Jun 21, 2022 4:15:00 PM | Biz Models Ultimate Guide of Cookieless eCommerce for Marketers

Learn what are cookies, what are they used for, and what does cookieless targeting mean for consumers.

Over the last two decades, digital marketers have heavily relied on the tracking technologies like third-party cookies and tracking code-snippets to track and monitor surfers' online behavioral patterns as they browse through the websites and to deliver targeted ads based on consumers' actions and probable preferences. Meanwhile, the cookies do give digital marketers a sneaky way to peek into consumers' privacy, even though it helps reach, filter, and retain customers. As the awareness of data protection grows, concerns are raised high. Now the entire eCommerce and IT industry are closely examining the "cookie practices."

Table of contents

  1. What are cookies?
  2. How are cookies used?
  3. What is cookie targeting?
  4. Contextual advertising
  5. First-party cookies
  6. Third-party cookies
  7. Cookieless regulations
  8. What does cookieless targeting mean for consumers?

 

What are cookies?

Cookies are small text files that websites place on your computer. Cookies remember your preferences and some information about your visit. For example, a website might use a cookie to keep you logged in, remember your shopping cart, or remember your preferred language. Cookies make your web browsing experience better by allowing websites to tailor their content to your needs. They also help website owners understand how people use their websites. This information can be used to improve the design of the website and make it more user-friendly.

 

How are cookies used?

Cookies are also used to track users’ behavior. This is called web tracking. Web tracking allows websites to collect data about how users interact with their websites. This information can be used to improve the design of the website and make it more user-friendly.

Some people are concerned about the privacy implications of cookies. Cookies can be used to track users’ behavior and collect data about their preferences. This information can be used to create a profile of the user’s interests. This information can then be used to target the user with ads that are relevant to their interests. Some people believe that this is an invasion of their privacy. They believe that websites should not be able to track their behavior without their consent.

However, cookies also have some benefits. Cookies help websites remember your preferences. This makes your web browsing experience more personalized and enjoyable. Cookies also help website owners understand how people use their websites. This information can be used to improve the design of the website and make it more user-friendly.



What is cookie targeting?

What does Cookieless targeting actually mean? In fact, it refers to a group of audience-identifying and targeting methods where traditional cookies are not applied, or the use of third-party cookies is banned or not allowed by the end-users. 

Cookieless advertising is now gaining popularity as data privacy concerns continue to grow and data legislation regarding the legal use of personally identifiable information (PII) is getting more visible on a global scale. As the digital advertising industry is rapidly evolving, digital marketers are expected to experiment with new and cookieless means to filter and target audiences. Such means are executed by contextual advertising, which can be a highly effective AI-powered form of targeting that doesn’t require cookies.

 

Contextual advertising

Advertisers are able to push their ad placements to the targeted websites with planned content concerning the relevant product or service. For example, if the consumer is browsing through the website displaying new branded sneakers, then he or she might be interested in the activities like sports, fashion, and fitness. Therefore, digital marketers started to presume that ads placements about sports clothes could also be reaching out directly to these groups of target audiences. 

Yes, contextual targeting hasn't been proven to be capable of entirely replacing the traditional cookies yet. It will allow digital advertising firms to determine the preferences of the online user by not tracking any data regarding personal information or data. 

 

First-party cookies

First-party cookies are used to track and monitor the online behavioral patterns of visitors to a website and are created by the host domain or the domain a user is visiting. They are purposely created and used to offer a better user experience and keep a session continuously operating. First-party cookies can remember key behavioral information like usernames, language preferences, and what items have been added to shopping carts.

 

Third-party cookies

Third-party cookies are the backbone of programmatic advertising and are created by domains other than the one a user is visiting. They are mainly used for tracking purposes and online advertising.

 

Cookieless regulations

Since 2021, multiple states across the U.S. have passed very rigorous laws regarding online personal data privacy protections, and major high-tech firms have decided to practice, discontinue, or announce their plans to terminate the support or the uses of third-party cookie tracking and monitoring on online browsers. These changes will profoundly change the advertising strategies of any digital marketer.

The entire digital ads ecosystem is built upon the use of third-party cookies and that is about to get dismantled. More brands are now preparing to grapple with how these impacts may actually influence social media expenses, digital campaigns, and revenue. 

The third-party data has profoundly impacted many brands getting so lazy as they rely more and more on aggregated data providers rather than erasing their own first-party data and also integrating data across online websites, call centers, and in-store channels, or simply among others. The phasing out of third-party cookies may force brands to revolutionize their game plans from a data governance perspective and to be more technical with consumer engagement, user experiences, and building rapport.

 

What does cookieless targeting mean for consumers?

When Apple decided to no longer suspend its support of third-party cookies, it shook the world. Consumers were given back the ultimate control over the personal data that they were not willing to share with any corporations and organizations in terms of their online identities and activities. 

Therefore, companies are legally required to acquire explicit consent for data to be collected and consumers will have a much clearer insight into which behavioral data are targeted by corporations.

One potential drawback to the revoking of the use of cookies is that previous customized web browsing experiences could become less common and more non-relevant ads being shown to the consumers. However, customization will certainly not disappear completely as digital advertisers continue to utilize an hybride of strategies to reach out to target audiences, supported by AI and machine learning, to provide users a personalized and data-safe experience.

What does cookieless targeting mean for advertisers?

Due to the immediate effect of the discontinued use of cookies, most third-party audience data tracking schemes will quickly diminish in size. However, audience key data will still be available and generated as first-party or second-party cookie data. But these data are expected to be completely clean of cookie-based third-party data and be GDPR compliant.

By looking forward, digital advertisers will have to rely more heavily on cookieless strategies and tools to identify, filter, and target audiences so that they can continue to offer a highly customized online experience and still collect data to inform future decision-making for the merchants.

 

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Written By: Luk.Chan

Read articles written by Luk.Chan and learn the essentials about developing eCommerce businesses on Shoplazza.