The end of retargeting through cookies: What does the future look like for advertisers?
For years, cookie tracking has been the main tool to help businesses reach potential customers through advertising. However, earlier this year, Google Chrome announced that it will join its competitors Firefox and Safari, to completely block third-party cookies which are not HTTPS secure. Furthermore, it plans to phase out cookies completely by 2022. This is the result of the browser giant’s effort to protect the data of individuals and ultimately, to make the internet safer. But what does this mean for targeting and, specifically, retargeting? Cookies have always been the online advertising industry’s main method to retarget customers. With these changes, many advertisers are scratching their heads wondering what alternatives to implement going forward.
Why are cookies so important to advertisers for retargeting?
The online advertising ecosystem, including publishers and affiliate marketers, rely heavily on retargeting as a means to fuel revenue, as it is mainly based on consumers’ existing interest. In other words, advertisers have an increased chance to make a sale by targeting consumers who have already shown interest.
Cookies make retargeting easy, as it provides a lot of data about visitors, including demographics, interests and browsing behaviour. Advertisers use this data to tailor their ads to focus on audiences who are most likely to buy their products or services. However, with cookies losing their relevance, advertisers have to look for ways to gain this data securely and comply with the latest regulations. But what are the alternatives?
Alternatives to retargeting in 2020 and beyond
Advertisers who want to continue reaching customers online, now have to re-evaluate their data collection strategy. But if not through cookies, how can audiences be retargeted effectively? Let’s look at a few options:
First-party data should be the main priority
For now, first-party cookies aren’t going anywhere. This type of cookies is usually created by a website owner or publisher to see which users return to specific sites and to make sure that the content displayed is tailored and offers the best experiences to users. First-party cookies remember language settings and collect analytics data which measures how users browse around a website. Although it is not as powerful as third-party cookies when it comes to retargeting, first-party cookies can still be used to define audiences and tailor content and ads.
Moving away from Cookies to Persistent Identities (PIDs)
Cookies work on desktops, while a PID is an identifier that tracks users across several devices, including desktops, mobile phones and tablets. These PIDs are created when users log in on one secure platform. The PID then recognises the user on all devices and can produce data for advertisers to use. As more consumers are moving to mobile devices for browsing purposes, this is seen as an effective solution in a cookie-free world.
Even though it is still being developed and experimented with, login platforms are on the rise and are now looking like one of the most promising solutions as an alternative to third-party cookie tracking. These platforms track users with one constant identity (ID) they obtain once they log in with an email and password. This ID will be used to produce certain data, however, there is a bigger focus on user behaviour, and personal details are not included. These IDs are then shared between publishers, and registration and logging in become mandatory. It is evident that this can be problematic, as all publishers and advertisers have to agree to the system and users have to voluntarily opt-in. Therefore, login platforms are still being tested
There are numerous so-called ‘advertiser marketplaces’ on the rise that offer a privacy-first solution to advertisers. These marketplaces consist of technology platforms where publishers can sell their advertising resources and in turn, advertisers can buy it. Most of them claim to make safety a priority and offer advertisers access to data in the most transparent way possible.
Social media giants, including Facebook, Twitter and Instagram have all entered the remarketing domain. Specifically, Facebook is a viable targeting solution, as it offers a pixel tool through its Facebook Customer Audiences services that can be added to a website. This then allows the website owners or publisher to build a custom audience. It is also useful as it enables the owner or publisher to build lists for retargeting specific audiences based on the pages they visit on a website.
The IAB Technology Laboratory’s (IAB Tech Lab) Project Rearc is still being developed as it uses special new technology. However, it is predicted that this project will be a revolutionary solution for retargeting for advertisers as it will follow the California Consumer Privacy Act (CCPA) and the General Data Protection Regulation (GDPR) rules. Project Rearc involves users to use an encrypted and hashed email or phone number to create a unique ID. This ID is passed through from the publisher to Supply-side Platform (SSP) to Demand-side Signal Processing (DSP) to marketer – the normal programmatic chain – to produce data while protecting certain personal details.
Going forward: A simpler way of working with data
It is predicted that in the future, the online advertising industry will be looking at streamlining the types of data they obtain and use. This is known as “data minimisation” meaning that advertisers will only get access to data they can use in their targeted advertising campaigns, and personal data is left out. This is in line with the GDPR’s efforts to protect online users.
The cookie is finally being worked out of the digital advertising world. While it is making targeting and retargeting more complex, for now, it is an exciting time for advertisers to try new tools and processes, as the online advertising community is increasingly experimenting with innovative new ways to reach consumers.
A waterproof solution may not exist quite yet, but it is evident: While the third-party cookie may be no more, retargeting is here to stay.