Biz Tips: What Will a Cookieless Future Mean for Marketers?

Biz Tips: What Will a Cookieless Future Mean for Marketers?

Biz Tip:

What Will a Cookieless Future Mean for Marketers?

Third-party cookies have fuelled the growth of digital advertising since as far back as the mid-nineties, giving advertisers the unique ability to track people across the web and build robust user profiles based on their browsing behaviour.

These tiny pieces of code are actually small text files with an ID tag and are created when someone visits a website. They are then stored on the user’s browser and are used when that user revisits that same website to remember their preferences, such as login name, themes and other customisation. Crucially they also allow websites to remember things like what pages a user visited on a given site. This is all extremely useful for advertisers because it means they can see which websites people visit and how often, what their interests are, and where they are making purchases. They can then customise, serve and retarget ads based on those behaviours.

This was not the intention of 23-year-old engineer Lou Montulli when he invented the cookie in 1994. While Montulli set out to create a tool that would help websites remember users and improve the e-commerce experience, he did not intend these to be used for cross-site tracking. It was adtech pioneer DoubleClick – later bought by Google in 2008 – that spotted an opportunity in 1995 to use cookies to serve advertising interests.

Amid growing concerns around data privacy in a post-GDPR world, Google is now aiming to phase out third-party cookies from Chrome by the end of 2023. While Chrome is not the first browser to get rid of third party cookies – Mozilla Firefox blocked them in 2019 and Apple’s Safari in 2020 – Google holds around 65% of the global browser market (although this figure is around 80% on average for Europe and the US, as well as other developed countries) so this marks one of the single biggest changes to digital advertising in its history.

Many questions remain over what a cookieless future will actually look like. Here, we’ll examine the impact of a cookieless future on Google Ads and remarketing, and look at how your digital marketing can work without third-party cookies.

What’s changing and how will it impact your strategy?

The removal of third-party cookies from Chrome means Google will stop selling ads targeted to people’s individual browsing behaviours and Chrome will no longer allow cookies that collect data.

Of Google’s vast advertising network, which relies on a mix of first- and third-party cookies, this is going to have the biggest impact on its ad products involving remarketing, marketing to a specific audience (especially YouTube and Display) and measuring the success of campaigns.

Google’s remarketing feature currently allows businesses to customise display ad campaigns for people who have previously visited their site, and then tailor the ads to these visitors when they browse the web and use the apps. This has been a very effective way to encourage someone back to your site to make that purchase or enquiry they were thinking about making.

Without third-party cookies, expectations around how online marketing campaigns are targeted, tracked and measured will need to change completely and marketers will need to find new ways to attribute conversions, frequency cap ad placements and retarget site visitors outside of the Google ecosystem.

However, while it will become more difficult to retarget, this does not signal a definite end to remarketing. Google is not changing any policies around how businesses collect or use data gathered directly from Google-owned products such as Ads and Analytics, so you will still be able to remarket to people using Google’s first-party data within its own tools.

What is FLoC?

Google has explicitly said it will not build alternate identifiers to track individuals across the web once third party cookies are phased out, nor will it use them in its products. It is instead proposing something called ‘Federated Learning of Cohorts’ (FLoC), which is a type of web tracking through ‘federated learning’ (aka algorithms) that groups people into “cohorts” based on their browsing history.

Part of its Privacy Sandbox initiative, Google claims FLoC can provide an “effective replacement signal” for third-party cookies and that advertisers can expect to see at least 95% of the conversions per dollar spent when compared to cookie-based advertising.

Privacy Sandbox includes a proposal (called Fledge) for when marketers want to reach prior visitors to their website via remarketing. This is being considered for a “trusted server” model “specifically designed to store information about a campaign’s bids and budgets”.

Google is also proposing technologies that would allow marketers to measure campaign performance without third-party cookies. Google claims these proposals would protect user privacy while supporting key advertiser requirements, such as event-level reporting that enables bidding models to recognise patterns in the data, and aggregate-level reporting which delivers accurate measurement over groups of users.

However, many of these proposals are still in the testing phase and it remains to be seen whether they will meet the standards of privacy regulations. We also have questions around the effectiveness of advertising via methods of audience expansion, which will cost clients more but deliver less.

What are the alternatives?

There will no doubt be a shift towards building first-party data sets and we will be supporting our clients to incorporate this into their digital marketing strategies.

Owning data about your customers can help you to improve performance and ROI, lead to better accuracy and data quality, and improve measurement and attribution. Email subscriptions, social media, website landing pages and point-of-purchase are just a few of the ways to collect first-party data effectively and consensually.

Contextual targeting may also seem like an appealing option, which is a form of targeted advertising that allows you to place adverts on a website based on the page’s content and keywords. This can be done within Google’s Display network, which automatically serves ads that are relevant to your users, or by partnering with other platforms and publishers.

Some businesses might see an opportunity to bolster their content strategy in the absence of third-party cookies. Publishing quality content helps businesses to cut through the noise and boost organic search. This is a tried and tested way of bringing people to your products/offering naturally.

What now?

Despite what Google says, it is impossible to know how effective remarketing will be within a cookieless internet until the changes are well underway – whenever that may be, given Google keeps delaying the move.

What we do know is that businesses of all sizes – especially those that rely heavily on third-party cookies – will need to unlearn years of remarketing tactics and evolve their strategies to target consumers in a way that fits with a privacy-first internet.

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