All the major web browsers will soon end support for 3rd-party cookies, and digital ad targeting and attribution tracking is about to change in a big way.
No matter how much you know about cookies – we’ve got valuable insights for you in this article.
What are browser cookies?
In Internet terms, a cookie is a small bit of text created and stored by your computer when you interact with a website that records information about your interactions. The data recorded include things like preferences and actions so that the site can personalize your experience.
You’ve most likely encountered cookies when shopping online – they make virtual shopping carts possible. When you add a product to your cart and continue shopping (or return days later), a cookie is saving that information so that the website recognizes you as you browse from page to page or leave and return. Without cookies, every purchase would likely have to be a separate transaction.
Cookies also remember your language preferences (for websites that serve global audiences), and prevent you from having to type in a password every time you visit a subscription-based site. They also allow marketers to retarget you on other sites with ads for a product you browsed on a different site.
How are 1st-party cookies different from 3rd-party cookies?
In a word, relationships. All cookies are basically the same from a technical perspective, and the difference between 1st- and 3rd-party cookies is who the data is shared with.
When you visit a website, the cookie created between you and that website is a 1st-party cookie.
Third-party cookies are those that originate from a website other than the one a user is visiting.
How are 3rd-party cookies used?
In the marketing ecosystem, 3rd-party cookies are perhaps most visibly used by three groups of people:
- Content creators who rely on advertising for revenue (i.e. “free” news sites like cnn.com)
- The ad networks that sell advertising inventory to marketers, (i.e. Google, Facebook) and
- The marketers who place ads on behalf of their clients using the ad networks (i.e. us and you)
Tracking user behavior as they visit various websites (combined with other data) helps ad networks immensely in being able to predict what ads should be shown to whom and when. It’s one of the things that makes digital advertising highly-effective while also being relatively inexpensive – the ad networks are able to personalize ads to each individual user.
How effective is the targeting? As many marketers can tell you, this model has become so pervasive that users on social media will actually comment in anger when they see ads that aren’t specifically relevant to them.
Why are 3rd-party cookies going away?
Primarily to give users more control over their privacy. Over the past decade, many people have become concerned about how they are tracked online. This has led to laws like Europe’s General Data Protection Regulation (GDPR), and California’s Consumer Privacy Protection Act (CCPA). The litany of privacy violations by major Internet companies over the past few years hasn’t helped either.
When are 3rd-party cookies going away?
It’s important to note that the move to eliminate 3rd-party cookies has been underway for some time. Mozilla’s Firefox and Apple’s Safari began restricting 3rd-party cookies in 2013, and in the past year they began blocking them outright by default. Google announced its Chrome browser would phase out support for 3rd-party cookies over a period of two years back in January, 2020 (i.e. January 2022).
Similarly, the use of ad-blockers and other privacy tools has increased over the past decade – further limiting the use of 3rd-party cookies.
The impact of these changes has been muted until now because Firefox is only used by about 4 percent of U.S. users, while Safari has about 38 percent of the browser market share. The biggest player in browsers is Google’s Chrome, which is used by nearly half of Internet users in the U.S.
How does the end of 3rd-party cookies impact my marketing?
In research, the larger your sample size, the more reliable your results. That principle is hard at work in digital advertising – the thousands of signals from millions of users are the cornerstone of the current adtech landscape.
If ad networks lose the ability to observe and understand a large part of the web-browsing public, it stands to reason their predictions about audience targeting will be less accurate. If ad targeting is less accurate, it will cost marketers more time and money to reach relevant audiences while also reducing the effectiveness of ad campaigns.
Attribution is another area that this change will likely impact – it will be harder to determine the origin of a conversion with less insight into user behavior prior to a purchase/conversion.
All is not lost, however. In most cases, a decline in the power of behavioral and predictive targeting can be offset with other forms of targeting – and – by adjusting a brand’s portfolio of marketing channels. Attribution has always been a tough nut to crack, even with the help of 3rd-party data – now we may have the necessary justification to invest in additional resources.
What should I ask my agency or marketing team about 3rd-party cookies?
Hopefully your marketing team has been planning for this eventuality – but it never hurts to check. They should welcome a conversation about how to target audiences without 3rd-party cookies because some of the solutions may involve accessing untapped resources across your organization.
Here are some ice breakers to begin that discussion:
- What data are we not currently collecting or utilizing that we should move to integrate into our campaigns? (Bonus: “And how can I help?”)(You can likely minimize the impact of losing 3rd-party cookie data by doing more to capture and actualize your own data for targeting. In our experience, many small- to mid-size organizations are not capturing all contact points with customers in a CRM. Or, if they are capturing that data, it’s infrequently being used in real-time to power audience targeting. Time to leverage that “business intelligence” everyone has been talking about.)
- Does our organization have any silos that are impeding us from sharing our own 1st party data internally?(The larger the organization, the more likely it is that there’s ample room to improve by breaking down internal walls to better share information. In fact, we’ve seen many companies turn to behavioral/predictive targeting specifically because there were too many barriers to accessing data already held by other departments.)
- Are there any opportunities for us to invest more in contextual targeting?(Good old-fashioned contextual targeting seems poised for a renaissance. It never really went away – after all, search ads have remained a vital part of every digital campaign – and there’s likely plenty of untapped opportunity you can unlock with your creativity and a reallocation of your budget.)
- Are there any steps we can take to improve our attribution model in preparation for the deprecation of 3rd-party cookies?(Understanding how your marketing efforts perform is vital to decision-making, and this change may challenge your ability to track the source of your conversions. There may be some relatively easy ways to compensate – for example, brief surveys of your customers.)
Conclusion
Digital marketing has always been in a state of perpetual change. The seasoned among us know that this too will pass.
There is much we don’t know about the future of digital marketing – as if the end of 3rd party cookies weren’t enough – Apple’s iOS 14 App Tracking Transparency requirement may also hinder targeting/tracking in the “walled gardens” some hoped would be immune to the deprecation of cookies.
What we do know, however, is that proactivity, creativity, and flexibility have overcome all digital marketing challenges thus far – and we’ll need them because there’s no one-size-fits-all solution to this challenge. Your company’s response will need to be individually tailored to the new landscape.
If you’re reading this article, you probably haven’t started this important conversation within your company yet – but there’s still time. BlackTruck Media + Marketing is here to help get your organization ready for this brave new world.
