The phase out of third-party cookies is no news in the marketing world. Firefox and Safari introduced this measure in 2019 and 2020 respectively as a way to safeguard users’ privacy. In late 2019, Google announced the launch of the Privacy Sandbox and, at the start of 2020, the removal of third-party cookies from Chrome by 2022. The company also committed to develop a safer and more private alternative for advertisers to deliver relevant ads to customers.
Towards the end of 2021, Google communicated a revised timeline for its project and third-party cookies are now set to fully disappear by the end of 2023.
This delay is mostly due to the need for the whole digital ecosystem to adapt to these changes and develop solutions that could help businesses thrive without abusing personal user data and in respect of privacy regulations.
“How can marketers optimise their strategies to navigate the challenges brought by the demise of third party cookies?”
“Is this the end of marketing personalisation?”
“What does the future of data-driven marketing look like?”
These are only some of the questions being asked in the marketing community today. The answers are not fully known yet but what we can certainly say is that it will become essential for businesses to start building more meaningful relationships with their customers in order to communicate with them.
First-Party Vs Third-Party Cookies
Cookies are text files that websites send to browsers as users visit them and are used to store user information as well as provide a smoother and faster browsing experience. Cookies are also what fuels targeted marketing communications and therefore essential for advertisers to deliver successful ad campaigns that help businesses grow and customers discover products they’ll love. That being said, not all cookies are created equal.
First-party cookies are created by the same website that a user is visiting and are used to store information such as name, username and password, payment preferences and similar data in order to improve future interactions.
Third-party cookies, on the other hand, are created by external domains and are generally used for marketing purposes. They are the reason why you find yourself being haunted by products you have searched for online and that you may have added to your shopping cart but decided not to purchase.
Unfortunately, this is only an example of how user data can be used. Data misuse scandals hit the headlines quite a few times over the past years and increasing concerns over data privacy and security have led businesses such as Google and Apple to make changes to the way these are handled by organisations and advertisers.
Challenges In A Cookieless World
The changes introduced by the demise of third-party cookies from Chrome and the various measures taken to make the Internet a safer environment for users are certainly to be appreciated as it shows how people are becoming more aware of the value of the information they hold and share. It is also a sign that their voices can’t be ignored by corporations and we can clearly see how these are now looking to establish a middle ground between user privacy and their own profits.
As we move towards a cookieless world where transparency on how data is used by businesses is a mandatory requirement, not a few challenges arise for media companies and advertisers.
Of course, attribution and reporting issues instantly come to mind, followed by the inability to correctly identify which channels or campaigns actually drive valuable results and the uncertainty in allocating budgets in an optimal way.
And whilst we haven’t fully got there yet, we can already see how much the advertising industry has been disrupted by changes to privacy regulations and we can also see how media companies are working to develop solutions that address these challenges.
Trends & Predictions
So what can we do as marketers to get ready for the cookieless future? And what are some of the possible solutions that could help us navigate this moment of transition and uncertainty?
First-Party Data Collection
Possibly the most obvious of all, but by far the easiest to implement and one of the most effective. First-party data collection executed in a consensual manner is definitely a key trend we are seeing this year and likely to get bigger as we get closer to the deadline set by Google for the removal of third-party cookies.
Consent-based data collection techniques include incentivising newsletter subscriptions in exchange for discounts or exclusive offers and updates, or running lead generation campaigns across media platforms to grow contact lists.
Increased Investment in CRM and CDP
Investment in customer data platforms that allow to build a unified data view has been on the rise over the most recent times, fuelled by the need of businesses to make sense of the vast amount of data collected from their customers and the interactions with them. A necessity that is only going to become more evident in the upcoming months and years.
Further Growth of Social Commerce
As multi-touch attribution across various channels and platforms becomes more challenging and less reliable, we have seen media companies developing solutions that allow users to complete lower-funnel actions such as purchases and conversions within their own platform, in an effort to reduce the margin for error whilst also providing a smoother and user-friendly experience for customers. Examples include Facebook and Instagram shops, online storefronts built within the social media platforms that make it easier for consumers to complete their purchases and offer a frictionless shopping experience.
Rise of Conversion Modelling
Conversion modelling has already been implemented by tech giants such as Google and Meta and is currently being used to fill in the data gap between different touch points such as a click to an ad and a website conversion. This gap, for example, can exist when the user interacts with an ad shown on a social media platform but does not give consent to be tracked on the advertiser’s website. Conversion modelling gives an estimated conversion rate and value based on data shared by other users in similar circumstances. Not a fully reliable solution, but clearly an effective way to try and maximise ad performance and optimise budget allocation.
Conclusion
To realise how much the ad industry has changed over the past few years and how much more is yet to come is exciting. It’s encouraging to see change driven by a desire and need to respect the rights and choices of the users that everyday allow this economy to exist and thrive. If we prove ourselves able to adapt to this new privacy-first world and turn the challenges we are facing today into tomorrow’s opportunities, we will contribute to the development of an ecosystem that is beneficial to both users and businesses alike.
Here at Optimyzd, we are specialists in tailoring advertising solutions to help businesses reach customers wherever they are. Get in touch to find out how we can help you overcome the challenges brought in by the most recent changes to privacy regulations and meet your needs.
