Third-party cookies act as trackers that follow users throughout their stay on a certain website, similar to a store’s security cameras. But instead of watching out for shoplifters, these cookies notice every little detail—from the links you click to the amount of time you spend on a web page. A single website could allow hundreds of cookies readable to third parties.
The data they obtain has shaped the digital advertising strategies of almost every company for decades. With Google’s impending disuse of third-party cookies in favor of its Privacy Sandbox, however, what would the world be like without third-party cookies?
What Does a Cookie-Less World Mean for Users?
Stopping the use of third-party cookies may not end privacy issues related to Internet use, but it is a major step toward more privacy-protected browsing experiences.
More Private Browsing
To users, an Internet session without third-party cookies would be more private. Some may even argue that letting go of trackers would be the most ethical thing for advertisers to do. For years, end-users have struggled with the reality that companies can obtain their data every time they open their browsers. How this information is stored and utilized is always a cause of concern.
In 2011, the European government listened and implemented the “cookie law” throughout European Union (EU) member countries. In a nutshell, the cookie law is an EU directive that gives users the freedom to refuse to accept third-party cookies.
Moreover, the directive compelled website owners to specify clearly what kind of cookies are on their sites, how the data would be stored and used, and to obtain visitors’ consent.
A Slow but Purposeful Move Away from Trackers
The cookie law is set to undergo revisions, as recently agreed upon by EU lawmakers. For one, it would have to be aligned with the General Data Protection Regulation (GDPR).
But almost a decade after the directive was initially implemented, Google announced that it would soon stop using third-party cookies and instead employ its own Privacy Sandbox. In its simplest form, Privacy Sandbox is a set of privacy-focused tools and techniques.
In hindsight, such a move is inevitable with the increasing regulations that protect user privacy. The development goes to show that governments could be made to act, given enough public clamor.
Aside from that, Firefox and Safari already started blocking third-party cookies automatically, so users didn’t have to worry about cookie-related privacy issues. If it helps, the timeline below shows the slow yet purposeful move against third-party cookies.
What Does a Cookie-Less World Mean for Advertisers?
Without third-party cookies, advertisers would need to change their strategies. To some, this could mean a complete overhaul of their systems. Understandably, some advertisers are reeling. How can they deliver targeted ads without tracking users?
From the Targeted to the Interest-Based Approach
Google is moving toward an interest-based approach in advertising by exploring Federated Learning of Cohorts (FLoC). And advertising may have no choice but to follow suit. Instead of targeting people based on their individual behaviors, FLoC enables advertisers to target groups of users with similar browsing interests and behaviors.
Compared with employing third-party cookies, this approach would be less invasive, and initial tests reveal that it could be as effective. According to Chetna Bindra, Google Group Product Manager, User Trust and Privacy, tests resulted in at least 95% of the conversions per dollar spent.
Interest-based advertising isn’t new. Companies like Facebook already allow advertisers to target customers based on the categories they are interested in.
From Third- to First-Party Data
Ultimately, the disuse of third-party cookies encourages advertisers to utilize first-party data instead. The Interactive Advertising Bureau (IAB), an advertising organization composed of tech companies, brands, and publishers, launched Project Rearc in February 2020. The project proposes the use of new identifiers, such as email addresses and phone numbers, instead of third-party cookies.
While Rearc is still in its early stages of development, the possibility of capitalizing on first-party data isn’t far off. Technologies, such as machine learning (ML), already allow companies to collect data and build their own data sets. However, it’s important to comply with privacy regulations while collecting first-party data.
The move away from third-party cookies is proof that technology constantly evolves. More specific developments may be announced in the coming months, and companies must be ready to adapt to any change, whether small or as major as the scrapping of third-party cookies.