The (Third-Party) Cookie Crumbles
Posted: March 5, 2021
What Google’s Announcement This Week Means for Advertisers and Agencies
The era of third-party cookies has been in decline for some time. Technology leaders such as Apple and Google are serious in their drive toward a more “privacy-first” web experience, which VisionPoint fully supports. In Google’s announcement this week, it shared the perspective that they envision a (near) future where “there is no need to sacrifice relevant advertising and monetization in order to deliver a private and secure experience.” Google receives a significant portion of its revenue via ads, so while its drive for privacy-first is real, its intent to continue selling relevant ads is equally real.
What does this most recent announcement mean in the near term?
As the industry shifts further away from third-party cookies, the ability to hyper-target right-fit customers and students may be temporarily impacted. However, it is important to note that website retargeting – an important component for our clients’ media campaigns – is considered a first-party cookie, so impacts to this tactic are minimal at this time.
The same is true for Responsive Display advertising (from Google), which remains a fully viable channel for the foreseeable future. That said, channels like Programmatic Display – which utilizes third-party cookies – could experience some impacts. But changes are not fully expected until 2022. Currently, the DSP we use for Programmatic Display uses a blend of third-party cookies and first-party IDs. Throughout 2021, we expect this offering will transition away from the use of some third-party IDs to a mix of first-party IDs, household IDs, and what is described as aggregate-level targeting. One main component within aggregate-level targeting is Google’s own Federated Learning of Cohorts (FLoC) technology.
What the FLoC?
FLoC is Google’s own approach to circumventing third-party cookies. It is touting this as an “effective replacement signal for third-party cookies.” Google’s tests have gone well (hence yesterday’s announcement) and this technology is coming to Chrome and directly to advertisers and agencies (including VisionPoint) in Q2: from Google’s previous announcements: “Chrome intends to make FLoC-based cohorts available for public testing through origin trials within its release this month, and we expect to begin testing FLoC-based cohorts within advertisers in Google Ads in Q2.“
So, what’s the bottom line?
A healthy and diverse digital media mix that includes website retargeting from your site and Responsive Display channels using first-party cookies is a solid approach and should remain unaffected. With channels like Programmatic Display, Major DSPs have been planning for this transition for a long time and are now accelerating their efforts to adapt to the new reality in 2022. Talk with your agency or platform provider ASAP and ask if its plans are in place to move away from third-party cookies this year.
To our clients – VisionPoint remains committed to providing clarity and action with you now and as further best practices are determined. We’ll continue to keep you informed, and please reach out to your Client Services team with any immediate questions.
Not a VisionPoint client but would like to discuss this topic with us further? Reach out today to set up a free call with our team. We’re always looking to chat with our higher ed peers.