Third Party Cookies are being phased out - what does this mean?
Before we jump into what’s happening with Third Party Cookies, here’s a quick refresher:
What Are Third-Party Cookies?
Third-party cookies are small data files set by a domain other than the one you’re currently visiting. For instance, if you visit a website and it has ads served by a different domain, that ad provider might place a cookie on your browser. These cookies allow third-party companies to track your behavior across different websites, building a profile that can be used for targeted advertising.
What’s happening with Third Party Cookies?
Third-party cookies have been a central tool for online advertising and tracking user behavior across websites, but significant changes are occurring that will impact how they are used—or not used—in the future. Here's a breakdown of what's happening with third-party cookies and what it means for users, advertisers, and the broader digital ecosystem.
1. Phase-Out by Major Browsers:
Google Chrome: Google announced its intention to phase out third-party cookies in its Chrome browser by late 2024. Chrome is the most widely used browser globally, so this move is particularly significant.
Apple Safari: Safari has already implemented measures to block third-party cookies by default through its Intelligent Tracking Prevention (ITP) technology.
Mozilla Firefox: Firefox also blocks third-party cookies by default as part of its Enhanced Tracking Protection (ETP).
2. Regulatory Pressure:
The General Data Protection Regulation (GDPR) in Europe and the California Consumer Privacy Act (CCPA) in the United States have imposed stricter rules on data privacy and user consent, making the use of third-party cookies more challenging from a legal standpoint.
3. Shift to First-Party Data:
As third-party cookies become less viable, there’s a growing emphasis on first-party data—information that companies collect directly from their users through their own websites or apps. First-party data is considered more reliable and privacy-compliant.
4. Emergence of New Tracking Technologies:
In response to the decline of third-party cookies, the advertising industry is exploring alternative tracking methods, such as:
FLoC (Federated Learning of Cohorts): Initially proposed by Google, this aimed to group users into cohorts with similar interests, reducing the need for individual tracking. However, it faced criticism and was eventually replaced by Google's Topics API, which offers a more privacy-conscious way of targeting ads based on general interests.
Server-Side Tracking: Some companies are shifting tracking activities to their own servers, bypassing the need for third-party cookies.
Contextual Advertising: This involves displaying ads based on the content of the webpage rather than user behavior, reducing the reliance on tracking cookies.
What Does This Mean?
1. For Users:
Increased Privacy: Users will have more control over their data and privacy, with fewer entities tracking their online behaviour across different websites.
Potentially Less Relevant Ads: Without third-party cookies, some users may see ads that are less targeted to their interests.
2. For Advertisers:
Need for Adaptation: Advertisers will need to adapt to new tracking methods and rely more on first-party data, contextual advertising, and other innovative approaches to reach their target audiences.
Greater Focus on User Consent: Advertisers will need to be more transparent about data collection practices and obtain clear user consent, as required by privacy regulations.
3. For Publishers:
Changes in Revenue Models: Publishers that rely heavily on advertising revenue may need to adjust their strategies, possibly focusing more on subscriptions, memberships, or direct deals with advertisers.
4. For the Digital Ecosystem:
Shift Toward Privacy-Centric Solutions: The broader digital ecosystem is moving towards solutions that prioritize user privacy while still enabling effective advertising. This shift will likely drive innovation in how data is collected, managed, and utilized in a privacy-compliant manner.
The phasing out of third-party cookies represents a significant shift in the online advertising landscape, driven by increased privacy concerns and regulatory pressures. While this change presents challenges, it also opens up opportunities for new, privacy-conscious methods of tracking and advertising. Users can expect greater control over their data, while advertisers and publishers will need to innovate to maintain effective marketing strategies in a post-cookie world.
Need help navigating this change? Reach out and lets chat!
