What’s happening with cookies?

What’s happening with cookies?

In 2019, Google initially announced third party cookies would be deprecated in the interest of protecting user privacy. The deadline was kicked back multiple times for various reasons. Google is now slated to phase out support for the third party cookie in late 2023.

But first, what’s a third party cookie? What’s it used for and why should publishers care?

Third party cookies are cross-domain cookies often set by advertisers, agencies, and DSPs to track users across different sites.  This is in opposite to first party cookies, or those used by the publisher themselves and are unaffected by the change

The assumption as presented in media repeatedly, is that Google eliminating third party cookies would obliterate digital advertising, sending the industry back to the stone age.  Although some publishers should expect some hiccups in the status quo of operations as with every major industry change, these sky-is-falling cookiepocalypse predictions are doomsday cult prophecies at best, and clickbait at worst.

Why?

For starters, cookiepocalypse already arrived in 2020. Safari, Firefox, and Edge started blocking third party cookies by default years ago. The revenue on those platforms didn’t go to zero. For sites with high traffic from users with those browsers, they already took those revenue hits. Many publishers have recovered from any hiccups then, and even gone further, with session RPMs in Safari, Firefox, and Edge often exceeding Chrome at historically high ratios, despite having no third party cookies and no replacement.  Agencies and advertisers and DSPs on the buy-side have already been handling the deprecation of third party cookies for over 2 years. In short, cookiepocalypse already came, and the victors are already claiming the spoils.

Second, Google’s plan is not to block all advertising tracking across the internet. They’re only talking about Chrome, and they’re not blocking advertising tracking either — it’s just very specific parts of the third party cookie model that will be blocked.  Unlike Safari, Firefox, and Edge, which blocked third party cookies with no replacement, Google has invested heavily in figuring out a privacy-first replacement model.  Google is switching to a privacy sandbox where Google has run and tested over a dozen different models on what information is accessible and how.  Their prior leading model was FLOC, and in testing, advertisers saw minimal changes in advertising performance while publishers saw minimal change in advertising revenues. Now Google’s current leading model is FLEDGE, which fixes privacy issues with FLOC, while explicitly allowing advertisers to generate advertising interest segments for users, just with anonymized aggregation rather than individual user tracking. The exact details of what will launch are still not finalized for the late 2023 deprecation of third party cookies, but the point is the buy-side has been handling cookieless advertising for over 2 years now, and this replacement is already functionally very near advertising performance of third party cookies. In other words, advertising is not being eliminated on Chrome — third party tracking cookies are simply being replaced by anonymous advertising segmentation.

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And finally, for all but the largest publishers on the internet, there are very few things the average publisher needs to actually do to prepare.

  • Publishers running Google AdSense or AdExchange exclusively are already covered by Google’s privacy sandbox management.
  • Publishers running direct sales standard and sponsorship campaigns weren’t traditionally using third party cookies in the first place.
  • Publishers running PMPs, header bidding, and managed demand will not only have the benefit of FLEDGE audience segmentation or its successor, but all of the rest of the workarounds the industry has been doing since 2020, including first party identification protocols and other similar segmentation technology.

That’s not to say there won’t be any issues — as with all industry-wide tech changes, there will be hiccups.  The point is that for most publishers, this will be minimal or even unnoticeable.  With that said, publishers over 1 billion monthly impressions should consider strategizing and hedging their options with ad tech engineering experts.  We’ve already paid our publishers more than $100 million, so contact us today and let us show you how we can help!

Kean Graham

CEO and Founder at MonetizeMore

Kean has been a pioneer in the AdTech world since 2010 who believes in the supremacy of direct publisher deals, programmatic advertising, and building ad technology as keys to scaling ad revenue. Here, he provides publisher resources and guides covering areas like website monetization, AdSense optimization, Google Ad Manager, Ad Exchanges, and much more.

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