a cookie being eaten to represent a cookieless future for marketers

A Cookieless Future: How to Prepare Your Business

By Jason Carroll · Published October 4, 2023

The digital marketing landscape is undergoing a seismic shift. If you haven't heard, Google is saying goodbye to third-party cookies to address data privacy concerns. And if you’re wondering how to combat a cookieless future, this is where you need to be. 

The move by Google is a component of its broader initiative called the Privacy Sandbox — which seeks to create web standards that allow websites to access user information without compromising privacy.

Naturally, this presents a daunting challenge for marketers. Once third-party cookies disappear, marketers will need new ways to run personalized ad campaigns and track user data, disrupting audience engagement, segmentation, and retargeting strategies.

So it’s no wonder many were relieved when Google extended the phase-out timeline to the second half of 2024. This offers a buffer period for businesses to recalibrate their approaches to data collection.

What is a Third-Party Cookie?

Understanding third-party cookies and why they have been vital for digital marketing is essential. 

Third-party cookies are pieces of data stored on your computer by a website or domain different from the one you’re currently visiting. In simpler terms, these cookies come from an external source other than the website you're interacting with directly.

Here’s an example of how third-party cookies work.

Imagine browsing a news website and seeing embedded options to 'Like' or 'Share' an article via LinkedIn. You share the article, and from then on, notice the brand popping up in your LinkedIn feed daily.

That’s happening because even though you weren’t on LinkedIn’s platform, clicking those buttons installed a third-party cookie onto your computer. From there, the cookie will track you subtly until deleted. 

Some of the information third-party cookies collect about users include the following.

  • Geographic location
  • Interests and preferences
  • Online purchases
  • Web browsing history
  • Most visited sites

Such data helps marketers build comprehensive user profiles to tailor marketing campaigns, delivering highly personalized user experiences.

Marketing in a Cookieless Future

The thing is, Google holds a staggering 83% search engine global market share.

And considering its dominance, the move to phase out third-party cookies will set the tone of digital advertising for many years.

That also means the cookieless era isn't just about adapting; embracing a paradigm where data privacy takes center stage is vital.

Marketers will need to abandon old habits and rethink their strategies. They must balance the drive for personalization with the imperative of earning consumer trust through transparent and secure data practices.

But this shift also offers an opportunity for innovation. It's a call to action to evolve and develop more direct, privacy-friendly methods for engaging audiences.

How To Prepare for Cookieless Future: 6 Proactive Things To Do

While Google has pushed back its timeline, the clock is still ticking, and complacency now could mean big trouble later. So, use this extended period to reimagine and retool your marketing strategies.

Here are six steps to proactively adapt and position your brand for success.

1. Evaluate Your Existing Marketing Approach

Assess your current marketing tactics thoroughly before diving into alternative solutions. Pinpoint the various aspects of your strategy that rely on third-party cookies and identify ways to replace them. 
For example, if third-party cookies power website personalization, consider using first-party data instead. Similarly, if you’ve been using 3rd party cookies for retargeting, now might be the time to explore contextual advertising.
Here are some general steps.
  • Conduct an inventory: List all marketing channels and tools, highlighting those reliant on third-party cookies.
  • Assess impact: Rank the channels by how critical third-party cookies are to their operation.
  • Explore alternatives: Research non-cookie-based methods for each high-impact area.
  • Data mapping: Pinpoint where first-party or second-party data can be a substitute.
  • Legal and compliance check: Ensure new data collection methods comply with privacy laws like GDPR and CCPA.
  • Run pilot tests: Test alternative solutions on a small scale if possible.
  • Monitor and adjust: Continuously track the performance of new tactics and adjust as needed.
Auditing your strategy should be the first step to preparing for a cookieless future.

2. Harness the Power of First-Party Data

While losing third-party cookies will make data collection more challenging, you still have first-party data. This is data sourced directly from interactions on your website or a platform you control (e.g., subscriptions, purchase histories, email activity, etc.).

Some advantages of first-party data include the following.

  • More accuracy: Since first-party data is gathered directly from your sources, it’s often highly accurate and relevant to business objectives.
  • Greater control and customization: You have more control over how the data is used and analyzed.
  • Privacy compliance: You can obtain explicit consent for using first-party data more efficiently.
  • Lower cost: Using your first-party data eliminates the need to buy from external vendors, reducing overall marketing costs.
  • Enhanced personalization: The specificity of first-party data enables highly personalized customer experiences.
  • Trust: Customers are more likely to trust data collection processes when they are transparent and come from a primary source with whom a relationship exists.

Now is the ideal time to refine your first-party data collection methods well ahead of Google's cookieless shift. Take this opportunity to dive deep into how visitors engage with your site or app and their preferred transactions. 

You can also investigate methods for enhancing first-party data collection. For example, you can allow user registrations and implement single sign-on (SSO), allowing visitors to log in via their Google, Facebook, and other accounts.

Similarly, you could introduce modern applications designed to collect first-party data from your website, like Bread & Butter or HubSpot.

You can also adopt progressive profiling techniques. This is when you examine firmographic, demographic, and psychographic data that reveal insights about customer segments.

Are First-Party Cookies Also on the Chopping Block?

Current indications suggest that first-party cookies will remain relevant.

Plus, legislative developments in Europe offer further assurance. Regulators are considering a new proposal under the ePrivacy Regulation that may replace the existing ePrivacy Directive, commonly known as the EU Cookie Law.

The proposed regulation takes a more lenient stance on cookies that are less intrusive and enhance the user experience online.

It suggests consent might not be necessary for these types of cookies, including essentials (e.g., session cookies, authentication, user input, etc.) and some non-essentials (e.g., analytics, customization, etc.).

These developments strongly signal that first-party cookies aren’t under immediate threat.

3. Explore Second-Party Cookie Partnerships

Second-party cookies are first-party cookies shared between two different domains or companies through a strategic partnership.

For example, if your company specializes in video production, consider partnering with an entrepreneurship blog.

By doing so, you can access their first-party data, such as email addresses or demographic information. Then, use that information to target potential customers, transforming it into second-party data.

In addition, the scope of second-party data collaborations can go beyond one-to-one partnerships. For instance, a shipping company can establish data exchange networks involving multiple businesses, such as packaging companies.

4. Revisit Contextual Targeting Strategies

With contextual targeting, ads display on a website or platform based on the page's content. The idea is to present ads relevant to the page's content and, therefore, more likely to be of interest to the audience viewing it.

For example, someone reading a travel article might see airline, hotel, or trip insurance ads. This type is called the topic contextual strategy.

Other contextual targeting strategies include the following.

  • Category: This method places ads based on broad categories. It's a straightforward approach but may lack the detail needed for highly targeted advertising.
  • Keyword: With this approach, ads display on web pages that feature target keywords specified by the advertiser. This allows for greater flexibility and more accuracy in ad placements.
  • Semantic: This advanced form of targeting uses machine learning to analyze a page’s entire context and sentiment. It can offer highly accurate ad placements but usually requires a more sophisticated setup.

Using contextual targeting can immediately make your service or product relevant to the audience.

5. Explore Opportunities with Cohort-Based Marketing

Another intriguing avenue is cohort-based marketing, mainly through Google's Federated Learning of Cohorts (FLoC) initiative.

Here’s how it works.

  • FLoC uses open-source technology to analyze web browsing histories locally.
  • It groups people into cohorts based on their similar browsing activity. For example, one cohort might consist of users interested in gardening and travel, while another may be art supplies, cooking, and hiking.
  • The browser determines which cohort someone belongs to based on their recent web browsing history.

This approach allows for targeted advertising while maintaining high user privacy.

There are several improvements to privacy, including the following.

  • Individuals are part of a large crowd (cohort) with similar browsing history, which should increase privacy.
  • The personal browsing history is processed locally and never leaves the browser, making FLoC more private than traditional tracking methods.

Also, FLoC uses first-party and third-party data to create cohorts. So even when third-party cookies go away, FLoC remains a viable solution.

6. Monitor Emerging Solutions for Audience Addressability

Keep an eye out for new and innovative solutions. They will continue emerging as we approach the end of third-party cookies.

For example, the following methodologies are gaining traction.

Probabilistic Targeting

This approach uses metadata from users' devices, such as their browser type and internet connection speed, to make educated guesses about their preferences and behavior. Though less precise than cookie-based methods, probabilistic targeting can still provide valuable insights.

Walled Gardens

Walled gardens are ecosystems where user activity is closely monitored but not shared outside the platform.

In other words, these platforms are closed systems (think Facebook, X, TikTok, etc.) able to maintain a significant degree of control across their ecosystem regarding data. They are a rich source of user information for targeted advertising within the given platforms only.

Authenticated Data Collection

Another approach involves gathering data from users who have authenticated their identity, usually through account sign-ups or subscriptions. This first-party data comes with the user's explicit consent, which aligns with the focus on data privacy.

Is "Cookieless" A Misnomer?

The term "cookieless" might be somewhat misleading. It insinuates a future that’s devoid of cookies, though first-party and second-party cookies are far from facing extinction.

However, their functionality will differ. These cookies will primarily focus on improving user experience on individual websites rather than enabling marketers to track behavior across multiple sites.

In short, ‘cookieless’ only refers to the phasing out of third-party cookies. Maybe marketers will start referring to their demise with something else in the future.

Who Stands to Lose the Most in a Cookieless World?

The looming discontinuation of third-party cookies raises questions about its true impact. While it’s a move toward a more secure and private internet, one cannot overlook that Google and other tech giants already hold vast user data.

So, the absence of third-party cookies won't be a hurdle, particularly for Google, as it already has robust data collection mechanisms.

Ironically, other businesses — especially small and medium-sized enterprises — may find themselves at a significant disadvantage. You could argue that Google's shift away from third-party cookies places small companies in a position where they must increase their reliance on Google-centric solutions.

The outcome could be a tightening grip by tech giants on the digital advertising landscape.

Start Preparing for the Cookieless Future Now

Marketers must be agile and adaptable as digital marketing continues its rapid evolution. Failing to do so could jeopardize your brand. Therefore, you should begin preparations for a Cookieless future now.

Not to mention, there’s growing momentum around data privacy regulations globally. So, regulators may introduce more stringent data privacy rules. Getting ahead of these changes can help you avoid compliance issues and provide a competitive advantage.

Lastly, remember to keep informed about emerging solutions that can improve marketing efforts and outcomes. Companies that adopt alternative strategies early will have more time to test and optimize new methods of targeting and personalization. 

It also allows thoughtful planning in adapting your technology infrastructure for a smooth transition. Build a data collection strategy that’ll carve a path to thriving in a cookieless world.

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Jason Carroll

Jason is the founder of JC Digital, a lifelong storyteller and performance marketer who has helped add $100M+ in revenue to consumer brands over a decade in the industry.

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