THIRD-PARTY COOKIE EXPIRATION !!!
How many times have you quickly checked that box or clicked “Accept” when a website asks you to agree to their long terms of service or privacy policy that you really should read but don’t have the time or energy to parse in full? We’ve all been there – hastily consenting to pages of legalese about how our personal information can be used, shared or leveraged without understanding the implications behind that agreement.
The third-party cookie is soon expiring in Chrome, but many digital advertisers remain unprepared for this “cookie armageddon.” As per the blog written in The Wall Street Journal, Google first announced plans to phase out cookies back in 2020, but now it will finally phase out third-party cookies for 1% of Chrome and Android users in Q1 2024 with complete deprecation scheduled for the year’s second half.
WHAT IS A COOKIE ?
Cookies are small text files that websites place on your computer when you visit them. They act like mini memory cards, allowing sites to save little bits of data to recognize your device later. For example, if you looked at toy train videos one day, you may have seen toy train ads on other sites after that. This helped companies know if their ads were working, but it also meant your browsing got tracked everywhere.
Google and other big tech companies use cookies to learn all about you. That way, they could serve up ads and other stuff they thought you would like. They made a lot of money doing this! But people started feeling uncomfortable with how much they were getting spied on across the internet.
Many companies also use cookies to track user site visits and clicks. This lets them show ads about things you might be interested in based on other sites you visited. This type of targeted ad is how many free games, videos, and other online things make money.
WHY BLOCK COOKIES ?
However, saving data about what people do online also raises privacy concerns. That’s why web browsers like Chrome plan to phase out third-party cookies in particular – those are cookies placed on your device by companies other than the site you are visiting. These third-party cookies can quietly track you as you browse different websites.
So, blocking them aims to give users more privacy. But it also means online ads and content sites rely on to earn money will work differently.
WHO BENEFITS OR STRUGGLES ?
Google and Facebook already have lots of first-party data from users logged into their services. So they may not suffer and could even become more powerful. However, other free web content, news or gaming sites that depend on regular display ads and outside cookie data will probably lose money. They may have to charge subscription fees or find new types of ads.
Here is an analysis of how different players in digital advertising will be impacted as third-party cookies get phased out:
Publishers
Publishers who rely heavily on programmatic advertising demand and third-party data for targeting may see revenues decline without cookies. Smaller publishers will be hit harder than mega-platforms like Google and Facebook with direct relationships and user data.
However, there are alternatives publishers can explore:
– Use first-party data from logged-in users to better target contextually
– Adopt tools within Privacy Sandbox once tested and approved
– Implement subscriptions if the loyal audience base is there
– Insert more on-site advertising like branded content
Advertisers
Advertisers will need cookies to target and measure conversion performance precisely. Prospecting new customers rather than retargeting existing site visitors will be impacted. Display and programmatic campaigns typically leveraging cookies will underperform.
Shifts in strategies advertisers can make include:
– Rely more on context, placement, and first-party data
– Spend more with walled gardens that have user data access
– Experiment with emerging identifier solutions once the scale is reached
Agencies
Media buying agencies relying on tracking-heavy programmatic placement for clients must demonstrate value beyond cookies. As consultants, adapting to privacy-centric strategies and new solutions will be crucial. Client expectations for precise measurement may need adjusting.
Ad Tech Vendors
Ad tech platforms built strictly around third-party data and programmatic efficiency will feel immense pressure. But those providing analytics, identity mapping, consent tools, and other more privacy-aligned alternatives may emerge stronger in supporting the rebuilt digital ad infrastructure.
Walled Gardens vs. The Open Web
With owned user data access, walled gardens like Google, Facebook, and Amazon may gain even more advantage over the ad-supported open web struggling with less precise tracking. Unless identifiers and techniques developed benefit the entire ecosystem, more consolidation around the gardens could occur.
IMPACT ON USERS:
1. More privacy
The main goal of “killing cookies” is to enhance users’ privacy by limiting covert tracking of their web browsing behaviour by advertisers and other entities. With third-party cookies going away in Chrome and other browsers, users should see a decrease in targeted ads following them across the sites they visit. Their web activity stays more anonymous.
2. Changes in ad content/relevance
However, because cookies enable relevant ad targeting and personalization, users might find some ads become more generic and less precisely tailored to their interests. On the other hand, new, privacy-focused ad technologies like Google’s Topics proposal could ensure users still see relevant ads based on overall browsing themes rather than individual data profiles.
3. More paywalls/subscriptions
With websites and apps potentially losing significant advertising revenue from third-party cookies and tracking elimination, some may institute more paywalls and subscription fees to cover costs. So, users may have to pay for access to content that used to be free and ad-supported. However, alternatives like micropayments may arise for à la carte access.
What the cookieless web will look like has yet to be determined. New user tracking and more ad methods that protect privacy are still being built. As the internet enters this next era, there will likely be both winners and losers.
REGULATORY BODY TAKE ON THIS
Google’s proposals to phase out third-party cookies in Chrome by 2023 have caught the gaze of European and British competition authorities, who are wary of the search giant’s next move. The European Commission and the UK’s Competition and Markets Authority have opened formal antitrust investigations into Google’s “Privacy Sandbox” initiative and its potential to strengthen its dominant standing in online advertising markets once cookies disappear. Regulators aim to determine how Google plans to employ user data and AI capabilities moving forward and whether replacement tracking and targeting tools unfairly outpace rivals dependent on cookies—sparking more significant monopoly concerns. Both bodies promise close inspection upon Google as it kills one surveilling pillar only to prop up new ones potentially.
Google says it is building new privacy-focused tools for advertisers. We will see if it works as well. It may be more challenging for companies big and small to make money on websites now. But in the end, it helps protect everyone’s privacy so they don’t feel like they are being watched everywhere they browse.
CONCLUSION
In conclusion, saying bye to cookies marks a significant change in how the internet works. We’ll lose some personalization but gain more control over our privacy. Like all significant changes, adjusting to a cookieless life online may take some time. But in many ways, it’s for the better.
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