Digital 101: Cookies
Exploring the world of audience tracking and what to expect from new privacy policies
You’ve determined how you’ll find your audience and developed creative assets for various digital channels. Now how can you identify and track your audience to determine who sees your ad, if they convert and – at the risk of losing them after one exposure –where they go next? Cookies are the digital breadcrumb that make all this possible.
So what is a cookie? A cookie is essentially a text file tied to the user’s device that is passed back to their browser upon loading a website. Here’s how it works:
- You visit a publisher’s site.
- That publisher places a cookie in your browser which follows you offsite to wherever you go next.
- The publisher then serves you an ad from one of their advertisers.
- You click on the ad and go to the advertiser’s site, but don’t convert.
- The advertiser places their own, different cookie in your browser.
- You keep browsing, until the publisher serves you a retargeted ad.
- At that point, you click on the second ad and take a conversion action on site (like a purchase or an email sign up)
Cookies have enabled the publisher and advertiser to track these conversions to attribute them to ads, as well as record the number of times someone has seen an ad. Other cookies may be placed by ad tech vendors across multiple websites, allowing that 3rd party to track and aggregate behavior data that can be sold for advertising, as we discussed in our blog post about targeting.
In the past, users were given no warning, explanation, or opportunity to “consent” to this process. Then last year, Google announced it would phase out 3rd-party cookies on its Chrome browser and, similarly, Apple announced users must give permission for IDFA tagging, which works like cookies but on iOS in-app browsing.
But not all cookies are going away. First-party cookies – which advertisers and publishers collect directly from their customers or site visitors – will stay. They will continue to track on-site behavior including language preferences, what’s in your shopping cart, what pages you visited on the site.
So what is the future of digital advertising in a post-cookie and post-IDFA world? For starters, contextual targeting – which doesn’t bring the same data privacy or tracking concerns – is now more attractive. Programmatic, on the other hand, is up in the air.
Third party audiences built on cookie-based aggregated web behavior will lose tremendous scale or disappear. Programmatic targeting of other list-based audiences will be difficult until a new solution is in place for identity matching – linking customer profiles across devices, publishers, advertisers, and data sources – to be able serve ads to specific users. The top digital data and advertising companies are working together on new privacy-compliant solutions that will solve for both the issues of targeting and cross-channel conversion tracking that were previously facilitated by cookies.
In the meantime, there are immediate steps that our clients and potential clients can take to future-proof themselves.
- Maximize collection of first-party data, but always with customer consent, and provide value in exchange for the data. You’ll start to notice more publishers ramping up on this by requiring users to log in or authenticate before they are able to view content.
- Unify the data across your organization and customer touchpoints to create a holistic customer profile.
R+K’s Maggie Mattheessen, Digital Supervisor, Paid Media, contributed to this post. If you would like to learn more about how Rhea + Kaiser can help prepare your brand for a world with fewer cookies, including reviewing your brand destinations for compliance, contact our Business Development Director email@example.com.
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