While some marketers hoped Google would show some mercy to third-party cookies, the company has no plans to back down from its upcoming “Cookiepocalypse.”
In June 2021, Google announced that it would phase out third-party cookies at the end of 2023, with new tracking technology to replace them. Given the widespread use of Google Chrome, the advertising industry may wonder how it can still deliver personalized ads and reach consumers in a post-cookie world. While marketing teams have other digital advertising options, they may need to adopt new technologies.
Still, Google isn’t the first company to phase out third-party cookies due to privacy concerns. Apple eliminated them from Safari and requires apps to obtain user permission before tracking activity. Mozilla’s Firefox started blocking third-party cookies in 2019. Additionally, privacy-conscious consumers can download extensions to block third-party cookies from Google.
Browsers can use eight types of cookies, although first-party and third-party cookies are the most common. A cookie stores a small amount of data on a user’s computer, such as the site visited, login information, and the pages the user viewed on the site. A first-party cookie only obtains data from the site that the user has accessed.
The gray area for user privacy is provided with third-party cookies, which allow other sites to access the data. For example, organizations can run an ad on social media platforms like Facebook or Instagram for the same shoes a user saw on a company’s website. Third parties may also track user behavior across multiple sites. If a user purchases kayaks, an advertiser may use this information to place relevant ads in the user’s social media feeds or inbox.
Google uses first-party data for user preferences and authentication and third-party cookies for advertising. Some cookies allow Google to serve ads on third-party sites, measure campaign performance and conversion rates, and personalize content, according to its support page.
What will Google’s decision mean for marketers?
Digital advertising relies on third-party cookies to track website activity, as they can deliver targeted ads on social media, according to David Farkas, founder and CEO of The Upper Ranks. “Profiles could not be established, accessed or maintained without [cookies]; customer data could not be collected without user profiles, and targeted marketing could not be conducted without data,” said Farkas.
When Google announced its decision to end third-party cookies, many marketers worried that they could no longer track the right data. Yet the end of Google’s third-party cookies doesn’t mean marketers are running out of options; this means that they must adjust their strategies to directly use the data provided by customers.
“First-party customer data is the most reliable and relevant approach to uncovering your target audience, their brand engagement, their purchase process, and the best way to reach them,” Farkas said.
David FarkasCEO and Founder, The Upper Ranks
Instead of tracking users by their devices, marketers could collect information directly from customers through the websites and apps they access. First-party data allows for better predictive modeling to predict what a customer might buy next, Farkas said.
Alternatives to third-party cookies
While first-party cookies serve as an alternative to third-party data, marketers may also use tracking technologies such as device fingerprinting and contextual targeting that do not rely on user data.
Contextual marketing. For this approach, also called contextual targeting, users receive ads that match the content they are viewing instead of ads that match their data. Pasma said he sees contextual marketing as “future-proof” against the end of cookies because it doesn’t require user input. Contextual ads match website content using keywords and topics. For example, a user reading health-related news might see an advertisement for exercise equipment on the same page, he said.
Contextual analysis often uses AI and natural language processing, which helps marketers deliver more targeted ads to consumers. These analytics can improve the performance of video ads, according to Michael Schwalb, managing director of partnerships and data at JW Player.
“AI and natural language processing [have] enabled precise analysis of the video content itself, with the ability to identify objects, people, themes and languages. Ultimately, it gives advertisers the ability to buy user intent at a scalable subcategory level in a way that was not possible with third-party cookies,” Schwalb said.
Google topics. An alternative in its nascent stage is Google Topics. The Topics API groups users anonymously by interest, based on the websites they have visited in the past three weeks. Topics allow marketers to continue delivering targeted ads. It replaces the Federated Learning of Cohorts – Google’s first third-party cookie replacement, which never reached the launch stage. Google is set to launch a developer trial for Topics in the first half of 2022.
Ultimately, the end of Google’s third-party cookies is not the end of digital advertising. However, marketers need to re-evaluate their strategies and consider alternatives to reach ideal customers.
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