Tactical Tech

By Chris Paradiso

SAY GOODBYE TO THE CHROME THIRD-PARTY COOKIE

Phaseout raises concerns among advertisers

The Google Chrome third-party cookie has been used for years to track website visitors, place ads in front of the right audience through data collection and monitor the user experience with a brand. It’s also been used to collect data on the buying habits of website visitors, even after they’ve left a website.

Earlier this year, Google announced that it would phase out third-party cookies in Chrome by 2022. Marketers everywhere are concerned with how this might drastically affect how they currently use the cookie.

By now, most marketers are aware of the organizations that are bringing down the hammer on data privacy issues.

With a growing number of consumers demanding more privacy, increased transparency, and greater control over how their data is recorded, it has become obvious that the web ecosystem needs to respond with change.

To help ease the fears of advertisers, Google announced it will work with them to ensure that this change does not destroy the online advertising business. It’s also important to note that both Firefox and Safari phased out the third-party cookie in 2013, but because of its popularity, the phaseout on Google is projected to have a much more dramatic effect on the advertising world.

Understanding this, Google said that, while these other browsers have responded to public concerns regarding privacy by blocking third-party cookies, they believe this would have an unintended negative impact on both the internet as a whole and users in general. They believe such an approach would encourage the use of opaque techniques like fingerprinting, which can actually reduce a user’s amount of privacy and control. They believe a more cooperative approach with advertisers will yield a superior end result, which is why they plan on removing the cookie in phases.

Should we worry? Yes. And no.

The third-party cookie phaseout on Chrome could, indeed, have a serious impact on certain areas of the advertising space. At the same time, others will not be affected at all. New data-driven alternatives are expected to emerge once the cookie is completely removed, and this could offer a solution to our dilemma.

What you need to know

• Google is not banning all cookies. Keep in mind that the third-party cookie is not the only cookie that Google uses in its algorithm. First-party cookies aren’t going anywhere. These are the cookies that track basic, cursory information about your website’s visitors. First-Party Cookies: These are codes that are generated and stored on a visitor’s computer anytime they go to your site. These cookies allow you to learn what a user did on your site and how often they went there. These are the codes that allow retail stores to remember what you left in your cart, your login passwords, and so on. These codes will not allow you to see any information related to that user’s behavior on other sites. Third-Party Cookies: These are codes that are placed on a user’s computer but are generated by a website other than yours. When that user visits your site, that code records information and sends it to the website that created the cookie. In many cases these websites are actually advertisers, and this is how they run retargeting campaigns. This is how you see an ad on YouTube for the guitar you were looking at last week. To boil it down, if you just want to track your own site’s visitors while they are on your site, chances are you won’t be affected much by this change. But if you are a marketer running strategic retargeting campaigns, then this phaseout will force you to change the way you run your campaigns.
• This was semi-predictable. By now, most marketers are aware of the organizations that are bringing down the hammer on data privacy issues. This is why you now see those requests at the bottom of certain websites asking you to accept their third-party cookies. Last year, Europe’s highest court declared that all sites using third-party cookies must gain this kind of consent before continuing to use these data sources. Websites with users within those countries saw a major impact on the accuracy of their Google Analytics numbers, because this platform relies heavily on cookies for its data. In response to the many concerned marketers, Google announced it was creating a “Privacy Sandbox” that would allow advertisers to run ads to their target audiences, but without the same level of user data. That tool hasn’t been released yet, but Google mentioned functionality that would allow for similar ad structure but with anonymous data so that individual privacy would still be protected. The user data would be stored within the Chrome browser of a user’s own device so that it would remain privacy compliant.
• It’s more than just data. Advertisers are also concerned with the reasoning behind the phaseout of the cookie. Other third-party platforms that advertisers run ads on also use third-party cookies, and this phaseout is expected to have a substantially greater impact on their revenue. This leads us to question whether Google is really concerned with user privacy or if it is looking to retain more control over the digital marketing world. Without the third-party cookie, advertisers will have to shift their ad spends to Google platforms that will still be able to target their first-party cookies and the new Privacy Sandbox. These smaller platforms are currently urging Google to halt the phaseout until other more meaningful alternatives can be created. If this phaseout continues, it could potentially mean the end for these businesses.
• Room for innovation. While this may spell the end for many businesses, it could also open the door for strategic and flexible brands. We all know that the demand for user privacy isn’t going away anytime soon, so I encourage you to explore other advertising options that are less cookie driven. As marketers, we should always be thinking about and looking for the next best way to reach our customers.

What to do next

Just because the third-party cookie is going away doesn’t mean you can’t still run pay-per-click ads. Older strategies such as contextual advertising will still allow you to distribute ads on websites that rank for similar keywords. So, while you won’t be able to place your ad in front of individuals who match a certain user profile, you will still be able to place your ad on websites within your industry.

It’s also a good idea to start exploring new ways to reach your customers: send postcards, publish more content on social media, strengthen your SEO through blogging, and develop strategic email marketing campaigns. If you’re currently looking into new software or platforms or plan to do so in the near future, be sure to investigate whether or not the third-party cookie phaseout will affect them, so you don’t run into further problems down the road.

Now is a perfect time to reevaluate your marketing and develop stronger, non-algorithm driven strategies that will set your business up for success regardless of what tracking changes occur in the digital world.

The author

Chris Paradiso is president of Paradiso Financial & Insurance Services, headquartered in Stafford Springs, Connecticut. His agency won PIA National’s Excellence in Social Media Award in 2013. He also heads up Paradiso Presents, LLC, which provides social media consulting, seminars and workshops to help agencies thrive in the online marketing world. Contact Chris via email at cparadiso@paradisoinsurance.com.