Cookieless Advertising Is Here And Will Not Go Away

Mapendo Team
May 26, 2022
Cookieless Advertising Is Here And Will Not Go Away

Cookieless Advertising is something that used to belong to the past. Since tracking became possible, advertisers and brands, as we know, never looked back. Following a user behaviour across multiple website gave marketers the chance to really know what someone was doing; perception and bias stopped working, in lieu of them came data. An enormous amount.

But this is somehow coming to an end, as personal data about users won’t be so easy to reach for advertisers in what could be called the cookieless age.

First: how and why did we get here?

A little over a year ago, Safari announced that it was going to start blocking third party cookies. Then apple kept on going and announced ATT — App Transparency Tracking — , which was bound to come with IOS 14.5 and it would allow the user to decide whether to be tracked or not. Also, Google announced that by 2022 third party cookies will be blocked on Chrome, the most used browser in the world by far, with a market share of 64%.

If you want to dig deeper into what IOS 14.5 means for the industry, you can read our article in here

The upcoming end — maybe is just temporary, maybe not — of the cookies, especially the third party ones, means a lot for brands and advertisers; marketers keep repeating themselves that creating content that resonate with the audience is crucial — it is — and yet no one can give up advertising investments — by the way they are increasing

We would be lying if we said that we know what will happen. We know that big changes are ahead and we think we can rely, for now, on what works in the cookieless age.

Let’s quickly recap what first party and third party cookies are.

What is the difference between first party and third party cookies?

First party cookies are collected by the domain we are visiting and are mainly used to analyze user information in order to help the website we are visiting providing an ad that is coherent. First party cookies don’t track the activity of a user on other websites. They are collected by the domain and used to segment the audience and improve the user experience.

Third party cookies involve the presence of ad vendors or DSPs — digital signal processor — that collect data about the user behaviour on different domains, allowing advertisers to track, analyze and cluster users across a multitude of domains. Third-party cookies can also be connected with other key data like the IP address that communicates the user location, the device she is using and more.

John Schnobrich on Unsplash

What is cookieless targeting?

Cookieless targeting means targeting audiences without the help of cookies because they are blocked by the user or don’t work or for any other reasons. In this day and age — up until now — digital advertising was mainly focused on cookie tracking and was leveraging technology to reach micro-audiences that advertisers knew were most likely to buy a product or to convert in some other way.

We like to cover these topics also in our newsletter: you can subscribe here

In the last few weeks, cookieless advertising has gained in popularity as more privacy oriented regulations are issued by the the few companies that dominate the technology market, such as Mozilla, Apple or Google.

As the advertising industry continues to evolve, we can expect marketers to use new, cookieless ways to target audiences.

So, is it possible to target ads without cookies?

One potential downside to the loss of cookies is that personalization of a website’s experience could become less common and result in more irrelevant ads being shown, therefore could provoke a waste of money.

“Half the money I spend on advertising is wasted; the trouble is, i don’t know which half.”

John Wanamaker hyper famous sentence highlights one of the biggest problems that marketers had to face since the dawn of time: measuring. You want your advertising budget to be spent in the best possible way. You want to see and know how your campaigns perform, so that you can stop wasting money on non performing ones.

Cookies allowed for more personalisation. Networks knew everything about the user and knew how to target her in the best possible way to convert. You could send an almost unique message to every user. You could also see how this performed and whether it made sense to keep investing on this or that or not.

Clearly, In the last ten years, since “cookie” was invented, the entire digital advertising industry has been heavily based on tracking and cookies. Even more, it has probably been based almost entirely on them.

So, Targeting without cookies means that you do a trade off between giving the user more privacy and sending less personalised messages.

In order to do so, you can use a couple of cookieless targeting “techniques”. One is based on prediction, the other on context.

Does contextual targeting work? Yes, but…

Cookieless contextual targeting can be a substitute for cookie-based targeting, where the website content is used to target ads and not the user’s cookie ID.

An example of contextual advertising, as seen in SearchEngineland

The screenshot here is an example of what contextual looks like. It is like the old ads in the press, where, for example, you would advertise your brand new car or car-related-product on a vertical publication about cars. In the old days, you could assume that people interested in reading a magazine about something were also willing to buy that something.

Contextual targeting has evolved, obviously.

Nowadays the ad placing process is made digitally via different softwares that analyze the context of a website and decide whether an ad is coherent or not with that domain. These algorithms are able to recognize what makes sense and what doesn’t thanks to a content taxonomy technology.

So, as the “cookie-less era” is coming upon us, contextual advertising solutions are being tipped as one solution to help plug the targeting gap for digital marketers. They are extremely privacy friendly but can pose some grand challenges, especially when it comes to precision and measurement.

Even though content taxonomy algorithms can be extremely powerful, they are not as precise as cookies. They can place an ad about something in a website that resonates with that something. This doesn’t mean that a user visiting a sport magazine has any intention of buying.

Furthermore, is hard to track the performance of a contextual ad. You can measure impressions, some sort of clicks, time a person sees a click but not that much more.

Machine Learning and prediction based advertising

As we said, the loss of cookies leads to a minor personalization of a website’s experience, something that will surely result in more irrelevant ads being shown.

However, customisation will certainly not go away completely as advertisers continue to utilise both new and old tactics, backed by AI and machine learning, to provide users a personalised and data-safe experience.

Machine learning models are based on prediction and data gathering that help understand trends, consumer behaviours and identify patterns. A.I. powered advertising has always been privacy friendly, as it works on bigger volumes and not on the single user.

In this day and age, Artificial Intelligence and contextual targeting seem to be the main solutions to a “problem” that is just starting to arise. The fact is, privacy is not going to go away. Users are asking for it more and more and companies need and want to give them the opportunity to choose between being tracked or not.

So, well, cookieless targeting will be the next big thing.