What happens to our ads when the cookies go away?

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Online privacy, data protection, and consent are the buzzwords when it comes to online advertising policies in the past few years. Things are changing and cookies are on their way out. So how will the end of cookies change advertising?

Cookies are going away–that’s just the simple truth. We’ve known it was coming for a while now, but it’s officially the end of the cookie as we know it. Google announced it’s phasing out third-party cookies on its Chrome browser by 2022, just last month. Safari and Firefox have already done away with cookies. But with Chrome being the most-used browser globally by a huge margin (over 60% usage), this is truly the final nail in the coffin.

We’ve also talked about the recent changes to iOS 14 that sparked an initial outcry from Facebook, regarding the explicit opt-in policy for tracking users outside the platform. This change will significantly limit the effectiveness of the Facebook Pixel for tracking conversion events. Android is likely to follow suit, so that means all mobile conversion will need some kind of alternative tracking.

These first steps, along with GDPR in the EU and CCPA in California, are marking the end of free-reign digital marketing that we’ve been spoiled with. As marketers, we’ve gotten used to having a wealth of data to target our ideal customers and then track the success of our campaigns in granular detail.

It’s already hard enough to figure out what campaigns are performing best across multiple channels. So when some of these data points go away, how will online advertising change?

We’ll rely more on first-party cookies

While third-party cookies are soon to be a thing of the past, first-party data is going to step up. First, let’s give you a refresher on the difference between first and third-party cookies:

  • First-party cookies are housed directly on your site

They’re often used for basic user data, like enabling users to log in instantly by having their password memorized. They also track user behavior across your site, which you can access with your own CMS dashboards.

  • Third-party cookies come from other sites

This code fires when users come to your site and sends data to another company. These cookies allow users to be tracked across the web, resulting in a more robust picture of their interests.

Skeptics in the digital marketing sphere wonder about Google’s motivations for nixing third-party cookies. Are they just doing it because of public outcry for more online privacy or because it will increase reliance on the Chrome first-party data for advertisers? Since many ad technologies leverage their own third-party cookies, Google will end up padding its own pockets by shutting down a lot of these competing applications and tightening up the market.

However, Optily’s resident Google Guy, Randall Glick, points out, “Google is out to make money and will capitalize on a global shift whenever they can, as long as they can protect their market share and income. They have been working on ensuring that their dominance in the search market will not be negatively impacted by going cookieless.

They have been instrumental in forcing privacy concerns, but never simply out of altruistic motives. That’s simply good business.”

Data will become increasingly anonymized

Federated Learning of Cohorts (FLoC) is a new concept in online privacy. This will group people with similar interests into a like-minded group–or cohort–for advertising purposes.

Individual data would be anonymized, but advertisers would still be able to target groups of people who are in their target audience with a similar degree of accuracy. Google started to test it out in March 2021 in certain markets as part of their Privacy Sandbox initiative.

In last month’s big announcement, Google’s Director of Product Management, Ads Privacy and Trust, David Temkin, commented on FLoC, “This points to a future where there is no need to sacrifice relevant advertising and monetization in order to deliver a private and secure experience.”

In recent news, advertising conglomerate Publicis has signed a deal with ad tech platform Trade Desk. They will join their growing network of over 120 million anonymized user profiles that rely on first-party data.

We’ll start seeing more APIs

What’s an API? It’s short for Application Programming Interface. It’s a go-between piece of software that links two applications together, enabling them to talk to each other.

What this means for marketing, specifically, is that you can link your company server to the ad platforms directly. This then bypasses the browser and their tracking (or lack thereof) entirely.

For example, here is how Facebook’s Conversions API works:

Google backs up its position on supporting a privacy-first online environment saying, its “web products will be powered by privacy-preserving APIs which prevent individual tracking while still delivering results for advertisers and publishers.”

We’ll phase in cookie-agnostic tools

We’ve got at least a year to prepare for a cookie-free world. This means we have plenty of time as marketers to get ahead of the game and start implementing solutions that don’t need third-party cookies to function.

You’ll still be able to use Google and Facebook’s first-party data (and other ad platforms’ too) to track the effectiveness of your campaigns. Google Analytics 4 is already out and cookie-free by design. Keep in mind, you might have some signal loss if you’re not implementing an API, so it’s important to get all your ducks in a row now.

Optily, for example, works with the data you have–if it’s cookie data great, if it’s ad data straight from Facebook and Google Ads, that works too. Since there’s no Optily Pixel, we don’t generate any of our own third-party data. We built our algorithm to work with the signals it gets from the platforms and analytics tools you have access to.

Once cookies go away, there’s no big change to our platform that will need to happen. We’re already miles ahead! Let us know if you want to schedule a demo and try it yourself for 2 weeks.

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