How the Cookie Crumbles

It’s impossible to go anywhere, read anything or talk to anyone in the marketing industry without some question popping up about the impact of the disappearing cookie. Back in January, Google announced that, beginning in early 2022, third-party cookies will no longer be allowed in its owned web browser (Chrome). Queue the panic.

Or not. First off, third party cookies were cut out from Firefox and Safari awhile ago, so there have been some good learnings from that 25% of digital user base since then. But the more recent news from Google spurred knee-jerk reaction pieces that have been short on details… and long on hysteria. Considering this is still two years away, the loss of the cookie might not even be a complete disappearing act. There is still time to innovate and create viable alternatives. So with the benefit of time, direct conversations with Google, as well as other experts in the industry, here’s how it MIGHT impact us:

A Tip of the (Frequency) Cap

Brands (and their agencies) create media plans based on target audiences. They are set up based on how many times they want each audience to each to see different variations of ads. The measurement and counting is done with cookies that send back a signal every time the ad is shown to an individual user. Once the pre-set maximum number is reached and target exposure is achieved, the ad is no longer shown to that user. You can no longer determine whether an individual has seen an ad no times or too many times. We call this frequency capping, and it’s days might be numbered.

So… is this good or bad? Well, as always, it depends on the ad. Is it relevant? Is it informative or entertaining? Compelling you to want to take an action? But, more likely than not, this is bad for the user. Most ads are not relevant to most individuals. So what if you are now the individual who sees the same irrelevant ad aver and over again? The onus is now on the creative team to make ads that are broadly good enough for everyone, while still achieving the desired outcome. Good luck.

Targeting? Yes. Re-targeting? No.

You know how you might visit a website while looking to learn more about a bathing suit or shade of lip stick and then see an ad for that SAME PRODUCT all over your computer, phone, ipad and even in your gmail inbox? That entire technology, which some people find creepy (consumers) and other people find incredibly effective (marketers), is called re-targeting. And it goes away when the third-party cookie disappears. The way it works now, advertisers works can drop a cookie into your browser upon visiting a page. A third-party can then use that cookie to serve you an ad later on, even on other websites.

Same question as before: is this good or bad? Let’s be honest: most consumers will be glad to see this go away, and marketers may see it as a big setback. But… What if you just ordered something online, via a product site or Amazon… yet you still see ads for that product, or even a cheaper alternative to that product. Either way, you’re probably annoyed. That DOESN’T happen now because of, you guessed it, third party cookies. Advertisers currently rely on the cookies to help them understand who NOT to serve ads to. Without the ability to switch off the campaign for those who purchased, the loss of the cookie creates a more negative experience for everyone in this scenario.

Post-view Conversion Goes off the Tracks

When marketers launch performance-driven conversion campaigns, the partners and media platforms they use typically work on a “post-click” and “post-view” conversion window. In plain English: When you see an ad, the ad drops a cookie in your browser as a signal that you’ve seen it. If you then go on to buy the product or take some other desired action, the company that served you the ad you viewed gets a credit for the sale (even if you didn’t actually click the on the ad, itself). Without third party cookies, it will be impossible to count these post-view conversions. Anyone who works in attribution modeling is either going to be very rich… or out of a job.

Interest and Demographic Targeting

Many companies share data about individuals socio-, geo- and interest- graphic details. Things you search for, websites visited and the referral / exit traffic information. These companies can then help advertisers serve more relevant ads based on the things in which you might be most interested or find most relevant. Same holds true with sites here you might have shared age or gender, and then include you in an audience segment for other advertisers to target ads. You might like to see these ads. You might not. Either way, with the end of third party cookies, this will no longer be a possibility.

Okay, so what CAN we do?

We’ve already talked about content as a solution. But also consider better context. Contextual targeting means showing relevant ads in and around similar topical content. This might mean an airline or hotel ad when you’re reading a travel article. But this is not currently easy to plan or manage, and the margin of error is, well, high. It is currently quite challenging to categorize much of the content with which we interact – news, sports, streaming shows, mindless YouTube videos, etc. However, topical, publication-based content might just be relevant and valuable again…

For now, that leaves us with getting smarter with using first party cookies. There is absolutely nothing stopping brands from leveraging first party cookies to remember who you are when you go back to visit their websites. So if a brand is using Google software to buy ads on YouTube, they can still cap the frequency of the ads that you are seeing. Also true if you buy ads on Facebook through their self-service platform.

More than anyone else, the impact will be biggest for the media buyer. But considering how easy a ride many of them have had over the past decade, it’s nice to put a challenge back in their laps. Meanwhile, some of the biggest global companies and most visited websites – think Walmart, Target and the like, are already getting out in front of the impending changes, running tests to transact based on their own first party data. Similarly, many publishers, including those in the webedia network, are working without using cookies.

Things WILL Change.

This much is certain. The entire business of programmatic media is based on the third party cookie. GDPR and CCPA have ignited compliance-related changes, but most platforms built within the last 15 years have cookies at the foundation of their model. There is time to go back and re-work things, but it will mean a fundamental architectural shift. Newer DSPs (Demand-Side-Platforms) are being built on a single-tenant infrastructure, and in an identity-agnostic way that does not rely on legacy cookie technology. This enables buyers to buy based on their own IDs or against their own objectives, through custom algorithms using signals based on the inventory under consideration.

If you’re a brand, ask your agency partners how they’re currently set up (if you don’t already know), and make sure you don’t wait until it’s too late to start planning for a different future.

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