Google's Third-Party Cookie Phaseout: What marketers need to know.
In 2020, Google announced it would phase out third-party cookies from Chrome browser over two years. Marketers have since been speculating on the negative consequences this could have on targeted campaigns and reaching new customers. Google Chrome accounts for 64% of the global market share, making it the most widely used browser that allows both first-party cookies and third-party cookies.
Third-party cookies are integral for marketers to track users and deliver personalised ads to users around the web. While this will be a big change, it's not all bad news.
The phase-out does not include first-party cookies. You will still be able to monitor how customers interact with your website and deliver personalised content and ads.
The truth is, Google Chrome's third-party cookie phase-out could heavily impact some areas of the marketing and advertising space, while other tactics will still stay pretty much the same. If you're an advertiser or a marketer who's thrived on third-party data for targeted audience strategies, read on...
What are cookies?
Cookies are essential to digital marketers. They're used to track users around the web, create enhanced online experiences, and deliver personalised ads based on user's behaviours and preferences.
Not all cookies are the same, and not all cookies will be phased out. Cookies are managed differently depending on the browser and have different permissions. Essentially, cookies are pieces of code that are saved by websites onto a user’s web browser. There are many uses for cookies but marketers primarily use them to track users for personalisation and session management. Cookies are not in programs and don't perform any specific functions. Instead, they are simple text files. In adtech, cookies track users as they visit different websites. After visiting a website, cookies on that website will be saved to the user's browser. After a few days, if this user visits the website again, cookies allow the website to recognise that same user. Some cookies can also be used to track users across the web and across devices. First-party cookies
First-party cookies are created and stored on a user's web browser when they visit your website. This allows your website to deliver a more personalised and relevant experience when these users return to your website. Third-party cookies
Third-party cookies are created by advertising and tracking providers. These cookies allow marketers to track users around the web in order to better understand their behaviours, habits, and preferences for prediction analysis. They enable marketers to find and talk to the right people, at the right place, at the right time.
Why is Google starting to phase out third-party cookies now?
User privacy is a big part of Google's decision. Ad blockers and privacy tools are now being installed with increasing regularity, and online audiences are increasingly uneasy about advertisers tracking them around the web.
How will this impact your digital marketing?
Following the phase-out of third-party cookies, what disruption should marketers and advertisers expect?
Before we jump into that, it's important to know what areas won't be affected by the third-party cookie phase-out.
Conversion tracking (first-party cookies)
Paid search and paid social conversion tags both use first-party cookies. As a result, there should not be any disruption in tracking standard click-through conversions, so brands and businesses will still get to see how their campaigns performed.
Remarketing (first-party cookies)
Marketers and advertisers will also not experience disruption with RLSA (Google's Remarketing Lists for Search Ads product). Ads that are displayed on the Google SERP (Search Engine Results Page) are based on a user's search query and the actions they take on our websites, which is made possible by a Google cookie.
The same goes for Facebook remarketing. Advertising campaigns on Facebook/Instagram based on actions that users took on our websites are tracked via a Facebook cookie, so again, there's zero reliance on third-party interactions.
Display remarketing (first and third-party cookies)
There will be some disruption to display, native, or paid social advertising campaigns that utilises a robust audience targeting approach across third-party websites. This will make it harder to find new users, generate brand awareness, and personalise ads using the ways of the past.
Tracking view-through conversions and enabling frequency capping (limiting the number of times a user sees an ad) will also likely not function in the way it does today as data from third-party websites will no longer be available.
Can targeted advertising exist without third-party cookies?
When third-party cookies become obsolete, many audience targeting capabilities won't be available in the same capacity as they are now. This will have a dramatic impact on digital marketing campaigns that collect data on what users are doing on different websites.
How will the marketing ecosystem as we know it adapt?
Industry-specific providers such as Adara and other platforms such as Adobe Audience Manager and AdRoll, have announced how they intend to work with Google to identify and target users. This includes working within Google's potential Privacy Sandbox, focusing on onsite personalisation, and using more traditional marketing, including email.
The common denominator among the industry is that programmatic media buyers will need to move away from building audiences on third-party data points.
What to do next
Right now, the best thing to do as a marketer is to continue to stay up-to-date with news related to third-party cookies and other data privacy moves that could impact your business.
If your advertising strategies rely on third-party data, start considering alternatives now. As you continue to follow the news related to the phase-out, you should also check out any software or solutions that can help you better transition away from this type of cookie.
Google's Privacy Sandbox could still serve as a valuable alternative for ad targeting. You could also consider strategies or software that can better help you leverage first-party data.
This would also be a good time to review older strategies, like contextual advertising. While third-party data allowed you to place ads directly in front of people who matched certain user profiles, contextual advertising allows you to circulate PPC ads on websites that rank for similar keywords as your ad. This way, if you're selling sports apparel, your PPC ad could show up on sports-oriented websites.
Finally, to make your brand as safe as possible from future governance or monopoly-related policies, brainstorm even more basic strategies that you can still use to reach your audiences even without cookies, hyper-targeted ads, or mass amounts of data. This will allow you to be less vulnerable to technology, even when you can benefit from the latest tracking software.