, you can replace Google Analytics with other analytics programs, but we'll talk more about this in a future post where we share our experiences with this.

Server-side tracking optimizes your current data collection and website experience.

There are many benefits to server-side. It solves problems other than "illegal data collection". It solves issues such as adblockers, shortened cookie lifetime and slow websites.

Increased performance

Server-side tracking is triggered by an http response, unlike client-side tracking which is triggered by a javascript. This means that when a customer visits a website with client-side tracking, all the customer's actions on the page will trigger different Javascripts. This slows down the website. Server-side tracking, on the other hand, does not use Javascripts and therefore does not slow down the loading speed. This is rewarded by both users and Google.

Become more GDPR compliant:

Server-side gives you more control over the data your websites receive. You have full control over the data you collect and the data you pass on. That way, your business becomes more GDPR compliant.

Increased cookie lifetime

In addition, the cookie lifetime is also longer with server-side tracking than with client-side tracking, as e.g. Safari's ITP and Firefox ETP only target cookies that are activated by javascript. This means that you will be able to track your customer's journey for a longer time and get a better understanding of the full customer journey. Sessions will remain the same, but will then be linked to the same visitor.

An example could be that your website sells real estate. Here, the decision-making process will typically be longer than on a website that sells sweets. With server-side, you avoid a lot of "new users" in your analytics, which in reality are not new users, but simply visitors who have not been on your site for a while and therefore their cookie has expired.
So if your business wants to better understand the customer journey, this is a great method.

All of this ensures that the company is able to collect and make available the data needed to make solid data-driven decisions.

What is the downside of server-side tracking?

There are many advantages to server-side tracking, but there are of course also some disadvantages to consider.

Technically very

The actual setup and monitoring of server-side is very time-consuming. The concept of server-side tracking has actually been around for many years but hasn't been used much as it used to require a high level of technical knowledge in development and was very time consuming and costly. But then something happened in 2020. Google made it possible to set up server-side tracking via Google Tag Manager and Google Cloud. This means that it is now significantly easier to set up and monitor than it was before.

Costs money

You pay for your server-side tracking, as you have to pay to host your server and the amount of your traffic also has an impact on the price. You pay a minimum price of 120$ and for websites with high traffic and many tags, the price can increase to 200-300$ per month.

Matomo Analytics - The best alternative

Looking for a good alternative to Google Analytics? Our suggestion is Matomo Analytics. Matomo is a popular alternative to Google Analytics (GA). At InboundCPH, we have implemented and operated Matomo for a number of customers since 2020. Matomo is a New Zealand company, a country with the strictest GDPR requirements and their cloud servers are hosted in the EU. Read more about Matomo here and see how we can help you get started.

Here you can see a complete list of European alternatives to Google Analytics

If you would like to learn more about server-side tracking or your data collection in general and how it can be improved and optimized, please contact Alexander Kobberø.

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