Are Third-Party Cookies Going Away? The Impact on Marketers
When Google first announced in 2020 that it would be eliminating the use of third-party cookies by 2022, it put the entire ad industry on notice. And while the deadline for this shift has since been extended to 2023, the imperative to find and implement a privacy-safe targeting alternative to the cookie has not changed.
Here's what you need to know about what cookies do and the major changes that have impacted tracking cookies.
Third-Party Cookies: What's Changed?
Tracking cookies are the very foundation of getting to know your ideal customers and using that insight to cater to their needs to the very best of your ability.
The removal of third-party cookies is a step towards eliminating intrusive tracking and moving towards a more permission-based data collection and targeting. Consumers still want personalization in their brand experiences—they just want more control over the extracted data and who accesses it.
The death of third-party cookies was set to debut here soon, in early 2022. However, Google sent out another announcement that they will be delaying the timeline to allow digital advertisers and publishers to better adjust to the upcoming changes without being affected too severely.
"We need to move at a responsible pace. This will allow sufficient time for public discussion on the right solutions, continued engagement with regulators, and for publishers and the advertising industry to migrate their service," Vinay Goel explained.
"This is important to avoid jeopardizing the business models of many web publishers who support freely available content...By ensuring that the ecosystem can support their businesses without tracking individuals across the web, we can all ensure that free access to content continues."
What does changes in ad tracking cookies mean for digital advertising?
Google's announcement to remove third party cookies was never meant to be a direct hit at advertisers — it was only ever a response to many consumers complaining about not having any control over their personal information and wanting more privacy.
Nonetheless, Google blocking third-party cookies affects advertisers in a variety of ways:
- There isn't a third-party substitution (Marketers need to find alternatives)
- Advertisers will have to adjust and adapt to different tracking solutions
- Advertisers will be learning as they go
However, there are ways to thrive without third-party tracking cookies.
MNI predictions: advertising without third-party tracking cookies
We’re keeping our eyes and ears open for any information regarding third party cookies, especially to the below:
- There will be a cleanse in the data marketplace (we will see fewer DSPs, DMPs, and data providers).
- Different data points will likely be utilized to control targeting, reducing the risk of fraud.
- More companies will be fast-tracking their adoption of mobile device IDs that were paired using cross-device graphs.
- Tech giants Google and Facebook will have the solutions you need to survive these changes with third-party tracking cookies going away. Still, you should be wary since they both have significant e-commerce, media, and advertising interests.
- First-party will be king.
- Contextual targeting and IP address targeting will be very relevant.
The Replacement of Third-Party Cookies are First-Party Cookies
With the end of third-party cookies drawing nearer and nearer, companies will need to transition into using first-party cookie data to continue to compete. What is a first-party cookie? Let us tell you.
Simply put, first-party cookies are bits of information stored by websites. Cookies allow domain owners to collect data about visitors and their user experiences. For example, if a user signs into a website or adjusts language settings, it will be saved with first-party cookies.
Different browsers will have different effects on the advertising industry. Chrome first party cookies are most likely to affect the AdTech industry, because this browser is by far the most popular of all. Safari first-part cookies are in second place as far as stirring the industry goes. Lastly, first-party cookies on internet explorer will be minimal for AdTech, as this browser doesn’t significantly block first or third-party cookies.
First-party cookies are more effective in building lasting customer trust
Before the third-party cookie was even being considered for elimination, first-party data was the most reliable source of data collecting. This is because you're obtaining the information you need about your customers from your customers.
Other data collecting (like second and third) require you to go through another business, risking misinterpretations and inaccuracies. First party allows you to gather relevant data in-house and extract meaningful information yourself. Let’s dive into what makes first and third-party cookies different.
First-party vs. third-party cookies
Both types of cookies track website user behaviors, but there are some differences between the two.
- Are set up by website servers
- Are directly collected by websites
- Are only available on the one website that created the cookie
- Allow domain owners to gather information from users like website functions (sign-ins, adding to cart, etc.
- Help users have a better experience on websites as the information is remembered upon return
- Are supported by all browsers
- Can be blocked or deleted by the user
- Are set up by advertisers
- Let advertisers see what kind of behaviors and interests a user has
- Can follow users through multiple websites
- Allow websites to track items searched; if a user buys one item but was actively looking at others, they may receive emails to come back to unpurchased items
- Are supported by all browsers but will be blocked by the end of 2023
- Can be deleted by users if they choose to
According to Marketing Dive, 88% of marketers say collecting first-party data is a priority in the coming year, and 52% of respondents said their organizations had prioritized digital experiences and strategies intending to collect more first-party data. The report also found that 58% plan to collect and store first-party data in the next six to 12 months, with 30% of those marketers considering it their highest priority.
Marketers are going back to relying on contextual advertising
Contextual advertising refers to an automated process in which the advertiser's promoted content matches the content already on the publisher's site. For instance, a travel agent brand delivers an ad offering vacation opportunities in the Rocky Mountains on a website about National Parks in the United States.
According to PR Newswire, the global Contextual Advertising Market will reach $335.1 billion by 2026, up from the estimated $157.4 billion reported in 2020. This predicted increase only further solidifies the growing popularity and importance of contextual advertising in the coming years.
Marketers are also moving towards people-based targeting
People-based marketing refers to a more personal approach to communicating with consumers through advertising. It requires more customized messaging and perfect timing to ensure the brand's advertising messages reach and resonate with the right audience.
Its critical elements include:
- Identification—identify who the exact customers of your product/service are.
- Data—collect relevant information to represent your exact customers, including demographic, psychographic, and geographic data.
- Automation—automate the targeting and retargeting to optimize reach and efficiency.
This will play a vital role in successful advertising now that consumers expect brands to know them and customize advertising and interactions to their specific needs.
According to Forbes, 90% of consumers find marketing personalization 'very' or 'somewhat' appealing, and 80% are more likely to purchase from brands that provide personalized experiences. The report also noted that 72% of consumers say they only engage with personalized messaging.
Navigate These Major Changes With MNI
The changes that have impacted third-party cookies have left many marketers running around for alternatives. After all, this was how most (if not all) of us collected our consumer data to improve our relationships with consumers.
While consumers prioritize privacy, they still demand personalization and relevant communication. First-party data has taken over as the main source of data collecting, but brands are still having difficulty getting to know their target audience. One of the most potent ways to survive the elimination of tracking cookies is to partner with an expert marketing team. By doing so, you will arm your business with the tools needed to attract the right audience and market to them without skipping a beat.
About the Author
@Janine Pollack, MNI Integrated Marketing Director and self-appointed Storyteller in Chief, leads the brands commitment to generating content that informs and inspires. Prior to MNI, Janine worked with Fortune 500 companies and world-renowned education institutions on numerous research and white papers, podcasts and thought-leadership and education campaigns.