Four years later, Safari and Mozilla have blocked third-party cookies, and Chrome has…well, finally given a date for when it plans to close the door on cookies for good—Q3 2024.
So, what makes the end of third-party cookies so important? Theoretically, it gives marketers a major headache because they’ll lose valuable data about their target audiences. And that spells lost revenue. However, Chrome says it’s blocking these pieces of code because it can offer a viable alternative to satisfy marketers’ cookie dependency.
In this blog, you’ll gain an insight into the world of third-party cookies and why they’re being phased out. Crucially, you’ll discover the potential impact of this move on your marketing and the alternatives available to keep acing your strategy.
What Are Third-Party Cookies?
Third-party cookies are set by a website other than the one you’re browsing. For instance, you visit a website and watch an embedded YouTube video. Along with the video, the request will result in a third-party cookie being installed in your browser, which tracks you as you visit other websites.
By accumulating data on browser sessions, these cookies provide valuable insights into users. The data can be used to increase conversion rates, shaping the type of online ads you might see when visiting a website for the first time.
It’s worth noting that cookies aren’t just third-party. First-party cookies also gather important user insights but work differently. Stored by the website you’re browsing, they collect user data to help improve website performance. They also perform valuable functions, improving ad targeting and creating fast login times among other things.
Why Google Is Axing Third-Party Cookies
Third-party cookies have been around since the 1990s. How much data they can collect on users has long been a concern, with some personal information leading to invasive online experiences. This type of personal information can include:
- Gender
- Sexuality
- Religion
- Political affiliation
Pushback was inevitable, and legislation like the General Data Privacy Regulation (GDPR) in Europe in 2016 changed the rules: companies had to be transparent about their cookies and the information they held.
Google’s slow start tackling the third-party cookie problem was attributed to its dominant position in online advertising. Indeed, 80 percent of the company’s revenues come from ads, so it wanted to tread carefully. Then, at the end of 2023, the company announced the first phase of testing its new Tracking Protection feature, which was scheduled to start in January 2024. This involved turning off cookies for 1 percent of Chrome users — approximately 30 million users. This 1 percent will then grow to 100 percent from July to September.
Google’s Tracking Protection Tool explained:
Built into Chrome, Tracking Protection is a feature for blocking third-party tracking of users’ online activities. The feature stems from Google’s Privacy Sandbox initiative to create technologies that protect people’s privacy online while helping companies and developers build thriving digital businesses. Its key aims are to phase out support for third-party cookies, reduce cross-site and cross-app tracking, and keep online content and service free for all.
In a blog about the announcement highlighting Tracking Protection, Google was upbeat about the cookie era. Anthony Chavez, vice president of Privacy Sandbox, a Google-led initiative to set website standards for access to user information, wrote, “Third-party cookies have been a fundamental part of the web for nearly three decades. While they can be used to track your website activities, sites have also used them to support a range of online experiences — like helping you log in or showing you relevant ads.”
For campaigners, the decision showed how legislation like GDPR, the EU’s Digital Services Act, and Digital Markets Act, create safer digital spaces, making tech giants rethink their online ad packages.
The Impact Of The End Of Third-Party Cookies
What will a cookieless future look like? Well, it won’t be entirely cookieless, as first-party cookies will still be around (more on that later). But the future will be different in significant ways. User privacy will be better protected. Creepy situations where websites seem to know personal details that you don’t remember sharing will be fewer. On the flip side, the web may seem less convenient. For example, consumers may experience a decline in personalisation, with non-personalised ads becoming widespread, and useful services like pre-filled address information on order forms may no longer be available.
Businesses will be the biggest losers. Some 75 percent of marketers rely on third-party cookies worldwide for valuable data to target audiences. Moreover, more than 50 percent of marketers seem pretty despondent about future revenues when third-party cookies aren’t around.
The well-known cookie-based marketing techniques in jeopardy are:
- Retargeting: Tracking users and serving them ads for products or pages they have viewed.
- Ad targeting: Serving users specific ads based on their unique browsing histories and individual profiles.
Without third-party cookies, businesses won’t be able to determine which products or services interest people visiting their websites. Blank spaces will appear where valuable data existed before, like product preferences and previous searches. This shortfall will impede improvements in customer experiences, including targeted advertising. McKinsey & Company has said 71% of consumers expect companies to deliver personalised experiences, which doesn’t bode well for websites with untargeted ads.
How To Thrive In A Cookie-Free Era
At least, the slow death of third-party cookies has provided time to come up with alternatives. However, your first step before looking at the options should be an audit so you know the impact of life without third-party cookies on your marketing strategy.
With or without that information, there is something you should be doing right now — and that’s optimising your use of first-party cookies. We called this out in an earlier blog, highlighting that first-party data was arguably more important. Moreover, they tick all the boxes right now because they are less intrusive and do not cross-track users. Crucially, they will provide information to personalise experiences and target ads based on a user’s interests.
When first-party cookie data is ingested by Customer Data Platforms (CDPs) and aggregated with other customer-related information, marketers gain deep insights into their audience to help optimise campaigns. Here are some other mechanisms to consider besides strengthening first-party data in the post-third-party cookie era:
- Zero-party data: Customers provide this data intentionally with brands through surveys, polls and membership applications. It tends to provide accurate insights coming directly from users.
- Data clean rooms: These are secure environments where multiple parties can collaborate on sensitive data. Participants extract insights from each other’s data under strict controls.
- Data partnerships: This is a collaborative arrangement between non-competing companies to share data for enhancing targetting and customer segmentation. An example would be an automotive brand – building connected vehicles – and a telecommunications company.
- AI and ML: Here, the predictive capabilities and behaviour modelling with AI and machine learning (ML) make up for the loss of insights from third-party cookies and cross-site tracking.
- Ad networks and platforms: Working with trusted ad networks and platforms that help place ads on sites to gain traffic can provide access to targeted audiences.
- Direct marketing: This traditional form of communication with customers via email marketing, social media engagement, and loyalty programs can efficiently reach audiences.
How We See Life Without Third-Party Cookies
Marketing shouldn’t lose strength once these cookies are off the menu. Undoubtedly, Google is working its socks off to create viable alternatives – since so much of its revenues depend on advertising. Moreover, AI and ML provide more insights into customers, which can make up for shortfalls in lost knowledge of customer behaviour.
One challenge, of course, is transitioning away from third-party cookies. Creating, maintaining and developing the data platforms to leverage advances in AI and ML, for example, takes experience and expertise that internal teams may need to gain. Sure, upskilling or recruiting are options, but they can be costly and time-consuming.
At Ipsos Jarmany, we’re helping our customers develop their data capabilities so that the coming third-party apocalypse is a noteworthy event but nothing more. They continue to improve the ROI of their marketing through advanced technologies that extract significant value from their sales, marketing and operational data.
Start the conversation by getting in touch with us today.
