Cookieless World and How Can Marketers Prepare for It?

What are cookies and how do they work?

Cookies! No, not the delicious chocolate chip kind, but the tiny pieces of data that websites store on your device. They’re like the digital footprints that help websites remember you, making your online experience smoother. For instance, ever wondered how a website remembers your login details or the items in your shopping cart? That’s cookies at work.

First-party cookies vs. third-party cookies: what’s the difference?

Let’s break it down in simple terms:

First-party cookies: Imagine you walk into your favorite cafe, and they remember exactly how you like your coffee. That’s what first-party cookies do. They’re created and stored by the website you’re directly visiting. They remember your preferences, ensuring the site functions just right for you.

Third-party cookies: Now, imagine you’re still in that cafe, but someone from the shop next door comes in and offers you a discount coupon for their store. That’s a bit like third-party cookies. They’re set by domains other than the one you’re visiting, often by advertisers to track your online behavior across different websites. This is how you might see an ad for a product you were just looking at on a completely different site.

How are cookies used in advertising and marketing?

Cookies play a starring role in the digital marketing show. They help marketers understand user behavior, preferences, and even the kind of content that resonates with them. Here’s a quick rundown:

1. Personalized user experience: Ever noticed how some websites seem to “know” what you’re interested in? Or how do they load the content based on your location? That’s cookies helping sites tailor content just for you.
2. Ad targeting: Those shoes you checked out but didn’t buy, and now they’re following you everywhere online? That’s third-party cookies helping advertisers show you relevant ads based on your browsing history.
3. Performance analysis: Marketers love to know what’s working and what’s not. Cookies provide insights into which ads get clicked, which emails get opened, and which content gets the most love.
4. Optimization: By understanding user behavior through cookies, marketers can optimize their strategies, ensuring they’re not just shooting in the dark.

Why are cookies disappearing?

Here’s the twist in our cookie tale. 

The digital marketing landscape is evolving rapidly due to privacy concerns and regulations. With browsers like Safari and Firefox already blocking third-party cookies and Chrome, which holds a whopping 52.3% of the US browser market, planning to join the party by 2023, the cookie game is changing.

Cookies have been the backbone of digital advertising for years. But times are changing, and so is the cookie game. Why? Well, for starters, a whopping 81% of Americans are worried about how websites use their data. Yet, interestingly, 43% just hit that “accept all cookies” button without a second thought.

But it’s not just about user sentiment. Regulatory bigwigs are stepping in. Think GDPR in Europe and CCPA in sunny California. These regulations are all about giving users more control over their personal data. And let’s be honest, cookies, especially the third-party ones, don’t exactly fit this new mold.

Plus, trust is a big deal. With cookies tracking our every move online, that trust started to wane. Users began feeling like they were constantly under the digital microscope. Not cool, right?

Enter Google’s Privacy Sandbox and Federated Learning of Cohorts (FLoC). It’s aiming to replace those pesky third-party cookies with something a bit more privacy-friendly. The idea? Group users into cohorts based on similar browsing habits, share online interests and behaviors. Here’s how it works: 

1. When you browse the web, Google’s FLoC technology analyzes your browsing habits and identifies common themes or interests.
2. It then groups you into a “cohort” with thousands of other people who have similar interests based on their browsing habits.
3. This cohort is not tagged with any personal identifiers but rather with a shared interest, such as gardening or travel.
4. Advertisers can then target ads toward your cohort based on these shared interests without knowing your individual identity or browsing history.

Ironically, when I used an extension called Awesome Cookie Manager to check how extensively Google uses cookies on my browser, it turned out that quite a bit, actually:

Maybe they are preparing for FLoCs?

This development is important for the industry as it offers a fresh way for optimization and finding solutions that respect user privacy while still delivering relevant content and thus helping businesses to stay relevant for their respective audiences. And here’s the latest scoop: starting in early 2024, Google’s planning to shift 1% of Chrome users to this new system, turning off third-party cookies for them. The grand finale? A complete farewell to third-party cookies in the latter half of 2024.

So, in a nutshell? It’s a mix of privacy concerns, regulatory changes, and tech innovations pushing us towards a cookieless future.

This shift towards a cookieless world is making waves in the marketing ocean. It’s like taking away a marketer’s magic wand. But fear not! Just as marketing survived and thrived before the digital age, it will find a way to navigate this new challenge. After all, change is the only constant, right?

So, as we sail into this cookieless future, it’s essential for marketers, especially those just starting their journey, to understand the changes, adapt, and find new ways to connect with their audience. Because at the end of the day, it’s all about creating genuine, meaningful connections.

What does a cookieless world actually mean?

As we sail into this new digital horizon, it’s essential to grasp what a world without third-party cookies looks like. For consumers, it’s about privacy. For marketers, it’s a new playbook. Let’s dive deeper.

For consumers

For the everyday web surfer, a cookieless world might sound like a tech jargon-filled mystery. But it’s simpler than it sounds. Imagine browsing your favorite online stores, reading blogs, or watching videos without someone constantly peeking over your shoulder. That’s the essence of it. More privacy, fewer ads that eerily know exactly what you were thinking of buying. Plus, you get a boost in online security, as there’s less risk of your data being misused. And let’s not forget the speed! Without cookies tracking every move, your browsing could be faster and smoother. It’s a significant optimization, a win-win for a more relaxed and efficient online experience. But here’s the trade-off: while you’ll enjoy more privacy, you might have to wave goodbye to some of that hyper-personalized content you’re used to.

For marketers

Alright, marketers, brace yourselves. A cookieless world is a bit like sailing into uncharted waters. Those third-party cookies? They’ve been your trusty compass, guiding your digital advertising strategies. But with giants like Google planning to end third-party cookie support by 2024, there’s a bit of a storm brewing.

Here’s what you’re potentially missing out on: precise targeting and retargeting capabilities. Those cookies were like little informants, giving you insights into user behavior and preferences. Without them, it’s like trying to hit a bullseye blindfolded. You might lose some of that laser-focused precision. On the bright side, you’ll gain an opportunity for more authentic connections and a chance to stand out in a sea of generic ads.

The challenges of going cookieless

The digital realm is undergoing a seismic shift. Third-party cookies, once the linchpin of online advertising, are on their way out. 

But it’s not all doom and gloom. This is a chance to pivot, to innovate. Think permission-based email marketing and opt-in vs opt-out strategies. It’s about building genuine relationships with your audience, not just tracking their every move.

And here’s some food for thought: high-growth brands are already leading the way. A significant 61% of them are shifting to a first-party data strategy. They’re using this data to deliver personalized content and serve up ads via programmatic media. 

So, while the cookieless future might seem daunting, it’s also an opportunity to rethink, adapt, and come out stronger. Let’s unpack what this means.

Cookieless advertising: what are you losing out on?

As we transition into a cookieless world, the stakes are high. According to a McKinsey analysis, up to $10 billion in US publisher revenue is at risk due to the phasing out of third-party cookies. This significant financial implication underscores the challenges marketers face. So, what exactly are advertisers potentially losing out on in this new landscape? Let’s delve deeper. 

Attribution

This is a fancy way of saying that tracking a customer’s journey across multiple platforms and touchpoints becomes a Herculean task. If a user sees an ad on their mobile device, and then later makes a purchase on their desktop, connecting those dots in a cookieless world is challenging.

Digital identity

Remember the times when you could craft a detailed profile of your website visitor based on their browsing habits? Those days are numbered. With the demise of third-party cookies, creating a digital identity for users is like trying to paint a portrait with half the colors missing.

Ad targeting

Targeted ads are the bread and butter of digital marketing. But without third-party cookies, it’s like shooting in the dark. The granular data that allowed for hyper-specific targeting will be a thing of the past. Instead, marketers will need to rely more on broader cohorts, like those proposed in Google’s Privacy Sandbox, rather than individualized targeting.
How much detail gets lost? Well, it’s like comparing a group photo to a close-up selfie. A cohort of everyone who checked out a website in the last week is like a group photo – you see the crowd but not the individual faces. But even a super specific cohort, like everyone who bought the same sneakers, is still less detailed than those up-close-and-personal cookie insights.

Loss of deeper analytics

In the golden age of third-party cookies, marketers had access to detailed data. They could see which websites users visited, which products they looked at, and how long they stayed. But as we move towards a cookieless future, this data becomes more generalized. It’s like trying to read a book with half the pages torn out.

Decreased access to data sets

Data is the lifeblood of digital marketing. But with the end of third-party cookies, the rich data sets that marketers relied on are drying up. This means they’ll need to be more creative and strategic in gathering and using data.

Strategies for a cookieless future

The digital landscape is shifting, and with the phasing out of third-party cookies, marketers are at a crossroads. But fear not! A cookieless world doesn’t mean the end of effective marketing. It’s an opportunity to adapt, innovate, and build stronger relationships with your audience. Let’s explore some strategies to thrive in this new environment.

Leveraging data in a new environment

In the absence of third-party cookies, data becomes the lifeblood of digital marketing. But where do you source this data, and how do you use it effectively? The answer lies in understanding and leveraging the data you already have and finding innovative ways to gather more.

• Collect data directly from consumers: First-party and zero data is gold in the new digital age. By collecting data directly from your customers, you gain insights that are more relevant and actionable. Remember, this data reflects how they engage with your brand, their preferences, and their purchasing behavior. First-party data is anything you collect from user interactions ( start by sending out surveys or feedback forms to your customers). Zero-party data is information consumers willingly share with brands without the brand asking directly: think creating a playlist of your favorite music on Spotify or creating a wishlist on Amazon. It’s like having a digital chat where you learn about their preferences and desires. Encourage them to sign up for emails on your website, offering them tailored content and insights into what grabs their attention. Consider launching a loyalty program, which is a fantastic way to reward your customers while gaining insights into their purchasing habits, and the list goes on.
• Gated content: Offering valuable content in exchange for user information is a tried and tested method. Whether it’s an insightful whitepaper, an exclusive webinar, or a discount code, gating content can encourage users to share their details willingly.
• Invest in future-proofing the controls of consumer data: With increasing concerns about data privacy, it’s essential to give consumers control over their data. Implement systems that allow users to manage, update, or delete their information. This not only builds trust but ensures you have the most up-to-date data.
• Use alternative identifiers: With the decline of third-party cookies, alternative identifiers like universal IDs (UIDs) are gaining traction. These unique user IDs, often based on email addresses or device-level data, enable companies to track users across different websites and devices, providing a more seamless and accurate tracking method. However, it’s important to note that UIDs have their limitations. They rely on consumer actions, such as providing an email, and can’t track users across multiple domains like cookies. Also, the UID market is still developing, with many vendors offering different solutions and lacking standardization. 

Adapting to new technologies and (old) methods

The tools and tactics of yesterday might not work in the cookieless future. But that doesn’t mean we’re starting from scratch. By blending new technologies with tried-and-true methods, marketers can find effective ways to reach their audience.

• AI, ML, Unified Measurement, and Federated Learning of Cohorts: Harness the power of Artificial Intelligence and Machine Learning to analyze vast amounts of data and derive actionable insights. With tools like Google’s Topics API, marketers can categorize sites people visit into various topics, ensuring relevant ad placements without compromising user privacy.
• Automation: In a fast-paced digital world, automation is key. From sending out personalized emails to segmenting your audience, automation tools can streamline processes and ensure you’re reaching the right audience at the right time. Think of it as having a digital assistant that sends out personalized emails, segments your audience, and even manages your ad campaigns. Here’s what you can do: start by setting up automated email campaigns that trigger based on customer actions, like a welcome email when someone signs up. Use tools that segment your audience based on their behavior or preferences, so you’re always hitting the right note. And don’t forget about automated ad bidding and targeting. With automation, you’re not just saving time, you’re making every marketing move count.  
• Return to contextual advertising: Remember the days when ads were placed based on the content of a page rather than user behavior? It’s making a comeback. Contextual advertising focuses on placing ads in relevant spaces. For instance, an article about hiking might feature ads for hiking boots. However, while writing this article I came to the conclusion that many businesses are not fully embraced with strategy. I browsed the internet with AdBlocker off for an hour and all I could see were retargeting ads, that are still utilizing cookies.

Building trust and transparency with consumers

In a world that’s increasingly concerned about privacy, trust becomes a currency. For marketers, this means being transparent about data collection practices and ensuring consumers feel safe and respected at every touchpoint.

Creating better Privacy Policies and being transparent: Make sure your privacy policies are clear, concise, and easily accessible. Let your audience know how their data is being used and give them the tools to control it. Building trust is not just about compliance; it’s about showing your audience you value and respect their privacy.

And these are just a few ideas to implement. By embracing these strategies, marketers can navigate the challenges of a cookieless future and continue to deliver impactful campaigns. Remember, it’s not about clinging to old methods but about adapting and finding new ways to connect with your audience. The future might be cookieless, but it’s still sweet for those ready to adapt.

Final thoughts

Navigating the impending cookieless future requires adaptability and a renewed focus on genuine connections. Here are the essential takeaways for marketers:

1. Prioritize first-party data: Direct interactions with consumers are now gold. Harness this data for more personalized marketing.
2. Build consumer trust: Clear communication and transparent data practices are paramount in this new era.
3. Use new technologies: Embrace AI and ML to derive insights without compromising user privacy.
4. Revisit traditional strategies: Techniques like contextual advertising remain relevant, proving that core marketing principles endure.
5. Genuine connections matter: In a world prioritizing privacy, authentic relationships based on mutual respect are key.

In essence, while the cookieless future presents challenges, it’s an opportunity for marketers to innovate, adapt, and forge deeper ties with their audience.