Third party cookies have powered the online advertising industry for decades, originally invented by a young engineer working at Netscape back in 1994. Now, as announced by Google, the most popular browser Chrome will phase out third party cookies by the end of 2024. This has seismic implications for brands, marketers, and anyone else involved in online advertising.
Cookies have been the backbone of targeted advertising since the 90s, allowing brands to create personalised content and track the behaviour of users. However, campaigning groups and legislators have recognised a growth of concerns about privacy and data protection. In response to the increased scrutiny of cookie usage, Google has taken the lead in redefining the rules of how advertisers and consumers engage with each other.
The phase-out of third party cookies will reshape how brands target and engage with their audiences. With the coming loss of this data, advertisers will need to explore alternative methods for delivering content. The era of hyper-specific, targeted ads (and jokes about Google Alexa spying on people) based on individual browsing histories will be replaced with more privacy-focused approaches, forcing brands and agencies to innovate their strategies.
Timeline of Changes to Third Party Cookie Usage
The deprecation of third party cookies had originally been planned for 2022, but changes to the initiative caused Google to push the effort back repeatedly. Partners were asking for more time to test and adapt to the now-immediate changes. Despite this, Google have said many people and organisations also quickly readied themselves for the switch anyway.
Opt-in testing began in Q4 2023 and will continue until Q3 2024, running in parallel with a 1% third party cookie deprecation: on the 4th January 2024, 1% of stable Chrome users were switched from third party tracking to Privacy Sandbox. This is an initiative aiming to protect user privacy whilst enabling effective advertising for digital businesses. With the change, that 1% of users will no longer be tracked across sites or apps, effectively eradicating the ability to send them targeted ads.
Google plans to fully disable third party cookies in Q3 2024 with minimal milestones.
The Ballad of Privacy Sandbox
Privacy Sandbox is the Google-led initiative to shift web standards away from the use of third party cookies. Through it, Google is aiming to limit covert online tracking techniques whilst still enabling growth for digital businesses. As a replacement for third party cookies, Privacy Sandbox offers new measurement and reporting tools, such as ensuring individual user data remains protected through grouping them into behavioural cohorts.
Furthermore, certain relevance and measurement APIs were made available to 50% of Chrome users in July 2023. According to Google, “the Privacy Sandbox APIs require web browsers to take on a new role. Rather than working with limited tools and protections, the APIs allow a user’s browser to act on the user’s behalf… to protect the user’s identifying information as they navigate the web”. This enables live testing for developers, and Google currently has no plans to change or overhaul the new system anytime soon.
Privacy Sandbox has been no stranger to criticism and controversy since forming in 2019. The Competition and Markets Authority in the UK accepted legally binding commitments from Google after the initiative’s plan to remove third party cookies from Chrome was found to have potentially wide-ranging implications on both publishers and users.
Furthermore, 15 attorneys general from both the US and Puerto Rico filed an antitrust complaint against Privacy Sandbox and claimed the retirement of third party cookies will disable the technology used by “almost all non-Google publishers”. Texas attorney general Ken Paxton went further, saying that Google has, “repeatedly used its monopolistic power to control pricing [and] engage in market collusions to rig auctions in a tremendous violation of justice”, It’s no wonder this topic is newsworthy, right?.
Developer Readiness and Testing
Navigating the phasing out of third party cookies will require web and app devs to prepare themselves. Developers need to work towards ensuring a smooth transition, maintaining the functionality of their websites or apps. If you’re a dev, ensure you’ve identified areas that are dependent on third party cookies and work out how (or if) you’re going to adapt to their absence.
Create testing environments that simulate real-world scenarios at scale, ensuring that alternative technologies (such as Privacy Sandbox) perform effectively. With increasing emphasis on data privacy, testing will be essential to check your new solutions are legally compliant — the last thing you want is to be accused of in the 2020s is breaching data privacy laws.
Impact on Advertisers and Marketers
The shift to a cookieless internet poses challenges for marketers, who have spent decades relying on third party cookies. Technologies such as Privacy Sandbox restrict the collection of specific user data, making it extremely difficult to target specific demographics or create personalised ads. We may see less consideration given to highly targeted campaigns. Without that personalisation of ads, shifts in how consumer trust and engagement are built will soon follow.
With so much less granular user data, tracking and attributing conversions is about to become much more challenging. Without the ease of measuring and assessing the performance of campaigns and specific marketing efforts, optimising strategies for better results could become a struggle.
Let’s not forget, however, the shift from traditional targeting to newer models could bring a new lease of life to advertising and marketing teams. Contextual advertising, machine learning, and first-party and zero-party data are all potential avenues for new advertising efforts in a post-cookie world, along with a move back towards native and sponsored content.
Effectiveness of the New Approach
New Protected Audience APIs are aiming to provide a privacy-focused solution for ad targeting. They allow advertisers to reach specific audience segments without exposing individual user data. These new APIs are effective in preserving user privacy while enabling targeted advertising. Advertisers can define audiences based on aggregated data, reducing reliance on personally identifiable information (PII).
The phasing out of third party cookies raises concerns about measurement and attribution. Marketers have traditionally relied on cookies for tracking user interactions and attributing conversions — but without third party cookies, measuring the effectiveness of ad campaigns through connecting user touchpoints across channels and devices becomes more complex. Furthermore, cookie deprecation will most likely lead to a less accurate understanding of conversions, with models such as last-click attribution depending on cookies.
While challenges exist, the industry is actively working on solutions to maintain effective targeting. With marketers and advertisers placing such a huge emphasis on privacy, metrics such as first and zero party data will soon be utilised much more commonly. Being willing to experiment, and accepting the new requirement for privacy, will simply be the norm going forward.
Future of Web Privacy and Tracking
Having relied on third party cookies for years, digital brands and their marketers will wake up to a completely different world later this year. The deficit of browsing behaviour and demographic data will lead to a loss of clarity for who our target audiences are.
I have my limits, though — I’m not okay with my online behaviour being tracked to such a level of detail that I can be very accurately profiled by total strangers. There’s no right or wrong answer to the issue of online privacy, and people’s tolerances are always going to differ on what they’re comfortable with. The retirement of third party cookies and the loss of targeted advertising on the world’s biggest browser was always going to satisfy some whilst disappointing others.
Long Term Implications for the Advertising Industry
Brands are about to find a total shift in how they understand and engage with their target audience. With the loss of individual data, a greater emphasis will have to be placed on context and cohort. Advertisers will need to soon develop creative ways to gather first party and zero party data. We may even witness increased collaboration among advertisers, developers, and publishers to develop new practices and platforms that are privacy-compliant. New standards for data usage will need to be established.
Furthermore, companies like Meta (and Google themselves) survive on advertising. I’m personally torn on what cookie deprecation means in the long term: is our concern over privacy worth some of the biggest and forward-thinking companies on the planet losing their dominant revenue stream? On the other hand, was it worth having access to these kinds of services for free if they turned us into the product through collecting our data?
Conclusion: The Path Ahead
We’re about to face a pivotal moment for digital advertising. Brands and agencies need to recognise this shift as both a challenge and an opportunity: it’s a sink or swim moment, marked by a greater demand for user privacy and transparency.
In the oncoming post-cookie era, there’ll be a pressing need to embrace new technologies and strategies. First-party data will become increasingly valuable, emphasising building direct relationships with consumers. Contextual advertising and machine learning could emerge as potential solutions to maintain effective ad targeting.
This kind of ongoing adaptation and innovation will soon be essential for any brand hoping to keep growing. By staying agile and adhering to these changing foundations, the future of digital advertising belongs to those most ready to embrace a world without cookies.