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Jun 07
Third-party cookies - what are they, what’s happening & what to do

Third-party cookies – what are they, what’s happening to them, & what to do

Digital advertising is about to go through a systemic shift in the next six months. Before we know it, the deprecation of third-party cookies will be here.

To deliver success in 2021 and beyond, marketers need to start thinking about their targeting and measurement solutions without third-party cookies now so you can test and learn. Before you get there, it’s best to understand what is happening. To help you along, we’ve gathered all the details about third-party cookies together so you can know what they are, what’s happening to them, and what to do.

Jump to:

What are third-party cookies?

What is happening to third-party cookies?

So why are third-party cookies going away?

Checklist on what to do about third-party cookies

What are third-party cookies?

Third-party cookies are tracking codes/pixels that are placed on a website visitor’s browser before visiting another website. When a website visitor comes to your site and others, the third-party cookie tracks this information and sends it to the third-party who created the cookie — which might be you as a marketer through your demand-side platform or data management platform.

As a marketer, the third-party cookie data allows you to better understand your website visitor’s behaviors, such as websites they visit, recent purchases, and interests shown on various websites, which enables data targeting and retargeting and visitor insights.

While third-party cookies are placed in a visitor’s browser automatically, users (as well as the ad tech industry) are pushing for more control and transparency of any consumer data.

What is happening to third-party cookies?

If you’ve followed any marketing or advertising industry news, the topic of the end of third-party cookies isn’t new.

In February of 2020, a Google blog post announced the phaseout of third-party cookies and gave initial reasoning for the pivot. Google explained that this move meant to protect users who were asking for more privacy. It’s important to note that Firefox and Safari had already phased out the third-party cookie months ago. Google’s post said that these changes would happen over the course of two years, which is to allow the industry to prepare and ensure that this pivot doesn’t destroy the online advertising business.

This timeline is a big deal. Even though other browsers have blocked third-party cookies, Google Chrome makes up 56% of the web browser market in the United States and accounts for more than half of all global web traffic.

This announcement has prompted a wide variety of solutions that could “replace” third-party cookies. These include:

  • Universal IDs: Universal or unified IDs, which are solutions provided by LiveRamp and The Trade Desk, offer a common identifier for users on desktop and mobile web. This identifier, most likely to be an email address, can be used by any vendor in the ad tech industry in a privacy-safe way. Learn more about Universal IDs here.
  • Publisher first-party data: Since digital advertising powers many publishers, we should see that publishers’ first-party data will become increasingly more valuable as third-party cookies phaseout. Publishers able to activate first-party data, like email lists, on their inventory will leverage this information to help advertisers target their audiences. Learn more about publisher first-party data here.
  • The Privacy Sandbox: The Privacy Sandbox is a Google-backed project with the focus of “creating a thriving web ecosystem that is respectful of users and private by default.” Right now, there aren’t any concrete solutions for replacing third-party cookies besides FLoC and FLEDGE, which are more based on cohorts. Learn more about the Privacy Sandbox here.
  • Project Rearc: Spearheaded by the IAB, IAB Tech Lab, governmental, and other industry/consumer organizations, Project Rearc aims to re-architect digital marketing in a way that balances privacy and personalization. Learn more about Project Rearc here.

So why are third-party cookies going away?

With the passage of GDPR, CCPA, and more attention on privacy protection, it shouldn’t come as a surprise that consumers want better understanding and transparency into data collection methods.

Also, these changes are meant to happen any time now as the third-party cookie was already weakened by Safari and Firefox’s adblocking. As the industry continues to grow, marketers are increasingly focused on building trust with consumers.

The hope is that ending the support of third-party cookies will usher the industry forward toward solutions that provide users with greater transparency and privacy management.

What is the impact of third-party cookies on digital advertising?

First things first, don’t panic.

At this point, marketers, advertisers, and data engineers alike are actively looking for solutions to determine what will happen 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 marketing strategy.

Checklist on what to do about third-party cookies

So, now what? The disappearance of third-party cookies doesn’t mean an end to targeting and measurement; it just means what and how we target and measure will change. And that’s okay.

Here are a few things you can do now to prepare:

  1. Own your own data. Now more than ever, it is increasingly important to invest in ownership and mastery of your first-party customer data. Getting there means you need to build processes to collect customer data and consent from your customers and prospects.
  2. Contextual targeting. Just because third-party cookies are going away doesn’t mean you don’t need to have a targeting strategy. Contextual targeting, like keyword, site, or category targeting, can ensure you’re reaching users who are actively engaging with content tied to your brand.
  3. Alignment to partners. Now is the time to start asking questions from your partners to ensure you are in the best position moving forward. A few questions to ask are: how are they preparing for the end of third-party cookies, what types of targeting tactics are available, do they use AI or data science to collect targeting data, and how do they handle data privacy.

It’s a lot to navigate — but the phaseout of third-party cookies will eventually be a boon to the digital advertising industry. We’re well prepared already — now we just need to evolve our marketing tech stack to reflect the opportunities of this new era!

About the author:

Megan Sullivan-Jenks is director of marketing & communications at Choozle – Easy Digital Advertising®. A self-proclaimed tinkerer, Megan’s a problem solver for marketing and advertising strategies and execution. From nonprofits to consumer goods and software, she’s an expert at creating online and offline marketing & communications strategies that are engaging and results-driven. Outside of the office, Megan rolls up her sleeves to enjoy all things DIY like sewing and woodworking.

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