Are Third-Party Cookies Becoming a Thing of the Past?

Cookies, especially third-party, are crucial to the modern Internet but a liability to user privacy.Third-party cookies reside on a user’s computer or mobile device and are used by advertisers and marketers to track your web activity so that they can offer relevant and targeted ads to users.Google’s decision to ban third-party cookies has been a topic of hot debate in the online advertising industry. Some have praised it, while others have criticized the move.This article will examine Google’s decision to block third-party cookies and what its impact may be on the future of online advertising, marketing, and content personalization.

Google has been deliberating on banning third-party cookies for some time now.In August 2019, the search engine giant initiated the Privacy Sandbox to personalize (or target) online ads while still preserving user privacy.Then in January 2020, Google announced its intention to ban third-party cookies from its Chrome browser by 2022. This is the same move that other browsers, such as Firefox and Safari, made years ago.Google also intends to replace third-party cookies with alternative ad technology developed through Privacy Sandbox.However, Google will not be building alternate tracking identifiers with cross-site tracking abilities after phasing out third-party cookies.

Why is Google banning third-party cookies?

Google has always been at the forefront when it comes to online privacy and data security. But before diving deeper into Google’s decision about third-party cookies, you need to understand the major problems with third-party cookies.

• They're less secure than first-party cookies because the browser can't verify their authenticity.
• Third-party cookies can be used to track users across the web or create user profiles and segments. This is particularly problematic because most people don't know they're being tracked in this way, which means they have no control over what information is collected about them or how it's used.
• Third-party cookies can create confusing experiences for users trying to sign in to websites like Facebook or Twitter that use multiple authentication providers (i.e., different companies offering logins via OAuth).

In addition to these points, Google has its reason for the decision.First, third-party cookies are a liability to user privacy. They are often used for ad tracking across multiple sites, which can track users without their knowledge.The tracking is done by placing a unique identifier on your computer or device when you visit a website with third-party ads.That identifier can be read and used by other websites that have been added to your browsing history (which you may not have noticed). This means that companies can build up profiles of what you look at online and use this information to tailor their advertising messages to you.With General Data Protection Regulation (GDPR), the California Consumer Privacy Act (CCPA), and the recent Facebook data breach scandal, users are demanding more privacy, transparency, and control over their data.According to a KPMG survey, more than 80% of people expressed concerns about their data privacy. A majority of the people also showed growing concerns about how much data is collected from them.

‍GDPR requires companies like Instagram, Facebook, LinkedIn, and Google to implement “privacy by design.” This means that handling user data need to be transparent. These companies will also need explicit user consent before using their data.

Second, third-party cookies do not work as well as first-party cookies when it comes to serving relevant ads based on user preferences or interests.One study revealed that first-party cookies outperformed third-party ones in terms of ad performance by more than four times!The bottom line is that if you're using third-party services like Facebook Pixel or Google Analytics and want them to continue working properly on your site in the coming years—and especially if those services are essential for advertising revenue—you want them upgraded now so they'll still work when the deadline hits next year!Google's third-party cookies policy will affect both advertisers and publishers using this technology as well as consumers who regularly use Google products such as search engines or email accounts (Gmail).

What will be the impact of the third-party cookie ban?

Google’s decision to block third-party cookies will have a significant impact on all the following parties:

• Advertisers using Google Analytics for tracking
• Publishers dependent on third-party cookies for revenue
• Internet users who were initially exposed to ads whenever they go online

One of the immediate impacts that you will see will be a dwindle in the size of third-party audiences. You will no longer be able to scale your third-party audience base. As a result, you will see a decline in conversion rates and accuracy in targeting.Therefore, there is a need for new strategies to analyze the audience. You may also need to rely on other marketing approaches such as email marketing.If you are involved in the processing and selling of advertising data, you need to start looking for alternative ways to securely collect and compile audience data that doesn't rely on third-party cookies.

Alternatives to third-party cookies

There are a few alternatives to using third-party cookies. Some of these include:First Party Cookies – This is the most common type of tracking technology used by websites today. A first-party cookie comes from the domain of the website you're visiting (e.g., "google.com").Unlike third-party cookies, first-party cookies will not be going away in the foreseeable future.These cookies are not tied to any particular advertising network or company, but they can still be used for advertising purposes as long as you give consent to having your data tracked and stored to tailor ads based on your browsing history.First-party cookies could serve as a valuable tool for personalizing experiences throughout the customer journey while ensuring privacy and relevant, focused advertising opportunities.If you are interested to know more about first-party cookies, read Osano’s guide to first-party cookies.

Identifiers

Online identifiers can be used to identify users or link them to their identities. They can identify visitors depending on a user's access to sites, tools, or apps.Some standard identifiers include MAC addresses, Internet Protocol (IP) addresses, Pixel tags, Advertising IDs, and Device fingerprints.Browser Cookies – This refers to any cookie stored on your computer when you visit a website that uses them for tracking purposes such as remarketing campaigns (i.e., ads tailored specifically for those who have visited certain pages before).

Consent

Consent has become extremely crucial with growing concerns for user privacy. You might want to look into data consent management.Consent management is the process of capturing and managing user consent while being compliant with GDPR, CCPA, or any other data privacy and protection regulations.This marketing strategy will help you gain the trust of your consumers when they see that you take their privacy seriously and ask for consent.

Context

Contextual targeting is an underrated advertising technique that uses keywords or topics among other factors.However, with third-party cookies gone and a tighter GDPR, you will see contextual targeting gaining relevance in the ad tech industry due to its privacy-friendly and effective practice.It is a viable option for advertisers as it doesn't use third-party cookies or target consumers directly.With the help of contextual targeting, you can ensure ad placements are done in the most appropriate context. As a result, ads are more likely to be viewed with interest.For example, placing an ad for a baby product in a blog offering tips to new mothers or a new smartwatch ad in a gadget review article.What this means is that a particular audience will see only the most relevant and actionable ads.

Cohorts

A cohort is a set of users clubbed together based on a common identifier. It comprises large groups of individuals with similar interests, preferences, or personas.In other words, it refers to specific experiences, events, or other factors common in a group of users. Cohorts are used to recognize and target portions of the market that are effectively categorized and treated as one.In cohort marketing, users in a cluster are targeted without revealing users' private data.An example of a cohort could be a football club’s fanbase. They are likely to make purchasing decisions driven by emotions of excitement or joy when they see their favorite team win and share this experience with other fans.

Third-party cookies may be on the way out

Google's decision to ban third-party cookies could have a significant impact on the advertising industry.It will also affect content personalization, as many websites rely on third-party cookies for this purpose.As such, marketers and publishers need to consider how they can prepare themselves for this change.

Conclusion

Third-party cookies are a cornerstone of digital advertising and have been for many years. They allow advertisers, publishers, and content providers to enhance their experiences for users and increase the effectiveness of their campaigns.However, as we move towards an increasingly privacy-focused internet world where people are more concerned about what information they share online, these cookies may soon become a thing of the past.