Why not all cookies are equal

The cookieless future is coming, but nobody quite knows yet what the digital-advertising ecosystem of tomorrow will look like. One thing is certain, however – advertisers should start considering alternatives. 

The clock is ticking: by the end of 2023 at the latest, Google will withdraw support for third-party cookies in its Chrome browser. In light of Chrome’s approximately 60 per cent share of the browser market, this sounds the death-knell for third-party cookies, not least because Apple already took this step with its Safari browser in 2020. In one-and-a-half years at the latest, a new era in digital marketing will begin: the cookieless future.

However, this is a slight misnomer, as not all cookies will be banished in future. We must distinguish between the different types of cookies involved. In purely technical terms, cookies are the data contained in a file that the browser receives from a website and stores on the user’s device. In addition to essential cookies that ensure a website works properly, there are also cookies that provide certain features on this website to make it more convenient to use, or that measure the performance of the individual website visits. All of these cookies are first-party cookies that are put in place by the respective website and can only be used by the website’s operator. 

By contrast, third-party cookies are provided by separate (third) entities – these tend to be the tracking service-providers used by advertisers. Such cookies allow users to be identified across different domains. This makes it possible to collect valuable information on consumer behaviour and create individual interest profiles, which can then be used for targeted advertising. Fundamentally, online marketing as a whole has relied on these third-party cookies until now. However, their days are numbered.

No one can fully predict what impact abolishing third-party cookies will have on online marketing, though this does not mean that advertisers should adopt a wait-and-see approach. On the contrary: brands should use this time to prepare for, and initiate the transition to, a world without third-party cookies. 

In this context, there are five key aspects to consider:

1. First-party first

Unlike third-party cookies, the changes will hardly affect first-party cookies and identifiers. In principle, a brand can continue to use profile-based metrics and conduct targeted advertising on its own websites. At present, however, the systems required for this are generally still operated by third parties. The key, then, is to make the necessary changes and adaptations to the technical infrastructure in good time.

2. Assess data strategies

Currently, advertisers frequently rely on a first-party data strategy based on pseudonymised identifiers. In most instances, these are – of course – cookies. In order to use these first-party data beyond the advertiser’s own platforms, the data are then transferred to third-party cookies. In future, this bridge will no longer exist. Advertisers must be aware of this and consider in good time how this pending gap can be closed or reduced. Wherever possible, one should try to stop flagging users pseudonymously and instead offer them an appropriate incentive to provide a personalised ID such as an e-mail address, or to register and login. Here too, it is crucial to advance the digital activation of CRM data sets, if this has not already been done. Assuming that users have given their consent, e-mail addresses and login data can then be fed into first-party ID systems in order to once more provide targeted advertising to users across different sites.

3. Evaluate cookie alternatives

There is now a plethora of first-party ID and login solutions available. Many of these will fall by the wayside, while others – such as the solutions provided by the GAMMAs (Google, Amazon, Meta, Microsoft, Apple) – have already been around for a long time. There are huge differences here in terms of the technical possibilities, expected reach, data-protection levels and transparency of the various business models. Advertisers must gain an overview of the different options and then start testing the solutions that are most appropriate to their own business models. We will know whether Google Topics’ interest-based approach is one such solution as soon as the initial tests have been completed. The same goes for the cross-site targeting service that Google intends to offer under the name “Fledge”.

4. Smart data and contextual data

We need to consider alternative targeting approaches that don’t rely on cookies. There are already many innovative solutions available in this arena, and their number is only set to grow. In some areas such as frequency management, they will be unable to replace cookies. However, they could also prove far superior to profile-based solutions when it comes to targeting specific audiences and the possibilities in terms of the data-driven expansion of campaigns across all digital screens.

5. Test, test, test

At the moment, all new targeting solutions can still be measured and validated using third-party cookies. Everyone should make use of this option while they still can, to ensure a smooth transition to the cookieless future.

Author: Tobias Wegmann, Chief Technology Officer at Mediaplus Realtime