Over the last few months, there has been a lot of talk and speculation about what a “cookieless” world would look like, and what the future looks like for digital marketers.
Google recently announced that it plans to delay the phasing out of third-party cookies for Chrome in 2023, a year or so later than originally planned. Whilst other browsers like Safari and Firefox have already implemented some blocking against third-party tracking cookies.
Chrome is the most used desktop browser and so its shift will be more significant for the ad industry. Soon, marketers will have to figure out how to run effective campaigns without relying on third-party cookies. But what does that actually look like?
The rise of privacy activism
Before we dive further into what a cookieless world would look like, it’s important to understand the context behind data privacy.
According to Cognizant, “91% of consumers” are concerned or very concerned about the privacy of their data online.
In addition, a 2019 Gartner survey, revealed that 89% of customers expect to disengage from a company that infringes their trust.
What’s clear is that consumers aren’t convinced that businesses are using their data to create better experiences and believe that the dangers that come with companies collecting their data outweigh the benefits.
In order to maintain trust and engagement with their customers, action has been taken by major technology companies.
In April 2021, Apple disabled app tracking by default in their iOS 14.5 update, so users must now allow companies to collect data from their apps and websites for targeted advertising or advertising measurement purposes. According to Flurry, only 18% of users allow app tracking worldwide, and in the US that number is only 11%.
While Firefox and Safari already block those cookies by default, Google slowly began moving in that direction in early 2020. However, Google has delayed plans to phase out third-party cookies until 2023. Google says that this is “subject to our engagement with the United Kingdom’s Competition and Markets Authority (CMA).” In other words, Google has placed part of the delay on the need to work closely with regulators to produce new technologies to replace third-party cookies for use in advertising.
According to Cheetah Digital, 41% of American consumers regularly delete cookies and 30% have installed an ad blocker in their browser.
Next, let’s dive into what exactly cookies are and how they’re used in marketing.
What are cookies?
Cookies are pieces of code that are placed in your browser history to collect information about your online habits, previous visits, and search history. This information is used to deliver targeted advertisements and to personalised content to you.
There are two types of cookies, first-party and third-party cookies, and it’s this difference that’s important. Whilst, third-party cookies will eventually be phased out, first-party cookies will not.
So, what’s actually the difference between them?
Well, first-party cookies are placed by a company when a user visits their website. For example, if you visit a website, then first-party cookies are used to remember things like your preferences, shopping cart items, and to generally track your behaviour.
In general, this means that companies can understand how users engage with their website, allowing them to optimise their website to deliver the best user experience (UX), by ensuring that users are presented with the most valuable and engaging content.
Third-party cookies are slightly different as they are placed by a third party when a user visits a website. These cookies track users across all websites, collecting data for audience profiling, targeting, and delivering personalised ads.
Whilst third-party cookies can be extremely useful for marketers to display ads that are personalised to user-based profiles, meaning that users are shown ads and content that would be useful to them. There have been outcries over privacy concerns because third-party cookies typically collect information about your age, gender, location, the websites you visit, time spent on a page and purchases.
What does a cookieless future look like?
Consumers will get more data privacy and fewer invasive ads. However, this will likely mean more irrelevant ads for consumers
However, the demise of third-party cookies is a much more complicated change for marketers.
A survey undertaken by Adobe showed that “Only 17% of respondents” said their businesses are effective at gathering first-party data to deliver strong experiences throughout the customer journey. With 60% of senior executives saying that "the loss of third-party cookies will have a disruptive effect on their marketing”.
For marketers, the trick will be recreating some form of targeting and personalisation without using advertising strategies that rely on cookies.
How can digital marketers prepare for a future without third-party cookies?
Third-party cookies are mostly used at the very top of the user funnel.
Marketers, like myself, use the types of channels to attract highly relevant prospects, which then feed into the user journey and purchase stages.
Whilst there are concerns about attracting new prospects, I’ve seen great success for clients and here are a few tactics.
Using contextual advertising
Use contextual marketing to place ads next to relevant or related content. With contextual targeting, the ads you serve are based on the content users are looking at instead of their overall behaviour profiles.
I think that we’ll see a move back towards focusing on producing and distributing relevant content. However, this will rely on advertisers and publishers moving together to ensure that this works at scale.
Google AdSense, allows you to place image, video, and text ads on the pages of participating sites online, which means that you can place dynamic content in front of people that haven't heard about you.
People-based targeting
Since most mobile devices and apps don’t accept cookies, the effectiveness of cross-device remarketing has been hindered for a while now.
Also, as cookies are device-specific, when someone goes from their work computer to home or switches from desktop to mobile, the retargeting trail goes cold.
The other issue is that you can also end up wasting money on remarketing to people who already converted on their other devices.
This is where people-based advertising comes in and bridges the gap.
Introduced by Facebook, people-based advertising relies on a unique identifier that's related to the user, and not the device. According to MartechSeries, people-based marketing is defined as “a means to create a customer-centric, cohesive marketing system that revolves around customers and their real-time behavioural data. This data, combined with available first-party brand data, allows brands to target customers in real-time, across devices and channels.”
As this doesn’t rely on any third-party cookies to gather user data, it means that businesses can engage with consumers when they are ready.
People-Based Marketing can be outlined into two key elements:
- Identification
Businesses need to establish who their customers are and connect them correctly by relentlessly tracking cross-device usage for a single view of the customer.
If a customer journey is not tracked maliciously, it could lead to incorrect assumptions about customer behaviour. Which will cause inaccuracies in data which will ultimately lead to ineffective marketing campaigns.
- Data
By using first-party cookies, businesses have the ability to gather data on how users are engaging and interacting with their websites. This information gives businesses an advantage to target them effectively.
This shouldn’t just be based on just the analysis of historical data, businesses should also refer to real-time behavioural data like the device, their carts, and the products and categories they visited.
Linking together these data points allows marketers to get a singular view of the customer.
Websites like Facebook and Amazon require the users to be logged in whilst using their platforms, which means that their customer identification and data functions across their ecosystems and cross-platforms. As they have more first-party data than any other company on the planet, I predict that we’ll start to see more businesses opting to use these types of platforms.
If you'd like to learn more about cookieless tactics, feel free to get in touch.
