A few years ago, the impending death of third-party cookies was a hot topic in B2B. How will this impact marketers in the short-term? How will it affect long-term marketing strategies?
However, long delays have meant that the sense of urgency has been lost, and the end of third-party cookies just isn’t at the forefront of marketers’ minds right now. This year, they will finally be removed from Google Chrome. No more delays. 2024 is the year that third-party cookies will come to an end. So, what’s happened so far, what’s coming next, and what can you do to prepare? Read on to find out.
A new digital landscape: Google’s Privacy Sandbox
Google’s Privacy Sandbox is designed to uphold online privacy for users while providing companies and developers with the necessary tools to establish successful digital enterprises. The primary objective of the Privacy Sandbox is the phasing out of third-party cookies, once alternative solutions are implemented, and minimizing cross-site and cross-app tracking.
This effort aims to maintain free access to online content and services for all users. The Privacy Sandbox encompasses various APIs (application programming interfaces) that redefine the role of web browsers, empowering them to act on behalf of users on their devices, thereby protecting their identifying information during online navigation.
They are pivotal for the future of personalized advertising. Among these, Protected API holds significant value as it tackles crucial targeting and retargeting issues, while safeguarding user privacy. APIs are now accessible to all Chrome users by default, which allows extensive live-traffic testing before the complete phasing out of third-party cookies.
This marks a significant shift in the approach of browsers, as they move towards providing specific tools for distinct use cases while upholding user privacy in the envisioned future of the Privacy Sandbox.
Google’s legal challenges
The UK’s Competitions and Markets Authority (CMA) is challenging Google’s alternatives to third-party cookies, as they may pose anti-competitive risks. Tony Lamb, our Propolis Expert in Data & Insights, mentions the regulatory and technical hurdles associated with the removal of third-party cookies:
“They were pushed back from the UK Competition and Markets Authority, because obviously they have dominance in the market. There were concerns for many players in the market that what they were doing was anti-competitive.”
The CMA aims to gather comprehensive information about the impact of the Sandbox on the advertising market by mid-2024. Before making a decision, the organization needs assurance that there are no competition issues or that effective solutions exist.
Google has recently faced a significant legal challenge in Europe as 32 media companies, including Axel Springer and Schibsted, filed a major lawsuit against the tech giant. The media organizations allege that Google’s digital advertising practices are unfair, causing them to lose market share.
Impact on analytics and targeting
Tony says the absence of third-party cookies in browsers like Firefox and Safari poses challenges for accurate targeting:
“Firefox and Safari are no longer supporting third-party cookies. The challenge is: you’re not able to target if you don’t have any sort of real insight coming through. So, the targeting is going to be less accurate. Therefore you’re going to be sending advertising messages to people and it’s a matter of chance whether they’re interested or not. When you haven’t got any insight around that, you don’t know if the advertising is relevant. So, ultimately ad responses are going to come down.”
He emphasizes the growing significance of first-party cookies, urging marketers to prioritize securing customer consent: “the first place to start with is first party cookies. So you need to be able to capture and have as much data as possible with your customers or prospects, and obviously you need to get your cookie consent from them so you can store that.”
Tony adds that it’s important to provide value in exchange for information: ”try to make sure you’re giving value back to the customer. When there’s that value exchange, they are more likely to give you information back.”
Alternative data sources
Tony discusses emerging alternatives, such as contextual advertising, as a means for marketers to understand user interests and deliver relevant content. He highlights companies like Permutive, which capture local browsing habits to enable targeted ads without relying on traditional cookies.
“As technology develops, omnichannel platforms are linking all the touch points together. If not, it becomes harder to be able to join the dots. Technological platforms are really starting to enable this and run scenarios to try and optimize things. That’s really where AI machine learning is coming in, to allow us to target far more effectively and demonstrate better ROI.”
Opportunity in a cookieless future
Riaz Kanani, CEO and Founder, Radiate B2B, sees the end of third-party cookies as an opportunity, citing the surprising performance of his own platform without them: “the performance of our platform without third-party cookies was better than the performance with third-party cookies, and that was counterintuitive at the time, five or six years ago. But the reason for that was because in the marketing world, we are basically geared around quantity.”
He points out the lack of quality in third-party cookie data and suggests that marketers can move away from quantity-based targeting. Company targeted advertising becomes a focal point in Riaz’s strategy, allowing for personalized experiences:
“We’re using the IP address to identify companies. We can’t identify individuals, but in our case, we use AI to narrow down our targeting beyond the entire company. We can therefore get an understanding of what the overall conversion rate is. So whilst we may not see everybody, we’re able to see enough so that we can start predicting what the conversion is going to be.”
Impact on ABM
Despite the decline of third-party cookies, Riaz claims that ABM strategies can thrive by leveraging company targeted advertising and IP-based targeting. Personalization remains a key focus, and he encourages marketers to adapt to more effective techniques.
“I think we’re going to see more companies do contextual targeting. When it comes to marketing strategies, it’s always about layers. And you start with the lowest cost layer that delivers the biggest return. I think company targeted advertising and contextual targeting just dropped down the list and became a bigger priority for marketing than ever before, so that’s probably the biggest shift in tactical channels used. But on a strategic level, I don’t really see a change. You still need to get in front of stakeholders, right? You can never see everybody inside a campaign in the sales process. So you need advertising to reach them, it’s just going to be a bit harder.”
The influence of AI on conversion tracking
Technological platforms are now actively facilitating this process and running scenarios to optimize outcomes. This is where the role of AI and machine learning can make a difference, enabling more precise targeting but Riaz has reservations about this:
“I think machine learning will help with conversion tracking over time, but I’m hesitant though. To use machine learning you need access to large amounts of data, and guess who’s getting large amounts of data? It’s Google. Yes, there is an opportunity there, but I worry that if we’re not careful, we could walk into a scenario where we end up with the entire internet being the ‘Wall Garden of Google’, just like Facebook and TikTok. I don’t think that’s good for the market or the consumer. But there’s definitely opportunities with AI, especially around personalization.”
In any case, B2B marketers do need to get ready for a cookieless future. From adapting to innovative targeting methods to reassessing measurement metrics, it’s important to look into alternative ways of coping with the inevitable phase out of third-party cookies.
