Cookie Deprecation is Coming - Should Advertisers be Worried?

Something nearly everyone in the digital marketing, advertising, e-commerce space, and Foxwell Founders Membership is talking about — should we be worried about cookie deprecation coming, and will this be iOS14.5 round two? Is Google expected to become less cost effective overnight because of the loss of signals? Is this truly Armageddon like some people are claiming or is it being over hyped for engagement bait purposes?

Not sure what's going on? Let’s back up a bit to give some of the backstory.

Google’s Tracking Protection initiative is part of their Privacy Sandbox for the Web. The long-term goal is to eliminate all third-party cookies from Chrome browsers by the end of 2024. On January 4, 2024, Tracking Protection rolled out globally to 1% of Chrome users via desktop and Android as an initial test. While 1% may not sound like much, Gizmodo estimates this is about 30 Million people, with 60% of all internet users on Chrome. Here’s a helpful blog from Jon Loomer on What Chrome’s Elimination of Third-Party Cookies Means for Meta Advertisers -read it if you want to nerd out like us. 🤓

If you want or need a history lesson, to recap, first-party data capture is anything from website registrations (like email pop-ups etc.) and checkouts to lead gen capture to post-purchase surveys and customer service interactions - anything where users enter their info willingly and submit it to you. A good start is just looking across all your customer touch points and seeing where you can capture user data. From a technical perspective, there’s not any major difference between the first-and third-party cookies, as they both contain the same pieces of information and can perform similar functions. The real difference between these two cookie types is how they’re created and used.

Third-party data is the same actual information as first-party data/cookies, but are created on domains OTHER than the one you’re currently on. Whereas first-party data for Brand XYZ would be their own customers who have purchased and their email address and purchase amounts, that same data on another site is third-party. Third-party data is used for cross-site tracking, retargeting, and advertising. Third-party data does not include server-side tracking (aka CAPI on Meta ads) that was all the hype a few years ago to ensure it was set up and tracking properly to improve data tracking.

So what does this mean for e-commerce and its advertisers?

Yes, remarketing will still be possible. 

The phasing out of third party cookies will impact things like display networks, but platforms like Meta and Google also use first-party cookies for their tracking. So for example, if a user clicks a FB/IG ad, and goes to a website, the Pixel will still send data back and can use a 1st party cookie to store and transmit info.  And if that Pixel event includes product data, the platform will be able to connect it to the catalog.

The impact would be felt by external partners who reply on those third-party cookies, but Google will be fine since their cookies are still around. There would be some impact but it should be minor, especially if you have things like serve-side tracking, Enhanced Conversions and other tracking set up for Shopify clients. Keep in mind that Google cookies are not considered “third-party” for most, so Google should be mostly unaffected.

Safari (which is the default browser for ads on iOS devices) has been operating cookiless for years, so we aren’t expecting there to be much of an impact. Technically, Meta ads have an in-app browser for ads (that isn’t Safari completely) that are based on Webkit which is from Apple and has been blocking cookies for a while.

To quote Foxwell Founders member Brett Fish, owner of SkySill Agency… (he said it better than we could ever summarize):

There will definitely be an element of change - platforms like Meta and Google use third-party cookies for signals and info, especially off-site, and that will be degraded by third-party cookies going away. However, Apple blocked third party cookies for 100% of traffic back in 2020, and most brands see almost half of their traffic from Safari (!!!) So that impact has already been felt for a while now.

The biggest impact is likely to be on display networks, because platforms like Google and Meta ALSO use first party cookies, so there will be some signal loss, but not major. Meta is also working on a beta 1st Party Pixel altogether. So as long as you’re using ad platforms platforms (Google, Meta, TikTok, Email/SMS) and aren’t super reliant on display networks, there likely won’t be a major impact.

THAT BEING SAID - I think it’s wise not to ignore it altogether, and to look into some of the strategies in the Epsilon diagram in the article - building out a CDP, beefing up first-party data capture, etc.  Those are considered best practices anyway, and will become even more beneficial with all of the privacy changes on the horizon and beyond.

So there you have it. When e-commerce brands freak out about cookie deprecation, just read them this blog post and rest easy knowing it’s all (hopefully) going to be okay.

The takeaways from all of this information?

• The transition away from third-party cookies represents a significant challenge and opportunity for the digital advertising industry. Advertisers and marketers will need to adapt to new technologies and strategies that respect user privacy while still enabling effective targeting and measurement.

• Enhanced conversions and server-side tracking offer potential pathways for adapting to these changes, but they also require advertisers to navigate complex technical and privacy considerations.

• The increasing importance of data modeling and incrementality highlights a shift towards a more nuanced understanding of advertising effectiveness, moving away from over-reliance on direct tracking metrics towards broader measures of success.

• Overall, the deprecation of third-party cookies is likely to accelerate the digital advertising industry's evolution towards more privacy-focused and user-centric practices.

Need some reassurance on your own? We’re talking about this stuff DAILY (if not hourly) in the Foxwell Founders Membership with so many best-in-the-world experts on topics just like these every. single. day. We’d love to have you!

Quick thank you to Foxwell Founders members, Brett Fish, Duane Brown, Tomasz Pasko, Andrew Lolk, Menachem Ani, and others for their submissions to the Foxwell Founders membership that helped supply information for this blog.