With both Apple and Mozilla having already banned third-party cookies in their browsers, and Google planning to follow suit in 2023, now is the time for publishers and advertisers to work together towards a cookieless future, says Adform’s Philip Acton.
We are seeing increasing evidence that first-party IDs are capable of replacing third-party cookies and approximately 80% of brands are keen to start trialling cookieless alternatives sooner rather than later, despite Google’s delay.
In fact, Adform research has found adoption and results are building. Not only are 93% of UK publishers already passing first-party IDs in their bidstream, but during a programme led by Adform, called FIRST-PARTY NOW, UK advertisers utilising these first-party IDs saw much better outcomes in cookieless environments. In Denmark, another test market, media spending on first-party ID impressions actually overtook third-party cookie impressions for the first time across June and July.
Although this data demonstrates that we’re making positive steps, many global brands are still simply not doing enough to prepare for life after third-party cookies, or just not doing anything at all. While this is largely due to a lack of knowledge around how they can use first-party IDs, and mixed messages from their agencies on how best to proceed, it’s clear brands must catch up with publishers and future-proof their supply chains. But to do this, they need to answer two questions: What is the alternative? And how can they start to adjust their strategies?
A viable solution
The only fully scalable alternative to third-party cookies is first-party cookies stored on the server. They can be shared with ad tech vendors and are often stitched together either via clicks or by using machine learning and data modelling. Brands can combine this probabilistic approach with their existing deterministic data to map the availability of relevant audiences.
Apart from removing the need to store third-party cookies in the browser, a first-party ecosystem also helps to build direct relationships with more transparency. Impressions are fully traceable and accountable, so dramatically reduce fraud and hidden fees.
Another benefit is that persistent first-party IDs usually last months or even years, whereas the lifespan of a third-party cookie is only a week. This enables marketers to gain a longer-term view of customer lifetime cycles.
Adform’s FIRST-PARTY NOW programme provided valuable case studies with some of the world’s largest brands, such as Vodafone, Mercedes and American Express, which prove that the use of first-party IDs on Safari and Firefox significantly increases CTRs and conversion rates and drives much lower CPAs than before. The average improvement is 50% lower CPAs and 2-3 times higher CTRs, showing the immediate gains that brands can make in cookieless environments.
Test now, thrive now
Most publishers have already made first-party IDs available, so it’s both possible and important for brands to act now. They need to ensure that their ecosystem supports a range of IDs including first-party cookies and log-in IDs. The benefits associated with targeting, tracking and optimisation will be lost if an alternative solution isn’t implemented and perfected in due time. In many markets, cookie-free browsers already account for nearly half of the traffic, so there is also a huge opportunity for brands to improve their advertising results right now. This is not just about futureproofing for when Chrome also bans third-party cookies in 2023.
Acting early and adapting existing technology and workflows will allow brands to seamlessly transition to the new technology, and future-proof their supply chain. This includes adding new first-party tagging and resetting legacy metrics such as frequency capping or lookback windows.
By utilising the right technology such as buying platforms, brands can test more data sets and audiences, at a much more granular level. It may take some time for all publishers to make their first-party audience data available, but until then, deal IDs are a good alternative.
However, there will be differences between verticals. Some brands are fortunate enough to be mainly interested in audiences that can be more easily sourced and that many large publishers can build based on first-party IDs. Other brands in varying sectors will have a greater dependency on audience data sets that can only be created by aggregating many cross-domain data points and extended through lookalike methods. Mapping availability of relevant audiences is going to call for experimentation, as well as media agency advice.
Transitioning away from third-party cookies is a challenge all brands will face in the near future, but by utilising first-party IDs, a cookieless future doesn’t have to be intimidating. And by making the change sooner rather than later, brands will be able to improve conversion and click-through rates on all browsers immediately.