As of the beginning of 2024, Google has scrapped third-party cookies for 1%, which is roughly 30 million Chrome users. While Firefox and Safari turned off their support for third-party cookies in 2017, Google allowed it to continue until 2020 when they announced their plan to phase out as well. After a series of delays, the purge has finally started as Google plans to complete its plan to completely phase out cookies for all Chrome users by the third quarter of 2024.
What Does Going Cookieless Mean?
Cookies are data, like user name, password, and other data, stored as a text file in a user’s browser. It allows websites to track their users’ online behaviour and provide a customised browsing experience. There are two types of cookies:
First-party cookies: The most common cookie that a user agrees to be served by the website the user is browsing. Its purpose is to maintain a seamless browsing experience and recognise the user from previous visits.
Third-party cookies: These are attached by third-party websites, other than the one the user is visiting. These can be linked via ads or other touchpoints through the website. The user might not opt-in for these cookies, but for digital marketers information that is collected like location, device used, previous searches, etc, can be crucial to create customer profiles to provide customised targeted ads based on their online behaviour and browsing history.
While third-party cookies have been beneficial for many brands and publishers to provide more personalised online experiences, general users don’t appreciate intrusion into their privacy and the lack of transparency. Whether one likes it or not, people are constantly logged into the digital space with their devices. When they are leaving their digital footprints everywhere, they don’t want their crumbs to be picked up by savvy digital bandits but they are more cautious about their privacy due to having limited control over their personal data and how it is being used. Due to growing concerns, landmark legislations like the European Union’s General Data Protection Regulation (GDPR) and the California Consumer Privacy Act (CCPA) were introduced to protect consumer privacy.
Security has also been cited as another important reason for consumer protection for pushing the tech giants to become cookieless. The recent instances of data breaches in Australia where corporations like Optus, Medibank, and a few government divisions were hacked into have made users more vigilant about their privacy than ever before. Below are the key highlights from the Australian Community Attitudes to Privacy Survey 2023, conducted by the Office of the Australian Information Commissioner (OAIC):
- 62% of Australians see the protection of their personal information as a major concern
- 32% feel they are in control of their data privacy, whereas 84% want more control and choice over the use of their personal information
- 74% feel data breaches are one of the biggest privacy risks they face today
- 58% respondents feel they do not know what organisations do with their data, but a whopping 92% felt that organisations collecting data should do more to protect their personal data
- 91% of people are concerned about their personal data being sent overseas
Reduced Marketing Dollars/Revenue
79% of APAC brands rely heavily on third-party cookies. That’s not surprising as this data fuels advertising across the worldwide web today. It works as a guideline for digital marketers on how, when, where, and why ads should be run – essentially highlighting a dashboard of metrics to determine what’s working vs not, to curate targeted ads of products and services for individual users. Brands with the biggest ad spend and with a higher percentage of it relying on third-party cookies will risk losing the most amount of revenue. And for brands whose primary driver of sales is digital advertising, revenue risk is even higher.
Going cookieless can also impact return on ad spend (ROAS) if these cookies are vital to optimising ad performances and other data insights. Most brands tend to use attribution to determine the effectiveness of digital marketing campaigns, which is heavily reliant on third-party cookies. Attribution influences how campaigns can be better optimised for spend, tactics, frequency of ads, content, and more, on various customer touch points. Once the cookies are turned off, tracking these consumer touch points will become harder across digital platforms. Without the insights provided by third-party tracking cookies, online impressions are worth significantly less and brands might end up paying for ads that don’t receive any clicks. All these ultimately threaten the success of online advertising for brands and the economic model of publisher partners who depend on ad revenue to fund their content.
Half of Australian Brands are Not Ready for Cookie Deprecation
Although third-party cookie deprecation is looming on the horizon, from a survey conducted by Adobe in 2023, 79% of brands across APAC relied heavily on third-party data. A summary of the research concluded:
Overall APAC brands:
- 80% of respondents said the demise of third-party cookies will hurt their business
- 81% rely heavily on third-party cookies because they’re very effective
- 38% of leaders cite a lack of urgency to change their marketing strategy
Australian respondents only:
- 54% of Australian respondents indicated that the demise of third-party cookies will hurt their business
- 23% of Australian respondents believe that cookies are not going anywhere
- 56% of brands don’t have access to resources to evolve their digital strategies
Despite the challenging times ahead, the digital advertising market in APAC is still expected to grow by 13.25% over 2023-24, adding $2.87B USD over the next decade. For brands and agencies alike, preparing and adapting their strategies without the reliance on cookies is one of their top priorities. According to Quantcast’s Asia Pacific 2023 Advertising State of Play Report, 60% of agencies and 43% of brand-side marketers in APAC are preparing for this huge milestone change from Google this year.
Options to future-proof your partnership campaigns
- Direct integration of the Partnerize Tag
- eCommerce platform extensions
- Install Server-to-Server tracking
- Consider using Google Tag Manager
Brands and marketers realise that they are up for a tough ride ahead. Understanding the role of adapting to a world of no third-party cookies will be crucial for developing strategies to measure ad effectiveness, delivering ROI and ROAS, and customer retention. Cookies aren’t going away completely, they still have the first-party data to rely on that is collected through direct customer interactions via various channels. Having said that, it can be hard for marketers to achieve this alone. It’s necessary to engage with the right technology provider to deep dive into the analytics, help navigate, and provide the necessary support to de-silo the data and help create actionable strategies and personalisation.
Partnerize has taken steps to educate marketers on the risks associated with the deprecation of the third-party cookie and provided steps to ensure future-proofed partner channel tracking despite ongoing changes. Visit the hub for an overview of browser changes, more information on the urgency to take action when it comes to consistent tracking infrastructure, and the solutions developed by Partnerize to support profitable growth.
