It’s finally happened. After years of “will they won’t they” speculation within the digital marketing industry, it’s clear that third-party cookies are being withdrawn from Chrome. Our cookieless future is coming quickly into view. First, Google published a firm timeline. The company will disable tracking cookies for 1% of Chrome users in the first quarter of 2024, before doing the same for the remaining 99% of users by the year’s close. Second came the news that Google is rolling out Privacy Sandbox APIs to Chrome users (the Privacy Sandbox is Google’s attempt to create a privacy-preserving alternative to third-party cookies). With tracking cookies already deprecated on Edge, Mozilla, and Safari, we can now take it as given that the time is up for this invasive technology so at odds with our privacy-conscious age. But how will this change affect advertisers and publishers?
At first glance, the prospects don’t look good for the digital advertising industry. Third-party cookies have been the linchpin of digital advertising for many years, enabling advertisers to track users across multiple websites. These small pieces of data, stored in a user’s browser by websites, enable advertisers to build comprehensive profiles based on users’ browsing habits, interests, and online activity.
This treasure trove of information allows advertisers to deliver highly relevant and personalised ads, increasing the likelihood of engagement and conversion. As people move across different sites, third-party cookies help to recognise them, ensuring that the ads they see are tailored to their preferences and past online actions. Cookie deprecation puts at risk the ability of advertisers to reach the right audience at the right time with the right message. As a result, publishers fear that digital ad revenue may dry up as its value to advertisers decreases.
However, such fears are misplaced. Alternatives to third-party cookies have already emerged that will help create a much more effective programmatic advertising ecosystem. Advertisers and publishers should be rubbing their hands in anticipation of future improvements.
One such innovation is the emergence of progressive, privacy-first IDs, with telco-verified IDs being the best of the bunch. Telco-verified IDs leverage privacy-by-design principles to enable brands and publishers to build rich 360-degree profiles of consenting web users without tracking them and without transmitting personal data.
In this approach, consented first-party cookies from brand and publisher sites serve as an ID that can be verified using telco intelligence to ensure the user is always recognised within the same site or publisher group. The user is neither tracked nor identified. All that takes place is an anonymous verification that allows for accurate, real-time, cross-domain and cross-device user recognition to improve the customer experience.
Next, a transaction ID is used to activate campaigns. Generated for each individual ad request, the transaction ID is used by the buy-side to exchange for a specific audience in real-time. This enables multiple publishers and brands to deliver accurate first-party audiences to relevant marketers.
The fundamental benefit of this approach is that it means advertisers can reach the right audience, with the right message, at the right time on the open web, even after cookie deprecation is complete. That’s big. It means that the programmatic ecosystem can continue as it is today, and publishers’ business models will remain intact.
The other obvious benefit is that the approach is privacy-centric. That means it’s fully compliant with global privacy laws such as GDPR and the emerging ePrivacy Regulation and meets growing consumer demands for privacy-conscious online practises. That’s important because consumers are increasingly willing to switch to companies that respect their privacy.
However, there are other benefits that make telco-verified IDs more of an improvement to than a replacement for tracking cookies. First is the accuracy of the technology. The attribution accuracy of third-party cookies is not actually that good, with consumer identity match rates of between just 40% and 60%. Telco-verified IDs on the other hand are 100% verified at source and so advertisers can be sure they are reaching their exact audiences.
That’s a huge benefit for advertisers as it both improves ROI for ad campaigns and reduces the likelihood of ad fraud as advertisers can be sure real people are seeing their ads and not bots. What’s more, because telco-verified IDs work across devices, advertisers can use them to retarget users. This further improves the ROI of campaigns within owned digital properties and the open web.
For publishers, telco-verified IDs means that they can command premium ad-inventory prices by providing first-party audiences for brand advertisers. They can also use the approach to build deeper profiles of their users to help with their own customer engagement.
It has been a long road getting here, but we really are living in the dying days of tracking cookies. The web that’s emerging is better for consumer, advertisers, and publishers alike, promising safer and more effective programmatic advertising. The cookieless future can’t come soon enough.