In the wake of data privacy regulations and multiple web browsers announcing they will stop supporting third-party cookies, the death of the cookie in digital marketing begins. Read on for insights into what digital marketers need to know and what they can expect in a post cookie world.

That’s the way the cookie crumbles

In January 2020, following in the footsteps of Apple Safari and Mozilla Firefox, Google announced its plan to begin phasing out cross-website cookie tracking on its dominant browser, Google Chrome. This was in response to growing data protection regulations including GDPR and increased user demand for greater privacy, choice, and control over the use of their data. This is a significant change, as Chrome commands an estimated two-thirds of the web browser market.

Google’s cookie replacing solutions

In place of third party cookies, Google plans to introduce new solutions that do much of what cookies do but make the internet a less “irritating and invasive” environment than today’s web ecosystem. Instead of individual tracking and targeting, the new ad targeting technique, Federated Learning of Cohorts (FLoC), groups individuals together with similar generalised interests. The company states the new technique is 95% as effective as individual targeting. However, Google hasn’t given much insight into their solutions and the shift from tracking to profiling has raised concerns about new privacy issues and potential discrimination.

The death of the cookie can be beneficial for the industry

The death of the cookie is not necessarily a bad thing. Many commentators such as Mark Wagman of Media Link suggests digital marketing will achieve more effective business outcomes by shifting their budget away from hyper-targeting and paying more attention to content and context. Doing more branding and targeting a small number of basic parameters will enable brands to create lasting relationships with customers. Additionally, studies have shown how data from third-party cookies is of poor quality. One study showed the accuracy of targeting gender using third-party data is 42%, which is worse than using no targeting at all.

While this won’t be easy, this cookie-free, mobile ID-light shift has the potential to be better for brands, better for publishers and best of all, better for consumers. We’ve been given an opportunity to reboot – this next era of data-driven digital has an opportunity to be what we all told ourselves was happening today.

Writing for WARC’s Marketer’s Toolkit 2021, Mark Wagman, managing director at MediaLink

First party data is the new secret ingredient

Brands and media owners who prioritise first-party data strategies can offer customers unique offerings such as tailored experiences and exclusive content, allowing them to boldly differentiate from competitors. As consumers demand more ethical practices regarding their data, the move away from third-party cookies will give digital marketers the opportunity to address the tension between personalisation and privacy by providing relevant, yet unobtrusive, open web advertising to customers. This, in turn, is likely to increase trust levels in the digital ecosystem.

Brands need to start preparing for the new era of digital marketing

Brands have relied on tracking cookies to understand consumers and serve them relevant ads since the late 1990s. According to Procter and Gamle CMO Marc Pritchard, the future of marketing is mass personalisation based on first-party data. Brands need to start creating new solutions to reach their target audience using first-party data. By using a test-and-learn methodology before cookies are phased out completely, brands can establish benchmarks against which to measure new techniques.

Fitbit and their results

Fitbit has recently demonstrated its preparation for a cookie-less world. The electronics and fitness company ran a digital campaign test aimed to discover if they can receive strong results without the use of cookies. It focused on new ways of identifying audiences using authenticated audiences (consumers who had given permission to use their data) and compared the results with a typical approach using cookies. The results showed a doubled return on ad spend and a 13% higher average order value compared with the cookie approach.

Read more about the future of digital marketing here!

References

• https://www.theverge.com/2021/3/3/22310332/google-privacy-replacing-third-party-cookies-privacy-sandbox
• https://www.forbes.com/sites/augustinefou/2020/09/10/how-accurate-is-programmatic-ad-targeting/?sh=5f4eba792523
• https://www.warc.com/newsandopinion/opinion/stop-chasing-cookies-and-start-creating-customers/3945
• https://www.thedrum.com/news/2020/01/21/marc-pritchard-evaluates-the-next-10-years-the-pg-brand
• https://www.warc.com/newsandopinion/news/fitbit-campaign-prepares-for-demise-of-online-cookies/43981