A cookieless future, what does it mean?

What are cookies?

To understand the implications of a cookie-free future, it is essential to understand what a cookie is. Simply put, a cookie is a small text file that stores information about a user visiting a website. These files are stored on your computer, mobile device or tablet. There are three types of cookies: first-party cookies, second-party cookies and third-party cookies. Technically, there is not much difference between these cookies, but they have different functions. The difference is mainly in the context of a visit and the origin of the cookie, because each cookie has a separate owner. For clarity, let's take a look at each of these cookies.

Type of cookies

First-party cookies

These will be set by the website the user is visiting. For example, when a user visits the vrt.be website, vrt.be immediately creates a cookie which is then stored locally on the user's computer via the browser used. The purpose of these cookies is to enable the improve user experience. They remember the user's account password on the website, preferred language, items in the shopping cart and how the user navigates through the website. This allows the website owner to track how the website is used and identify where improvements can be made. However, the website owner may not use the data to create a user profile of its visitors.

The website does not require user consent to set these kinds of cookies. This is separate from the pop-up that appears at the bottom of a website asking the user to accept cookies. However, visitors should be informed in a privacy statement that these cookies are present on the website.

Second-party cookies

This is essentially first-party data that can be accessed with a other party are shared. It involves an exchange of data between two parties. The name "second-party cookies" is not quite correct, but is widely used.

Third-party cookies

These are the cookies that are relevant when discussing a cookie-free future. These cookies are set by third parties on a website, with the owner's permission. They are also known as tracking cookies, because they track user visits to build profiles and map the entire browsing behaviour. This data is then used to ads set and remarketing apply.

An example of how these cookies can be useful for marketers: a user visits a shoe shop and views a product page. The user decides not to buy the shoes. A few days later, the same user sees an ad for the same shoes on a news website. These ads are created using data collected by the third-party cookie. The user must accept these cookies before they can function.

The third-party cookie collects information from the website visit of the user and shares it with companies such as Google Ads to set up targeted marketing campaigns. These cookies can only work if the user has given permission for them to be placed on their device.

Why a Cookieless Future?

Many people value privacy, both online and offline. That is why laws and regulations have been introduced to protect users' online privacy. People feel increasingly uncomfortable being approached with personalised ads online. Increasing regulations around online privacy have made this kind of advertising less attractive. Web browsers such as Safari, Firefox and Microsoft Edge have already taken steps to block third-party cookies. Google will also join this trend by the end of 2023 by blocking these cookies in their web browser, Chrome. This move is important because Chrome currently serves 56.12% of internet users in Belgium.

What are the implications for advertisers?

Advertisers will be significantly impacted when third-party cookies are no longer available. Many ads rely on these cookies to collect data and target specific audiences. Without third-party cookies, it will be more challenging to collect data outside your own platforms. Moreover, it will be harder to direct the right audience to your website due to the limited data available.

Advertisers will also face challenges with attribution models, which determine which sources are responsible for conversions. It will be harder to track and attribute conversions to specific channels without the ability to track users over a longer period of time. This will also affect remarketing campaigns, as blocking third-party cookies through Intelligent Tracking Prevention (ITP) will prevent the creation of long-term remarketing lists. Users will be assigned a new unique ID every other day, making it difficult to recognise the same user over a longer period of time. While this provides more privacy for users, it provides less data for advertisers.

The solution

The cookie-free future will bring significant changes and limit advertisers in their current ad strategies. Therefore, it is crucial to explore alternative options. With the advent of a cookie-free future, other solutions will become more viable. The perfect solution does not yet exist, but it is worth considering these options.

First-party data

The importance of first-party data will increase in the cookie-free future. With the disappearance of third-party cookies, websites will have a larger number of anonymous users. It will be crucial to build a relationship and collect first-party data, such as e-mail addresses, phone numbers and other information that can be used to create a complete profile of the customer. This requires a "for-what-is-heard-what" approach, where companies must offer something of value that makes customers want to share their data. High-quality content becomes essential in this process. Companies need to start thinking about these aspects now to reduce data loss.

Contextual targeting

Acting on the data you already have is also crucial. This includes prospecting, identifying similar target groups based on existing customers and cross/upselling, introducing existing customers to other products or services the company offers. It is also important to ensure a long customer journey and create a high level of customer loyalty. Quality over quantity is important when it comes to first-party data.

Contextual targeting is becoming an increasingly interesting approach to advertising. This involves examining the content and context of a page and tailoring the ad accordingly. The aim is to show visitors an ad for products or services they are already interested in. For example, someone reading a blog about sports fishing is more likely to click on an ad for the latest fishing rods than someone seeing the same ad on a news site.

Server-side tagging

Server-side tagging is another alternative worth considering. This uses a cloud-based server construct, sending data to a server of the website operator, which is considered first-party data. Browsers will not block this data. The server then pushes the data to external platforms such as Google Analytics and Google Ads.

Unlike client-side tagging, browsers can clearly see where the data goes and will not block it. Server-side tagging is a viable solution because browsers will start blocking third-party cookies, making client-side tagging less valuable. The ultimate goal of server-side tagging is to create an endpoint in a server environment owned by the advertiser.