Third Party Cookie Changes and What They Mean for Advertisers

Have you ever been to a Chinese or Japanese restaurant and been given a fortune cookie, which on crunching into it often reveals a message on a piece of paper hidden inside the cookie? Well, internet cookies were supposedly named after these little nibbles.

What Is a Cookie?

Whilst not quite as edible as fortune cookies, online cookies are based on the same principle: they’re a small text file that holds data.

Just like edible cookies, there are different types of online cookies. 

First-party cookies are created by a website you visit and are designed to collect information that can help the website owner improve their site. These cookies are used for things like saving a shopping cart, user settings and so on…

Third-party cookies are set up by a third-party server, for example, Facebook or Google. They are created when a block code that you can insert into your website creates them, this code is usually referred to as a tracking pixel. Although it’s important to note that not all tracking pixels rely on cookies, many of them do.

Third-party cookies are used to identify a person who is using a particular website. These cookies then carry this information between websites so that you can see how the user is moving through the internet. By doing this, platforms like Google Ads and Facebook can start to understand a user’s online history and then use this data to target advertising messages. 

This is why it can sometimes feel like somebody is creepily watching over your shoulder as you browse the internet.  The tracking pixels trigger a third-party cookie and this cookie allows the advertising platforms to connect your activity as you browse between sites.  The resulting experience for users can be highly targeted advertising messages. 

Cookies are very useful in enhancing a user’s experience

What’s the difference between a cookie and a tracking pixel?

A cookie can be created as the result of a tracking pixel firing, however, the tracking pixel is likely to be doing other things too such as collecting information about the browser and system configuration to pass into your analytics tool.

Are cookies changing?

Cookies have been an incredibly useful tool for advertisers for a long time. But in recent years users have demanded more privacy and transparency.

So whilst cookies might be delicious for the advertiser, the concept of unknowingly having someone use your data to target ads can leave a bitter taste for some users. 

Google are responding to this by phasing out third-party cookies as part of their Privacy Sandbox project. Google recognises that abandoning third-party cookies will be a big adjustment for many, so they plan to replace these cookies with privacy-conscious methods. 

First-party cookies will remain the same, but third-party cookies are already changing, as Google aims to phase them out before 2022. 

You may have already noticed how some websites now ask for your consent for them to use cookies.  These consent forms are especially prevalent in countries impacted by the GDPR (General Data Protection Regulation).  You can read more about the GDPR and its impact on cookies here. Only cookies classified as “strictly necessary” are exempt from the cookie consent notification and even then you need to explain somewhere what these cookies are doing.  

Third-party cookies will become more and more restricted until they are gone completely because they’re no longer useful.

What does this mean for advertisers?

Without access to third-party cookies, advertisers need to change their ways of working slightly. Targeted ads may never be the same, and certain types of data will be more difficult to acquire.  

Whilst we’re confident that it will still be possible to target specific groups of people and reach your intended audience, it is likely to mean that this targeting is somewhat more “fuzzy” than it is right now.  This will mean that in order to maximise your media spend efficiency the quality of your ads creative and messaging will need to be stronger than ever to ensure it cuts through and resonates with your existing audience. Targeting through some methods (for example data collected via the Facebook audience network – that is the sites outside of Facebook) will become much more difficult in the short-term, whilst we’re still waiting to see the precise impact of these changes on advertisers we’re sure that there will be an impact. 

What can we do now that we don’t have cookies?

Third-party cookies are on their way out, which looks like a victory for privacy and whilst not a defeat for effective advertising it’ll certainly making it tougher to score a goal with your advertising. But how different will things really be?

In short, don’t despair.  Although this may be the end for third-party cookies, this isn’t the end of tracking.

Other browsers, such as Safari and Firefox, have been blocking third-party cookies for a long time. But rather than tracking disappearing completely, tracking technology providers have found alternative methods to collect data just like third-party cookies used to.

Google’s privacy sandbox aims to protect the privacy of users whilst tracking them. This will allow advertisers to collect some data, but with restrictions in place. 

Google intends to replace cookies with new browser APIs (Application Programming Interface), such as trust tokens.

Trust tokens will be able to relay certain information to advertisers in the same way that cookies can. For example, it can tell you if a user visited a site or clicked on an ad. However, it won’t track users across other websites. 

Apple devices have long come with a hidden IDFA (Identifier for Advertisers).  IDFA is a unique identifier for mobile devices and is used to target and measure the effectiveness of advertising on a user level across mobile devices.  

With the launch of iOS14 Apple have started rolling out sweeping changes to how IDFA’s work with users prompted to “opt-in” at app level before the IDFA is revealed to publishers.  Currently, about 70% of iOS users share their IDFA with app publishers, after this change it’s estimated that this number will drop to 10% to 15%.

Things are certainly changing for advertisers. We are heading towards a future where the values of privacy are contesting the ethics of tracking.

Tracking will become more restricted, more transparent, and consent will be a big focus when collecting data. Advertisers will need to remain mindful of these changes and consider their impact on campaigns and the way in which they’re targeted and reported on.