Should You Be Concerned About the End of Third-Party Cookies?

As tracking technology and privacy evolve on the web, one major shift is causing ripples across the advertising world: Google Chrome is phasing out support for third-party cookies. This change, led by a supposed push for greater transparency and control over personal data, impacts virtually every stakeholder in the digital ecosystem.

Who Should Be Concerned About The End of Third-Party Cookies?

Certain groups stand to be affected more acutely and must pivot their strategies to navigate this change effectively. Let’s delve into who should be most concerned about the demise of third-party cookies and how they can adapt.

Digital Marketers and Advertisers

The first and most obvious group impacted, digital marketers and advertisers, have relied heavily on third-party cookies for targeting, retargeting, personalization, and tracking user behavior. Cookies have enabled precision in campaign targeting and measurement that was previously unimaginable. As these cookies crumble, so too does the foundation of their strategies.

Marketers and advertisers must explore new methods of reaching their audiences. Contextual advertising, which targets based on the website’s content or the current webpage, is coming back in force. Additionally, first-party data collection strategies—where businesses collect data directly from their interactions with customers—will become increasingly crucial.

Publishers and Content Creators

Publishers and content creators, particularly those who depend on ad revenue, are also in the crosshairs of the cookie phase-out. Third-party cookies have long enabled publishers to serve targeted ads, commanding premium rates from advertisers. Without this capability, publishers will undoubtedly see a decline in ad revenue.

To mitigate this impact, publishers turn to subscription ******, gated content, and direct advertising partnerships. Additionally, leveraging first-party data to offer targeted advertising packages and investing in content personalization to increase engagement and time on site are viable strategies for maintaining and re-growing revenue streams.

E-commerce Retailers

E-commerce retailers have utilized third-party cookies to understand customer behavior, retarget potential customers, and personalized shopping experiences. The loss of these insights can lead to decreased conversion rates and lower overall sales.

Retailers should double down on building direct relationships with their customers. Encouraging account creation, implementing loyalty programs, and collecting first-party data through feedback mechanisms can provide the data needed for personalized marketing strategies with less reliance on cookies.

Data Analysts and Digital Analytics Professionals

Data analysts and digital analytics professionals must adapt their methodologies and tools to a world without third-party cookies. Removing this data source threatens the accuracy of cross-site tracking, attribution modeling, and user behavior analysis.

Professionals in this space will need to become adept at working with first-party data, integrating data from various sources, and using machine learning to fill in the gaps left by the absence of third-party data. Tools like BigQuery, for instance, offer a powerful platform for storing and analyzing large datasets from multiple sources, providing a foundation for sophisticated analysis and insight generation.

Consumers

While not “concerned” in the traditional sense, consumers stand to benefit from the phase-out of third-party cookies through increased privacy and control over their data. However, as marketers adjust to new strategies, they may also encounter more generic advertising and less personalized web experiences.

Alternatives to Third-Party Cookies

Major players in the advertising industry—namely, Google and Meta—had already begun migrating to first-party data before this announcement was made. Google Ads did this in the form of Conversion Linker and Enhanced Conversions. Meta did this in the form of Facebook Conversions API. We’ll walk through these solutions for advertisers on these platforms and discuss how to set up your first-party data signals.

Google Ads Conversion Linker

Google Ads has been proactive in offering tools and features that leverage first-party data to maintain the efficacy of digital advertising campaigns. One such feature is the Conversion Linker tag in GTM. This tag facilitates using first-party cookies to measure conversions, enabling advertisers to continue tracking user interactions with their ads across their websites with a higher degree of privacy compliance.

Google Ads Enhanced Conversions

Enhanced Conversions is a Google Ads feature designed to improve the accuracy of conversion measurement by supplementing the data collected with hashed first-party customer information that users have shared with the advertiser. This can include details such as email addresses and phone numbers, which are converted into a privacy-safe, hashed format before being sent to Google. This hashed data is then used to match conversions against users logged into Google services, enhancing the accuracy of conversion attribution without compromising user privacy.

Facebook Conversions API

Facebook’s Conversions API complements the data collected through the Facebook pixel, enabling advertisers to send web and offline events from their servers directly to Facebook. This server-to-server communication method provides a more reliable way to measure and optimize ad campaigns, reducing dependency on client-side data collection methods like cookies.

Strengthening Your First-Party Data Collection

This transition underscores the importance of developing robust first-party data collection practices. Businesses should focus on ways to encourage direct interactions with their audience, such as through account sign-ups, newsletter subscriptions, and loyalty programs. By doing so, they build a valuable first-party data repository and enhance their ability to deliver personalized experiences without infringing on user privacy.

The key to this first-party data collection is to start with an alphanumeric, non-PII identifier to stitch different data platforms together, including those that don’t allow PII collection. You can use the User Pseudo ID from Google Analytics 4 and your Customer IDs to develop a robust online-to-offline data set.

Those simple actions can mark the beginning of a data warehouse or Customer Data Platform (CDP) transition for your organization to diminish the impacts of third-party cookies sunsetting.

Here’s how Portent can help you do that!

It’s Not The End, Just Another Beginning

The demise of third-party cookies is not the end of digital marketing as we know it but just another pivot point. By embracing privacy-first strategies, focusing on first-party data, and leveraging new technologies for analysis and targeting, stakeholders across the digital marketing spectrum can navigate this transition successfully. The key will be innovation and adaptability, with a renewed focus on building genuine customer relationships and providing value in exchange for their data.