Cookies were invented by a Netscape employee to identify repeat visitors to websites. Currently, this technology is used by all online residents to make surfing the web more comfortable. And in the eyes of advertisers and marketers, this is crucial data that allows them to test campaigns and identify the most relevant audience.
HTTP cookies are text files that record data about the user's visits to websites. Cookies also record information about authorizations and the actions taken on websites. For example, if a user puts an item in their cart and closes the page, the Cookies will “remember” it and when the user reopens the page, the item will still be in their cart. These files also record a website’s unique settings for each user, authorization and action.
Additionally, Cookie files can record:
By analyzing this data, ad platforms receive anonymized data about users which enables them to put together an approximate portrait of each one. Thanks to this technology, it became possible to configure ad campaigns according to a variety of settings and interests. The user always has the opportunity to turn off Cookie files in any browser or delete them.
Still, in their general pursuit of preserving user confidentiality and storing their data large IT companies are refusing to record Cookie files. In March 2020, Apple announced it was blocking cookies in the Safari browser that tracked users. And on March 3, 2021, Google announced its refusal to use third-party cookies in its services and revealed its own developments meant to replace Cookies.
Corporations attribute their decisions to concern for users and the privacy of their data. But many participants of online marketing believe this is being done to divide the ad market. Google Chrome is the most popular browser in the world, its share in 2021 was 64.48%. In addition, Google has Google Ads, the world’s largest ad platform, and without user data, it will be impossible to display targeted ads. This is why Google offers to use its own tools that will collect more anonymized data to replace Cookies.
Whether users and market participants will actually benefit from this move is a matter open for discussion, since the data will still be collected in Google’s ecosystem, but the absence of Cookies will make it harder for other services to display relevant ads since Cookie files are the core of their strategy.
For now, it’s looking like a big corporation wanting to use its tools, essentially forcing all other market participants to either also start using them or to stop collecting user data that is collected by Google services and Android devices altogether.
Google plans to use the following methods to collect user data:
Such data collection methods are already being tested by Google and its partners from Privacy Sandbox. It is a testing ground for working with interest-based data. Unlike Cookies, this data won’t be stored and transferred to websites and third-party services, remaining on the user’s device instead.
FLoC — Federated Learning of Cohorts will analyze the data of interest groups. This way, according to Google’s plan, data won’t be gathered on each user individually, but rather on similar groups of users. The corporation claims that during testing they managed to obtain more effective targeting results, and go so far as to promise at least a conversion rate of 95% for every dollar spent.
So far, other market participants and browser designers aren’t exactly jumping with joy in regards to Google’s initiatives and have not themselves introduced such algorithms, since such an approach gives the corporation a monopoly on data collection using these technologies.
Nevertheless, Google has published a road map on cookie opt-out and is moving forward in this direction:
Despite the fact that in June 2021, Google postponed the introduction of these technologies and declared it would assist publishers in adapting to the coming changes, the ad market’s participants should already start preparing to operate without cookies. Using currently existing tools, the following data collection methods are available:
At this stage, it is difficult to predict what online marketing will look like in 2023. Perhaps, Google will design a more effective tool for collecting and using data and increase the conversion rate on its advertising platforms, as promised. But there’s still a rather pressing matter: what should the other participants of the online marketing market do? Should they develop and implement their own technologies or just accept the ones Google is rolling out? In any case, advertisers and marketers should start collecting available data during these two years and introduce new developments in the field of online advertising.