Don’t Be Fooled: The Cookie’s Encore Is Still the End of the Show
After years of planning and industry fretting, Google has called third-party cookies back to Chrome’s stage. But make no mistake: Even though third-party cookies might be getting an encore performance, the show is still over for this legacy advertising identifier.
It’s OK for digital advertisers to make the best of the cookie’s encore while it lasts. However, they still need to know the plan for getting home from the show once the lights come up. Fortunately, in recent years, that plan has come into crisper focus for our industry. Here’s what you need to know.
The Clock Is Still Ticking on Third-Party Cookies
The limitations of third-party cookies had been well-documented within our industry even before Google announced it would be pulling the plug on them. In the intervening four years, those limitations have become significantly more crippling. Consider:
Consumers exist in cookieless environments.
Third-party cookies have always served limited use cases, granting visibility into only the portion of a consumer’s life that they spend within a web browser (and not even all the web browsers). That portion has been shrinking for many years—and it has continued to decline in the years since Google started exploring full cookie deprecation. At the same time, consumers are spending more and more of their media time within cookieless environments, including mobile apps, connected TV, and others.
In other words, regardless of what Google chooses to do with cookies, their utility as a targeting and personalization tools is already severely limited. Reliance on them within campaigns means marketers are willingly turning a blind eye to a growing number of consumers and a growing portion of their time spent with media. This deficiency of cookies will continue to become more pronounced.
Cookies will increasingly underperform.
Beyond the natural and continued shift from consumers into cookieless environments, we are also going to see active degradation of consumer signals via third-party cookies in Chrome. Although we don’t yet have all the details on Google’s go-forward plans, we do know that consumers will be given more control, either via opt-in or opt-out mechanisms, as to whether they allow third-party cookies to track their behavior on the browser.
We’ve been here before with consumer control over tracking, and we know how this story goes: Many consumers will either actively opt out of tracking or just not opt in. Over time, as we saw with Apple’s IDFA, signals provided by this identifier will become weaker. As it increasingly underperforms other solutions in the market, the costs associated with cookie-driven tracking and targeting will cease to make sense.
If you’re an advertiser who is well-served by third-party cookies’ very narrow and specific use cases right now, it makes sense to continue to incorporate them into your targeting and personalization strategies until they’re gone. But in doing so, you must be aware of their dwindling relevance and ensure you have plans in place to backfill that value—today, not tomorrow.
New Tools Are Ready for the Spotlight
This good news in all of this is that the marketplace is prepared for the loss of cookies. Google’s threatened deprecation kicked post-cookie preparation into a higher gear than it might naturally have achieved had cookies just been allowed to continue on their natural path to irrelevance. In that sense, we should thank Google for its four years of misguided warnings.
Here’s what’s going to take the place of cookies in the coming years:
Second-Party Data Closed Loops
The future of identity will lean heavily into collaboration. Going forward, the industry is going to find increased value in arrangements in which advertisers, media companies, and retailers share their first-party data using modern “data lake” clean room setups. The merged privacy-compliant data will offer advertisers a precise way to segment, activate, and measure consumer behaviors.
Artificial Intelligence
We can’t talk about the future of digital advertising without discussing advances in artificial intelligence—advances that are exceptionally well timed with the shift to a privacy-first regulatory reality. As traditional identifiers become obsolete, AI-driven solutions are stepping in to fill the gap. AI can analyze vast amounts of data to identify patterns, predict behaviors, and create highly accurate user profiles without compromising privacy.
Synthetic data is a clear example of how AI will generate the insights needed to replace identifier-based marketing. Synthetic data is artificially generated data that mimics real-world consumer and market data but does not directly originate from actual events or individuals. Such data is privacy-safe by design and unlimited in terms of its capabilities to help marketers plan, execute, and measure across media touchpoints and sales channels. Furthermore, its accuracy is constantly improved by machine learning. For this reason, these statistical models, also known as “digital twins,” will emerge as the new standard for large-scale precision marketing.
Personal Assistants
Expanding on the importance of AI, we also need to talk about the growing incorporation of AI into people’s daily assistants (e.g., Siri, Google, and Alexa) and just how powerful that combination is going to be moving into the future. As science fiction has long predicted, people are becoming increasingly comfortable chatting with and receiving help from the digital assistants that live in their pockets and around their homes. As the capability of these assistants improve, so will the interactions we have with them.
We can’t underestimate the new streams of privacy-compliant data and insights that these assistants will be capable of unlocking as they gain insight into our daily living, working, and shopping habits. In time, these windows into people’s activities across all their devices will become more complete and powerful than the third-party cookie ever was on its best day.
Ultimately, Google’s decision to continue support for third-party cookies doesn’t reverse any of the progress or planning of the past four years. It simply reframes it. There’s no going back to a time when third-party cookies represented the singular tool needed to power targeted, personalized campaigns; those days never really existed anyway.
Together, data collaboration, AI, and digital assistants will offer the privacy-compliant and ethical solution for targeting, planning, and customization of content that marketers have long desired. That’s where we’re headed. There’s no point in looking back.