Third-Party Cookies and Digital Marketing: What’s Next?.
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Third-Party Cookies and Digital Marketing: What’s Next?

Since arriving on the digital marketing scene in the mid-90s, cookies have remained an integral tool for understanding their customers. However, evolving public expectations for user data privacy have catalyzed a shift away from the use of certain cookies — specifically, third-party cookies — to track consumers online. In response, major legislation such as Europe’s GDPR law and the California Consumer Protection Act (CCPA) pushed significant changes in how marketers manage, trade, and use customer data for the sake of privacy. 

For marketers seeking data-informed strategies for brand growth, another change looms on the horizon: Google has announced that as of 2023, their Chrome web browser will no longer support the use of third-party cookies. Since Chrome ranks as the world’s most popular web browser, this decision has been viewed by the marketing industry as the final nail in the coffin for the third-party cookie. Soon, marketing teams will need to find ways to adapt to the loss of this rich data source to keep their brands relevant. 

Fortunately, the world of marketing has been preparing for this day. There’s a wealth of new technologies that have emerged that offer brands a wealth of other ways to understand and connect with their customers. While it may seem like the end of an era, it’s a natural evolution and opportunity for marketers to get ahead of the curve. 

What Are Third-Party Cookies?

In the digital space, cookies generally fall into two categories: first-person and third-person. First-person cookies are commonplace across the web, created to observe user behavior within a brand’s website. These are useful for understanding how customers navigate the brand’s website. They can inform adjustments to the user experience to optimize and streamline the buying process — something beneficial to both consumers and brands. Once the user leaves that website, however, first-party cookies stop functioning — they don’t preserve user data across websites or track where customers go after leaving. That’s where third-party cookies come in.

Third-party cookies are created and stored in a user’s web browser to observe their browsing behavior across multiple websites. The data provided by third-party cookies helps brands understand their audiences’ desires and needs beyond touchpoints with the brand itself. Revealing trends and other user information can help to shape future marketing tactics. They store information across web domains and even across experiences, jumping from browsers to social media apps and more to display relevant ads.

How Do Brands Use Third-Party Cookies Today?

If you spend any time on the web, you’ve seen third-party cookies in action. How many times have you visited an online store and browsed through a couple of products and then seen ads for those exact products on completely different websites? That’s how third-party cookies work: they view your behavior outside the brand’s environment, then use that behavior to deliver targeted marketing to help you move from a browsing consumer to a buying customer. Long-term, the data marketers collect from third-party cookies is used to create detailed customer profiles.

As more consumers take more of their business online, they’re also becoming more aware of how brands use their personal information. This has led to an increasing push for a more privacy-friendly future of online marketing. Google’s announcement this year isn’t the first time that browser developers have limited the use of third-party cookies — Safari began restricting them in 2014, and Mozilla’s Firefox did the same in 2019. 

The decision to remove third-party cookie functionality from Chrome is significant because of the extent to which Chrome has become the web’s dominant browser — it accounts for nearly 50% of all web visits as of March 2020. Combined with new restrictions that the GDPR and CCPA laws have placed on how brands can use third-party cookies, it’s clear that this staple of the digital marketing world has become antiquated and is on its way out.

How Can Brands Adapt to a World Without Third-Party Cookies?

Though many brands have leaned heavily on the data that third-party cookies can provide, there’s no shortage of other options for analyzing and reaching an audience

Double down on first-party data

With the use of third-party cookies becoming more limited, first-party data — that is, the information that brands collect directly from their customers like email and previous purchases — is bound to become more valuable. To adapt, brands will need to find new ways to collect data from customers directly and enrich that data with insights to boost marketing campaigns’ effectiveness. The move away from third-party cookies also means that first-party data should be shared across the brand to ensure that all channels are informed by accurate data.

Tactics for collecting first-person data include:

  • Opt-in email sharing before accessing free content

  • Guided selling experiences that ask for customer input

  • Direct contact such as email and text

  • Post-purchase and other customer surveys

Shift focus to contextual advertising and content marketing

Another way for brands to continue to serve relevant ad content to their target audiences without the behavior data provided by third-party cookies is to pursue contextual advertising, which places ads alongside related content. Contextual marketing is useful because it addresses two goals in one tactic: first, meeting customers where they are in terms of their interests, and second, reaching customers with real potential to engage with the brand. If the ads are related to the content, they can successfully target audiences that are likely to be interested in your products.

Start people-based targeting

Facebook initially developed people-based targeting, but it’s useful for other marketers as well. It relies on a technology called identity resolution, which views an individual’s behavior across channels and devices without storing information that could lead to a user being identified. In the past, people-based advertising was only useful within specific walled gardens — such as Facebook — where people have voluntarily provided personal information. Now, marketers can use this tech to understand person-level insights better instead of reading patterns among groups. When paired with automation, people-based marketing can deliver extremely relevant and specific ads tailored to the user’s interests and behavior.

Getting Ahead

Though the loss of the third-party cookie is sure to introduce some challenges for brands initially, it’s by no means a death knell for digital marketing. By combining the collection of first-party data with personalized strategies, such as contextual advertising, marketers will overcome the absence of third-party cookies. And as technologies like identity resolution are integrated further into the marketing toolkit, brands will have plenty of ways to connect with customers while respecting their data privacy. The best thing marketers can do is diversify and get started with new strategies now so that the change, when it comes, is a blip vs. a boom in their marketing efforts.