A Technical Dive into the Cookie Apocalypse
Marketers are aware that 3rd party cookies are rapidly declining in efficacy, and individual-level tracking is becoming less viable. In fact ~50% cited third-party deprecation as a top industry challenge.¹
While you know your ability to engage with customers is going to change, you might still have questions on what to do to prepare. Read on for actionable steps you can take to evaluate and prepare for implications of the death of the cookie.
Nearly half (49%) of US digital media professionals polled by Integral Ad Science in October 2020 cited third-party cookie deprecation as one of their top three challenges for the industry in the following 12 months.¹ It is critical to have an understanding of what is changing within the cookie ecosystem as it relates to measurement tools and ad-buying platforms in order to prepare effectively. Beyond understanding the technical changes, marketers must also take actionable steps to prepare for what is to come.
What is Changing?
Browsers and devices (e.g. iOS) are taking steps to reduce individual level targeting. (For more information on iOS changes, read Ovative’s article iOS 14.5 Has Arrived.²) This includes eliminating the ability to drop third party cookies in browsers and establishing options for users to reject app tracking on devices. In effect:
- Third party cookies will be almost entirely phased out over the next two years
- First party data will still be usable, but applications will become more limited
Impacts to the total marketing and measurement stack are significant enough that marketers need to be taking a hard look at some major risk areas including measurement tools and ad-buying approaches.
Impact on Measurement Tools
- A 2019 Gartner report stated that marketing leaders are only achieving 58% of potential impact from their marketing technology stack.3 We believe this trend will continue as third party cookies phase out, leaving marketers unsure of where and how to invest in marketing technology.
- Tools which attempt to stitch together user data across multiple sites (such as MTA solutions) will be greatly impacted and less viable for data which is collected offsite, such as impressions. Click paths collected via data such as query string parameters onsite will still be viable, although they may create issues in measuring channel efficacy.
- The impact to measurement tools and on-site functionality which relies solely on first party data (such as site customization based on logged in users) will be considerably less, however implications may appear over time so marketers should keep an eye on the evolving situation (this includes tools such as web analytics).
- As such, the importance of non-customer level tools for evaluating cross-channel influence will continue to increase. This includes more companies moving to Unified Marketing Measurement tools like Ovative’s Marketing Analytics Platform (MAP), Media Mix Modelling (MMM), and incrementality testing to help measure even as cookie degradation accelerates.
Impact on Ad-Buying Platforms
- All individual-level targeting will become prohibitively difficult for clients with small first party data sets. The more data you have, the easier it will be to target.
- Platforms will lose the ability to target individual users outside of first-party data sets (e.g. individual look-alike audiences) at scale. There will be ways to continue to target first party data sets, but they will become more difficult to execute.
- Media platforms rely on identity graphs to attribute conversions that allow marketers to optimize campaigns in real time, but that capability will become increasingly difficult since ad-buying platforms (by nature) do not have first party relationships with consumers.
What Should Marketers Do About It?
There is no clear solution for replacing cookie-based marketing, and instead marketers need to be thinking about how marketing strategies will adapt to this new normal. Here is what we recommend doing next:
- Evaluate how your marketing strategy will be impacted by cookie degradation. Then, consider how elements of your strategy and technology stacks will need to be adapted to the new normal in order to turn this threat into an opportunity. An example of this would be to evaluate your display retargeting strategy, as cookie degradation will impact this tactic significantly.
- If your marketing stack is centered on MTA, you should already be accounting for gaps in your ability to see customer paths. Whether you have already made this shift or are planning to do so, data availability is going to decline throughout this year, and you should be exploring alternative solutions.
- Use top-down planning tools like MMM or tools that combine both approaches such as UMM, rather than MTA tools. For information on Ovative’s proprietary UMM tool, Marketing Analytics Platform (MAP), visit ovative.com/MAP.
- Have a conversation with your partners. Whether directly with publishers or with your marketing measurement vendor, ask them what solutions they are pursuing to stay ahead of the death of the cookie. Marketers should look for partners that have future-proofed solutions in place and who are willing to be transparent about their current risks and plans associated with this industry change.
- Be patient. Marketers are in a holding pattern until the industry figures out what is next. While Google and other publisher cohorts are actively discussing solutions, nothing has been solidified yet. Marketers will need to be patient as the ad-tech and publishers work with the browsers, apps, and operating systems to establish a new norm.
For more actionable steps, read our recent article on how you can embrace the cookie apocalypse.4
Marketers have found ways to reach and engage with consumers dating long before cookies were available and will continue to do so once they are phased out. The key is preparation and aligning your measurement strategy with budgeting and planning processes to ensure that investment is happening in the right places and at the right time. For help in evaluating your organization’s preparedness for these technical implications, contact us. Not ready to talk yet? Learn more about us at Ovative.com/MAP!
Ovative is a digital-first media and measurement firm seeking to transform the measure of marketing success. At Ovative, we help brands move the needle. We are curious. We value your brand. We want to see you succeed. Connect with us to learn more!