How to Prepare for the Demise of Third-Party Cookies
Don't get caught with your hand in the cookie jar. It's time to cash in your chips and prepare for the demise of third-party cookies.
Almost 30 years have passed since ad platforms began placing third-party cookies on a user's device – essentially launching the age of digital advertising. Unlike first-party cookies which are set by a publisher's web server, third-party cookies are placed by an AdTech vendor and users are then tracked across multiple sites.
This technology brought about the advent of retargeting ads. We all have had the experience of searching for a product, and then later receiving a digital ad for that same product – enabled by third-party tracking cookies.
Although retargeting ads are loved by advertisers because they provide the ability to directly attribute ads to revenue, consumers have not been as enthusiastic. In fact, data privacy concerns have spurred a push for Google Chrome to end the use of third-party cookies, which were already eliminated by Apple Safari and Mozilla Firefox. Google Chrome, which has a 65.8 percent share of the market, originally planned to deprecate third-party cookie use in 2022 but rolled back the plan in order to support businesses and allow them time to adequately prepare for the transition.
Beginning in early 2024, Google plans to disable third-party cookies for 1 percent of Chrome users and migrated them to a Privacy Sandbox. This will allow developers to test and simulate third-party deprecation which is on track for the second half of 2024, according to TechCrunch.
The Transition from Cookie-Based to People-Based Marketing
In walled gardens such as social media, consumers are logged in, facilitating targeted and personalized advertising. Open-web publishers can follow this strategy, as the portion of their traffic that is authenticated can be treated the same way. The publishers are finding improved monetization in authenticated marketplaces, giving them an incentive to find ways to improve the log-in rate.
Deepening Your First-Party Data Relationships
First-party data refers to information companies collect with the customer's explicit permission. The value of first-party data lies in its ability to enable personalized experiences and empower data-driven decision-making. Brands that can build a scaled first-party database across customers and prospects can then reach these audiences in both the walled garden apps and the authenticated traffic marketplace on the open web.
Like any relationship, a first-party data relationship needs time and trust to nurture and grow. Some ideas to move your users through the relationship funnel include providing a sign-up for a newsletter, sending an alert when a desired product is back in stock, and providing the opportunity to create their own wish list, as explained by LiveRamp.
Companies can do this by garnering trust by ensuring that the correct individuals are being targeted and that they are being sent relevant messages. For publishers, invest in valuable experiences to give users a reason to log in.
Marketing Uses for First-Party Data
Ad Targeting
Precisely reach your customer through personalized ads at the right time in their purchase journey. Channels include digital, social, and CTV.
Audience Suppression
Have you ever received an ad from a company for a product you already purchased? Building an audience suppression file can help you prevent that annoying event from happening to your customers. It can also suppress ads from customers for which they are not relevant, helping to build trust.
Look Alike Modeling
Did you ever want to clone your best customers? Predictive modeling can analyze your first-party data and help you reach customers that have the same traits and behaviors as your highest-performing customers – increasing your prospects and growth potential.
Authenticated Users – the Person versus the Cookie
In a recent webinar, Steven Goldberg, VP of North American publishers at LiveRamp, and Todd Dziedzic, SVP of digital and analytics at Porch Group Media, reported on strategies for creating authenticated users. Goldberg stated, "Our studies have shown that an authenticated user far outweighs a cookie user in terms of both the CPM side a publisher would receive and also on the ROI an advertiser would receive."
What Should You Look for in an Identity Solution?
- High Quality: Provides match accuracy so you are reaching the correct consumer.
- Speed: Allows a quick match process.
- Easily Connected: Allow a single integration to access the ecosystem.
- Neutral and Interoperable: Connects to the whole ecosystem.
- Privacy-Centered: A reputable company that is compliant with all privacy laws in addition to maintaining privacy between the publisher and advertiser.
- Flexible: Can be used by different partners and is flexible in providing different reporting results depending on client needs.
- Scalable: You obtain the numbers to execute the campaigns you want to.
KPIs to Focus On
- Total Targeted In-Market Shoppers
- Total Impressions
- Shopper Matches
- Units Sold
- Total Gross Revenue
- Revenue by Month
- Breakdown of sales and leads associated with all campaigns
- Sales by Individual Campaign
With the deprecation of third-party cookies, media networks, paired with first-party audience solutions, provide marketers with the ideal set of tools to build a full-funnel path to purchase and boost brand loyalty by optimizing the shopping experience.
A media network allows you to choose from a broad range of advertising solutions across offline and online channels, including email, direct mail, CTV, and full-service social and display advertising.
With the absence of third-party cookies, brands need another method to show the lift and impact of their advertising spend. Dziedzic stated, "The deprecation of third-party cookies has fast-forwarded the movement to measure spend in the digital space.... whether that's programmatic or one of the social apps....to matching on sales attribution vs. last touch or who went to the site, etc. Some of the disruption of cookies has changed those KPIs altogether and pushed to [a model] that you can control, like PII matched to sales – and matching that to the audience you are spending against, to get a more consistent and truer ROI."
Work with a reputable audience and marketing solutions provider who has the tools to measure the performance of an acquisition campaign by matching client sales data back to the targeted audience. It also allows you to track the number of digital/social impressions and click-throughs by campaign.
The views and opinions expressed are solely those of the contributor and do not necessarily reflect the official position of the ANA or imply endorsement from the ANA.
Larisa Bedgood is VP of marketing from Porch Group Media.