Cookieless Future: Q3 2023 Update by Yieldbird

In January 2020, Google dropped a digital bombshell: third-party cookies in Chrome were on the way out. It was a move that sent ripples through the online advertising universe, driven by Google’s mission to fortify user privacy and security amid a tightening regulatory landscape. Fast forward to today, and publishers are on the brink of a cookieless era, where innovation and adaptation are the keys to survival. 

Join us on this journey and discover what will happen in the near future regarding cookies and the consequences of these changes. Furthermore, gain insights from Yieldbird’s experts on strategies for publishers to thrive in the evolving terrain.

Chrome’s Deprecation of Third-Party Cookies – Key Consequences

Even though we know that third-party cookies will be gone soon, many companies are not aware of the real consequences of this event. What actually will we be facing?  

1. Limited Tracking and Targeting 

Advertisers will have less detailed information about how users behave online without third-party cookies. This makes it harder to follow users’ online paths and show them ads based on what they’ve looked at before. Figuring out how well ads are doing, where they come from, and the return on investment (ROI) will be tougher. Marketers will have to find new ways to measure and use advanced analytics to see how their campaigns are working.

2. Shift Toward First-Party Data and Walled Gardens

Advertisers will depend more on the information they get directly from users on their websites. This info can cover user sign-ups, what users like, and how they interact with the website. Making good use of this ‘first-party data’ will be super important for showing ads that fit each user. Big tech companies like Google, Facebook, and Amazon, who already have a lot of this kind of data, will likely get even stronger in the ad world. Advertisers might have to put more of their money into these platforms.

3. Risk of Lower Revenues as User Match Rates May Drop By 30-40%

Users’ choices (whether they agree to their data being used for advertising) have already made it harder to reach them with ads. And when third-party cookies go away, especially on popular browsers like Chrome, it’ll make it even tougher to find and connect with users.

4. Emerging Privacy-Focused Ad Technologies

Companies in the advertising tech industry are working on privacy-friendly technologies to help advertisers connect with their desired audience without using third-party cookies. These solutions include Universal IDs, Privacy Sandbox APIs, and Seller Defined Audiences.

Timeline of Cookieless Chrome

So, what should we expect in the upcoming months? In Q3, we bid farewell the final Origin Trials for Sandbox proposals and usher in the General Availability phase. During this period, Chrome allows developers to carry out real-time testing as they gear up for the shift away from third-party cookies. No major API alterations are on the horizon before the cookie phase-out. There will be two parts of the process.

Mode A

In Q4 2023, APIs are available. Chrome will not disable cookies just yet, but developers can simulate third-party cookie deprecation for a chosen percentage of their user base, enabling controlled testing.

Mode B

Then, in Q1 2024, Google intends to phase out third-party cookies for one percent of Chrome users. This allows for real-world testing of products coping without cookies.

Google encourages industry-wide engagement on the Privacy Sandbox and invites developers to adopt and test the APIs as part of end-to-end solutions. They will provide more details and guidance on testing metrics and methodologies in the coming months. They express their commitment to working with the industry to improve privacy on the web as they approach the final stages of third-party cookie deprecation in Chrome.

What’s new in Privacy Sandbox?

Protected Audience API – Google’s Retargeting Alternative

The new name for FLEDGE marks its move from an experiment to a practical feature. It’s built to manage interest-based ad auctions while safeguarding user privacy. It works by making specific ad decisions right within the user’s browser instead of on a server. This means user interest data doesn’t have to be sent to external servers, which boosts privacy.

Privacy Sandbox Demos

A new website showcasing demos of different Privacy Sandbox APIs could feature interactive examples or simulations demonstrating how these technologies work in real-life scenarios. This resource is a valuable tool for developers, advertisers, and other interested parties to grasp the functionality of the Privacy Sandbox and learn how to align their advertising strategies with these emerging standards.

What’s new in GAM?

Alongside Audience and PPIDs, Google Ad Manager has enabled two beta features:

• Publisher-provided signals – Google has implemented IAB’s Seller Defined Audiences.
• Publishers can use standardized taxonomies to communicate first-party audience attributes (behavioral and interest-based data) or contextual data.
• Two signal types are available corresponding to two IAB taxonomies: Audience and Context. Each has slightly different parameters that can be used to match publishers’ data to match the IAB category.
• Audience categories will only be passed on requests that allow for ad personalization.
• Contextual publisher-provided signals can be passed on all ad requests, making it a great way to uplift the value of this hard-to-monitize no-consent traffic.

Secure signals – Universal ID’s blind tunnel through GAM

• Google’s response to Universal ID rising significance for Authorised Buyers
• Publishers can share secure signals on RTB requests with third-party bidders
• Publisher can decide what Signals and which Bidders can receive it
• Universal ID scripts can be deployed by the publisher, Google, or Prebid ID module
• Signals can be passed only to Authorised buyers and Open Bidders
• All signals must be obfuscated/encrypted before passing to Google (which usually is by default on most ID providers – hashed emails, encoded IDs etc.)

Adapting to a Cookieless Future: Expert Advice from Yieldbird for Publishers

If you want to be fully prepared, here are a few pieces of advice from our experts that help you adapt to a new cookieless reality. 

1. Evaluate current data practices. Understand how third-party cookies are used for advertising on your website and what data you rely on for advertising, analytics, user experience, and engagement
2. Invest in collecting and leveraging first-party data from your website visitors. Encourage users to create accounts and subscribe to newsletters, allowing you to build a robust first-party data ecosystem.
3. Educate your team. Especially those responsible for data handling and advertising operations are well-informed about the implications of third-party cookies deprecation and are trained in new privacy-centric practices.
4. Collaborate and build relationships with advertisers. Gather expectations of the audience needed. Create data segments that match your direct sales expectations. Start selling products based on 1st data.
5. Implement consent mechanisms. Ensure that you have a robust Google-certified CMP. Remember that GAM offers integrated privacy and messaging tools that can be used to test, measure consent, opt-out etc., across sites. 
6. Consider re-exploring contextual advertising. Understand the context of your content and offer advertisers opportunities to align their messaging accordingly. Try SDA and Google’s PPS.
7. Adopt privacy-focused technologies. Stay informed about and try privacy-focused technologies like those developed under the Privacy Sandbox initiative, IAB, or various Universal ID providers 
8. Test. Experiment with advertising tech and data strategies to find what works best for your audience and niche. Be agile and willing to adjust your approach based on results. 

We hope you’re ready for the upcoming changes. And if you need more expertise, our AdOps Experts will be happy to help, so don’t hesitate to contact us.