Published on: 30 Nov 2023
Reading time: 5 minutes
The limitations of third-party cookies being blocked pose several challenges for digital marketers and advertisers. However, despite the significant role that cookies have been playing in helping brands reach their target audience in marketing campaigns for so long, the phasing out of cookies is also driving the development of new targeting alternatives that can not only help maintain the targeting capabilities that advertisers have but will actually help improve them. Exploring innovative approaches to audience targeting that go beyond third-party cookies opens the door for more effective and privacy-conscious target marketing strategies, paving the way for a dynamic evolution of the digital marketing landscape and target advertising.
Cookies are snippets of data that websites store on a user's web browser to track their activity across the internet. When a user visits a web page, cookies associated with that site are saved to their browser. These cookies can monitor the user's interactions with that site over time, helping personalize their user journey a bit more, every time they visit. Cookies have been a core component of AdTech for years. Initially created as a reliable way for websites to keep track of important user information to improve their browsing experience, cookies are now predominantly used by publishers and advertisers to deliver targeted ads and to connect with their target demographic.
Cookies are primarily of two types:
First-party cookies are owned by the company that owns the website you are visiting and can only be accessed by the company. First-party cookies are generally used to store information like username and password, items in the shopping cart, language preferences, etc. This allows the website to recognize users and optimize their browsing experience.
First-party cookies are privacy-compliant and offer brands a great way to personalize the online experience of their custom audience within a digital environment that they own.
Third-party cookies are placed on websites by third parties that work with the company that owns the site. This can include integrated social platforms, advertising partners, other service partners, etc. Third-party cookies facilitate several aspects of digital marketing, like retargeting and lookalike audience targeting, behavioral profiling of the target customer, identifying custom intent audiences, and much more.
These code snippets play a significant role in many fundamental aspects of contemporary advertising, such as:
Using first-party cookies for audience targeting allows for the delivery of relevant ads to users who may have visited a website earlier as well. But when it comes to retargeting ads for an advertiser’s target demographic outside the owned digital environment, marketers depend on third-party cookies. Third-party cookies also facilitate the creation of lookalike audience targeting models, where the first-party pool of target customers is mirrored on a larger scale using cross-platform profiles of users.
In marketing, the target audience cannot be served the same ad repetitively. Instead of helping increase sales or conversions, it may negatively impact the brand perception of a user. Third-party cookies allow ad-serving platforms to keep track of the number of impressions an ad has gained from a single target customer, preventing the same ad from being displayed to a user more than a specific number of times.
Ad serving platforms provide advertisers with a code for tracking the performance metrics of an ad. When a user interacts with an ad that is being served across the internet, a third-party cookie is placed on their web browser. Thus, the user’s preferences and behavior can be tracked easily when they visit the advertiser’s website.
AdChoices is a solution that allows users to opt out of behavioral targeting that is based on their browser history, offering users more control over the information they share with a website. As ironic as it may appear, opting out of cookie-based audience targeting also requires the use of third-party cookies placed on a user’s web browser.
Depending on the types of target market that an advertiser aims to reach, there are several audience targeting solutions that are completely cookie-less.
Contextual targeting involves serving ads that are relevant to the content of a website. This custom audience targeting strategy, instead of considering the demographics of the user visiting the site, focuses on the website itself and serves ads that act as a value-add for visitors. For example, advertisers can place ads for holiday packages on a travel-related website. Without third-party data, contextual targeting becomes a useful proxy for engaging different types of the target market.
Walk the extra mile in collecting insights about the visitors to your website. Encourage the exchange of personal information for products or services that benefit your consumers. Generate unique and informational content to build trust with your audience, ensure an intuitive and easy-to-use interface for the website, and most importantly, utilize the data you collect to gain a better understanding of your audience.
Avoid overly detailed consumer analysis, as it can be very intrusive. While personalization is important in digital marketing, it is better to identify larger and more loosely defined audience segments that share your brand’s values and intent. Custom audience segments can be created when you build trust around your brand’s products and services.
Adapting and implementing the latest in advertising technology, AI, machine learning, etc., and undergoing digital transformation across functions can help make the transition to a cookie-less future easier. Whether it is retargeting ads, creating buyer personas, or reaching your target audience across online platforms, the right technological tools can help unlock new targeting opportunities.
Showcasing transparency and openness, being accountable for your brand and its products and services and for your online positioning are some of the things you can do to slowly build yourself as a name that people can trust.
Embracing change can be beneficial. The adoption of alternate targeting strategies that do not rely on third-party cookies can not only help brands prepare for the future of digital marketing but will also enable the creation of a thriving, privacy-focused, healthy ecosystem for digital advertising in the coming times.
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