Understanding Implications of the Cookieless Future

Google’s announcement that Chrome will no longer support third-party cookies as of 2024 has many digital marketers concerned about their cookieless future. Marketers that have historically relied on cookies to reach their target audiences and measure success will be greatly affected by this change. Many are actively working on the next steps to avoid campaign performance declines. The actions taken by marketers in this pre-cookieless environment will help define the future of targeted advertising and performance metrics.

“Businesses and advertising professionals will need to better understand how customers make decisions, what actions are valuable for businesses and bring that all together when showing success.” – Maggie Gotszling

Why Are Cookies Important And How Do They Work?

Cookies are a backend line of code on a website. They help advertisers track a user’s behavior across the internet and include 3rd party tracking pixels from platforms such as Facebook. Tracking these activities makes it possible for advertisers to effectively deliver ads to their target audiences and directly measure and attribute conversions. With the deprecation of cookies, that tracking will no longer be viable, effectively blinding some targeting and measurement capabilities on which many marketers currently rely.  

What Does It Mean For Campaign Targeting Strategies?

The major impact will be on retargeting third-party cookie-based audiences. It is recommended that advertisers begin shifting overreliance on this tactic and begin testing alternative targeting options to fill the gaps. Gathering first, second, and zero-party data will be central to an effective digital market strategy in a post-cookie environment. Additionally, contextual targeting does not rely on cookies and provides brands with a strong opportunity to generate increased brand awareness when done strategically. As an additional benefit, the cost of contextual advertising is typically substantially lower than addressable impressions as data. However, costs depend on whether you are activating through a whitelist or a private marketplace deal.

Cookieless ID-Based Solutions For Targeting And Measurement

There are also multiple cookie alternatives in development that promise to bridge the addressability gap when cookies are deprecated. Here are a few of the options currently out there or in development.

Google’s Topics:

Google is developing a solution for targeting called Topics. Topics uses an individual’s browsing activity to tag them with broad interest categories. For instance, if a user visits Nike’s website, they may be tagged with an interest in fitness.  When ads are served to this user, their browser will randomly choose three of that user’s top five topics based on the previous three weeks’ browsing history. Those three topics are then shared with the advertiser to serve relevant ads to the user during their visit. This method allows the advertiser to target based on interest without using identifiers or other potentially invasive data points.

Standard Universal IDs: 

Originally used as a way to combat mismatched data when syncing cookie data across domains, companies like The Trade Desk, LiveRamp, and IAB have developed Universal IDs. This standardized identifier allows advertisers to buy into a community of shared data to track audience activity across the internet. The primary concern with Universal IDs, however, is that they still currently rely on third-party cookies, without which they are unable to set or recognize identifiers across domains. 

Encrypted Universal IDs:

Understanding the original design of Universal IDs would no longer be effective once cookies were deprecated, companies like The Trade Desk (Unified ID 2.0) started developing encrypted identifiers using email addresses instead of cookies to track user activity. The primary hurdle with email-based IDs is they require users to provide the same email across websites in order to build an accurate profile. If the user is unwilling to provide that data, or uses different emails for different sites, advertisers will be blind to their activity and be unable to target them accurately.

While all of these solutions have their pros and cons, they are worth monitoring as they continue to develop. They will be key in building targeting and measurement strategies in 2024 and beyond. 

Recommendations to Prepare for the Cookieless Future

• Plan early & anticipate impacts to your measurement/attribution system. 
• Benchmark your current performance. 
• Apply business intelligence models to your analytics. 
• Expand implementation timelines. 
• Create new relationships with third-party, cookieless data providers. 

“Brands who have been targeting super-niche audiences will have to reestablish expectations for programmatic and be open to experiment with alternative targeting and measurement solutions.” – Colin Duft, Account Strategy Director