Google announced in January 2020 that it would do away with third-party cookies within two years. It later announced they will be extending the deadline for the cookie-blocking privacy plan until late 2023. This gives marketers some “borrowed” time to prepare for this update.
The deadline extension by Google gives regulators, publishers, advertisers, and the general public time to prepare for this change.
However, this latest update has led to many discussions about how the future will look for advertisement and data-driven strategies.
Like many other marketers, you wonder what this update means and what you can do to prepare yourself before the deprecation of third-party cookies. Luckily, you have come to this post. Here we look at everything you need to know about the cookieless future and how to prepare for it.
What are cookies?
Before we look at what the cookieless future means for markets, it is important to first look at cookies. If you are already familiar with cookies, you can skip this section. If not, don’t worry; we are here to help.
When a website remembers you, they can provide you with more personal and convenient website visits.
Although cookies play a vital role on the internet today, they can lead to vulnerability to privacy. Yes, most cookies are perfectly safe, but some can track you without your consent. In worse scenarios, legitimate cookies can be harmful if a criminal gets access.
Cookies come in two types: first-party and third-party cookies.
Understanding first-party cookies
First-party cookies are files that originate and are stored on the website that a user visits to improve the customer experience. In other words, these cookies allow the site to remember the user’s passwords, language, and other preferences, including visitor behavior.
An excellent example of this is Amazon. It allows the user's browser to save a data file for that domain name on their computer. This way, a user can stay logged in for future visits (of course, this doesn’t happen for weeks).
What about third-party cookies?
Unlike first-party cookies, third-party cookies come from other domains. In other words, they are dropped by another website (not the one you are visiting) via a script or tag. They observe consumers and serve ads, including retargeting.
I am sure you’ve experienced this. You are browsing items on Amazon, and suddenly, you see ads for the same products on another site. That is a result of third-party cookies — they tap into the tracking data on shopper’s devices to try and convert them.
The main difference between first-party and third-party cookies is that first-party cookies are accepted automatically, while users need to be notified of the latter.
Why are third-party cookies going away?
As earlier stated, third-party cookies are hosted on other domains other than the one you are visiting. That being the case, the main reason why they are going away is due to privacy issues.
Internet browsers like Firefox and Safari have successfully removed third-party cookies from their browsers, with Google slated by the end of 2023. All this is aimed at increasing privacy measures for internet users and increasing transparency around marketing efforts.
So, what does a cookieless future mean?
Change is inevitable; change is a good thing. However, usually change comes with many questions more than answers. This is especially the case for this update as marketers wonder how they will target and segment their audiences without cookies.
While this is a valid question (we’ll look into this later in this post), it is important to understand that this update also comes with good things. More specifically, the cookieless future presents a digital advertising world where targeting is more personal, accurate, and trustworthy.
Although the third-party cookies allow for targeting and audience segmentation, it has room for discrepancies. This is because there are various ways to gather and trade third-party cookies, meaning there’s a high chance of inaccuracies.
However, in the cookie-less world, we’ll become more reliant on data we ask and earn from users (first-party data), which is more reliable and accurate.
You might like third-party cookies as a marketer, but what about as a user? Perhaps not. While privacy issues have been around for a long time, different countries have adopted their own privacy policies in the recent past. Think about GDPR, LGPD, CCPA, among others, and now chrome is joining the course.
That leaves marketers and advertisers with only one option: building relationships with users and earning the data you want from them. That’s what really matters. The cookie-less world doesn’t allow room to collect data without permission. Of course, this is an excellent thing if you want to build trustworthy relationships with potential customers.
As earlier stated, a cookieless future means marketers and advertisers will need to rely more on first-party data and build trust by asking for customer data in honest and transparent ways. The cookieless world will be more personal, especially considering that you might be allowed to target customers using 1:1 personalized ads.
How to prepare for a cookieless future
Developers, marketers, and advertisers need to develop a holistic plan to prepare for a cookieless future. After all, this update will impact how we run digital campaigns, measure their effectiveness, and drive outcomes.
As with many new things, the secret is to start early. That means you need to start now to solidify your marketing strategy and gain a competitive advantage. To that end, here are the steps to take to prepare for a cookie-less future:
Stay up to date on third-party cookie news
Like any other update, you need to stay up to date on data privacy moves. Google is still working on FloC, and other solutions in its Privacy Sandbox, meaning these policies will continue to evolve to meet users' needs. That being the case, you must be aware of the latest third-party cookies and data privacy moves affecting your business.
Focus on first-party cookies
If you rely on third-party cookies, it’s time to change the tactics and focus on what really matters — first-party data. Some marketing professionals out there suggest buying media that rely on people-based identifiers.
The best thing about people-based identifiers is that they don’t rely only on cookies and other device-based identifiers, and they help improve ROI and accurate measurement.
More specifically, when using people-based identifiers, all of your impressions are measured across the entire advertising ecosystem, meaning no data loss due to cookie syncs.
It also means that marketers must invest more in new and improved ways to connect with customers. Think about channels like direct mail, search, email, point-of-sale personalization, television, and other crucial channels that can make a strong marketing strategy.
The goal is to optimize the customer experience to get the expected or positive results. The catch is to personalize every engagement when interacting with consumers on your website, mobile app, or in-store.
Audit your technology and make the necessary changes
As you’ve seen, the cookieless world will be based on first-party relationships — a more transparent interaction between your brand and your customers. This will significantly eliminate the need for intermediaries and tools to help build relationships with your customers.
As a result, technologies that rely on third-party cookies and mobile IDs might not perform when this update is fully implemented. That means you need to analyze your current solutions and make the necessary changes.
Most tech companies use third-party cookies on mobile and desktop for targeting and reporting. However, based on this update, companies will be forced to remove the reliance on cookies and shift toward a future that meets new privacy standards.
Revitalize contextual advertising
The main question developers and marketers are asking is: what will happen on the open web without cookies? Here are the options:
- Substitute cookies for an alternative technology
- Switch to privacy-first targeting options
The tech world is still looking for a proper solution for a cookieless future. You see, the main problem with the cookie is the lack of privacy and not its technology. Since users are more concerned about their privacy, any technology that doesn’t respect user's privacy will not prevail.
Contextual targeting is available and workable at scale and is as effective as audience targeting. While you can use third-party data to place ads in front of people with relevant user profiles, contextual advertising provides an excellent way to place ads on relevant websites that rank for specific keywords.
The best part is that privacy-first targeting options like contextual advertising is less intrusive and combines relevance with the scale, allowing you to reach a broader audience using a particular keyword.
Create a frictionless experience around first-party data collection
Third-party cookies allowed marketers to collect data from people they had not interacted with easily. The case is entirely different for first-party data collection as it involves building direct relationships with customers and asking them to share information about themselves for personalization or value.
As you would expect, this might create friction between you, the marketer, and the customer.
To avoid friction, you need to derive ways to create relationships with your customers and create an excellent first impression. The best approach to this is thinking about the value you offer the potential customer instead of just putting a consent form.
For instance, you can offer discounts, free content, loyalty clubs, collaborative projects, and other things that can influence customer mindset at the point of consent.
Be useful and relevant
If you need your customers to be willing to share data, you need to build trust. You need to be more relevant and valuable to maintain trust. Think about the channels you can talk to your customers, and how do you give them a pleasurable experience?
Another thing to keep in mind is that you need to prioritize customers over cookies. After all, you need to target relevant people with your offering.
Own customer relationship
First-party data forms the foundation of building direct customer relationships, which is key to giving customers personalized content at the right time.
While building a first-party data foundation is a journey, you need to ensure that it is enabled by technology that allows you to own the data. The truth is, not all platforms will let you own the customer relationship, so ensure to choose the one that allows you to own your first-party data.
Increase your digital marketing investment
A positive image means a lot for most ecommerce businesses, and data from third-party cookies have been a large part of this process. If that’s the case in your business, you can expect a sudden shift in your brand image when the change is effective.
One way you can support your ecommerce is to invest in other avenues of digital marketing. Of course, the cookie-less future is slated towards the end of 2023, but boosting your online presence will help your transition when the time comes.
For instance, you may want to invest more in keyword research or explore other forms of advertising like content marketing. However, you should not forget the most important thing: your store’s trustworthiness. After all, privacy has become a fundamental issue for customers and marketers alike.
That’s it. The cookie-less future will be with us in two years (by the end of 2023, to be precise). As I stated earlier, Safari and Firefox have already eliminated third-party cookies on their browsers.
As a responsible marketer, you need to start preparing for this update now. Building a first-party data strategy to personalize customer experiences is just the beginning.
You’ll need to build a whole new suite of addressability solutions to replace third-party cookies. You’ll also need to focus on other things like SEO and Core Web Vitals to get the most out of your marketing efforts.