The Deprecation of 3P Cookies & Its Impact

Web cookies have been a fundamental building block in digital advertising targeting and measurement, particularly through the use of third-party cookies. However, effective advertising doesn’t necessarily have to rely solely on cookies. The deprecation of third-party cookies can compel us to become better marketers.  By exploring alternative strategies and approaches, we can bring forth benefits not only for our customers, but for our organizations. 

Ask yourself the following questions to determine how prepared your organization is for the deprecation of third-party cookies:

• Have you evaluated your current tracking methods and assessed how heavily your organization may rely on third-party cookies?
• Do you have an action plan in place to address necessary changes to strategies, activation, and measurement of current campaigns?
• Do you have the ability to collect, manage, and unify first-party customer data to create a single view across your organization?

If you answered no to any of these questions, don’t stress! Let’s explore the world of cookies and their impact on your organization’s marketing strategy. Our goal is to help you better navigate the evolving cookie landscape and make informed strategic decisions.

A Brief History

The concept and implementation of first-party cookies can be attributed to Lou Montulli, an American computer scientist.  He, along with John Giannandrea and Tim Berners-Lee, developed the initial specifications for HTTP cookies in the mid-1990s. They aimed to develop a mechanism that stored client information, while enabling personalized user experiences on websites.

Primary Applications of First-Party Cookies:

• Session management: They help maintain user session information.  This allows websites to remember user preferences and keep users logged in as they navigate different pages of the site.
• Personalization: First-party cookies can be used to remember user preferences, such as language selection, font size, or customized layout.  This enables websites to provide a more personalized browsing experience.
• Analytics: They assist in gathering information about user behavior and interactions on the website. This data is often anonymized and aggregated to generate insights for website optimization and improvement.
• Tracking and targeting: First-party cookies can be utilized by website owners to track user interactions.  They can also deliver targeted advertising or content, based on the user’s browsing history and preferences.

This innovation was revolutionary, laying the foundation for all modern web tracking and personalization practices. Yet, as adoption grew, so did the demand for even more sophisticated tracking, targeting, and measurement capabilities.  This was true across all web properties, leading to the emergence of third-party cookies.

When a user visits a website, third-party cookies are instantly created.  Interestingly enough, they’re created by domains other than the one the user is currently visiting. These external domains or entities are able to set third-party cookies by embedding content or scripts on the website.  They can be found in various forms such as advertisements, social media buttons, or tracking pixels.

Primary Applications of Third-Party Cookies:

• Targeted Advertising: Third-party cookies enable advertisers and marketers to track user behavior across multiple websites. Marketers are then able to create user profiles and deliver targeted ads based on interests, preferences, and browsing history. Targeted advertising allows businesses to reach relevant audiences, increase engagement, and potentially improve conversion rates.
• Audience Insights and Segmentation: By analyzing the data collected through third-party cookies, businesses can gain valuable insights into their target audience’s behavior, preferences, and demographics. This information helps in refining audience segmentation, understanding customer needs, and tailoring marketing campaigns to specific segments for better results.
• Performance Measurement: Third-party cookies provide metrics and analytics that help businesses measure the effectiveness of their advertising campaigns. By tracking conversions, click-through rates, and other key performance indicators, businesses can assess the success of their marketing efforts, optimize campaigns, and allocate resources more efficiently.
• Ad Retargeting:Third-party cookies also enable businesses to engage in ad retargeting.  This involves showing personalized ads to users who have previously interacted with their website or shown interest in their products or services. This technique can increase brand recall, improve conversion rates, and maximize the return on ad spend.
• Partnerships and Data Sharing: Businesses may collaborate with third-party providers or platforms that use cookies to collect and share data. This collaboration allows businesses to access additional data sources, expand their reach, and enhance their targeting capabilities.

The Fall of 3P Cookies

In recent years, mounting concerns over privacy and the potential for abuse has prompted a movement to restrict and over time, eliminate the use of third-party cookies. Factors influencing and accelerating the transition away from 3P cookies include:

Privacy concerns: Third-party cookies enable extensive tracking of user behavior across multiple websites, often without the explicit consent or knowledge of users. This tracking can be seen as invasive and a potential violation of user privacy, as it creates detailed profiles of individuals’ online activities. Key examples in recent American history include the White House Drug Policy Office, National Security Agency (NSA), and Central Intelligence Agency (CIA) use of cookies to track users visiting their websites.

User empowerment: As awareness of tracking practices have become more widespread, users have grown increasingly concerned about their online privacy and the protection of their data, especially in the wake of the Facebook-Cambridge Analytica data scandal during the 2016 U.S. Presidential Election. There is a growing demand for more transparency, control, and consent regarding data collection and tracking practices.

Stricter browser privacy measures: Major web browsers, such as Google Chrome, Mozilla Firefox, Apple Safari, and Microsoft Edge, have implemented stricter privacy measures to protect users from invasive tracking. These measures include enhanced cookie controls, default blocking or disabling of third-party cookies, and the introduction of mechanisms like Intelligent Tracking Prevention (ITP) and Enhanced Tracking Protection (ETP).

Emphasis on privacy regulations: Privacy regulations, such as the European Union’s General Data Protection Regulation (GDPR) and the California Consumer Privacy Act (CCPA), have been introduced to safeguard user data and privacy rights. These regulations impose requirements on data collection, consent, and user rights, leading to increased scrutiny and accountability for companies handling user data.

Ultimately, the industry is transitioning towards more privacy-centric practices to balance personalized experiences with user privacy and data protection. Brands that prioritize privacy as a fundamental aspect of their business will gain a competitive edge in attracting and retaining customers.

Where to Start

Begin by assessing the influence 3P cookies has on your business objectives.  Evaluate the impact their deprecation may have on how you plan, execute, measure and operationalize marketing strategies. By acknowledging your current situation, you can develop a thorough roadmap for smoothly and efficiently transitioning away from third-party cookies, minimizing disruptions along the way. Furthermore, this process has the capacity to uncover potential opportunities for future innovation and expedited growth.

Five Critical Areas of Consideration

At Transparent, we have supported numerous brands as they prepare for a cookieless future. Drawing from our expertise, here are five critical areas that demand careful consideration when crafting an effective cookieless strategy.

1. Data: Establish a forward looking data strategy and supporting governance that enhances first-party data collection, curation and activation
2. Measurement: Configure expertise, metrics, systems and processes to support a comprehensive “post-cookie” view of performance
3. Activation: Develop privacy-compliant activation and personalization strategies that respect users’ privacy while still delivering effective marketing strategies
4. Infrastructure: Optimize existing architecture to enhance data collection & curation; measurement; privacy & consent; personalization and collaboration
5. Operations: Adapt processes and ways of working to take advantage of new data sources, measurement approaches and activation strategies

Stay tuned for an upcoming piece in our cookieless series that will highlight the tips, tricks and tactics for addressing these critical areas. 

How Transparent Partners Can Help

Transitioning to a cookieless future indeed brings challenges.  It also offers a chance to reevaluate and optimize marketing strategies to better connect with consumers.

We understand the complexities involved in crafting a modern marketing data strategy.  In fact, our expertise runs deep in all things media planning, activation and measurement.  Therefore we can provide valuable assistance during this transition.

A great place to start would be with our Readiness Assessment.  The assessment evaluates the data, measurement, activation, infrastructure and operational aspects of your marketing practices. Upon completion, we develop a customized action plan to prepare your organization for a cookieless future.

To learn more connect with us at info@transparent.partners.