5 Substitutes for 3rd-Party Cookies
In the near future, advertisers and publishers will face a significant challenge in maintaining effective user identification methods. As privacy concerns continue to rise, traditional tracking tools used to gather information on users' online behavior are becoming increasingly limited.
For years, tracking cookies have played a key role in monitoring user activity across websites, allowing brands to deliver personalized ads and content. However, changes in technology and stricter privacy regulations are making these methods less viable. The shift away from these tools will likely force the industry to find new ways to identify and reach users while balancing the need for privacy.
As companies like Apple and Google update their policies around user data, the ability to track individuals across multiple platforms and devices will become more restricted. This will push the advertising sector to explore alternatives for user engagement that don’t rely on invasive tracking, all while adhering to emerging privacy standards.
AdTech Alternatives to Cookies
With the end of third-party cookies on the horizon, adtech providers have already begun offering various alternatives to help advertisers and publishers continue to identify users and deliver personalized ads. These solutions can be categorized into several key approaches:
Universal Identifiers
To begin with, these IDs serve as a shared identifier that can be used across multiple platforms. They are designed to function similarly to third-party cookies but rely on hashed, privacy-compliant data, such as email addresses or phone numbers, to track users. The goal is to create a system that works across channels and platforms, providing more comprehensive user identification than traditional cookies, which are limited to web usage.
The trouble with universal ID comes with their scalability. They require cooperation from multiple publishers, and as a result, the user base and inventory available may be fragmented.
Data Pools and Clean Rooms
The secure environments where first-party data from brands and publishers can be stored and analyzed without compromising privacy. Advertisers can use these platforms to gain insights into audience behavior and target users based on data shared between parties, all while adhering to privacy laws. This solution avoids the need for third-party cookies by enabling direct collaboration between brands and publishers.
The main drawback of this solution is that a reliable intermediary that would ensure compliance with privacy regulations. Plus, similarly to the previous approach, it does not provide comprehensive scaling.
Fingerprinting
Unlike traditional cookies, this method relies solely on the unique characteristics of a user’s device, browser, and system to track activity. Instead of storing data on the user's device, it analyzes features such as the device's IP address, the plugins installed on the browser, screen resolution, and time zone. These traits remain largely consistent across different websites, making it easier to track users as they move across the internet.
This method is more difficult for users to detect or avoid compared to cookies, as no data is stored on their device. However, a key drawback is that users have no option to opt-out of fingerprinting, which raises significant privacy concerns. This lack of control over tracking practices goes against privacy standards many in the industry are working to uphold. In response, most major browsers have indicated that they plan to restrict or limit fingerprinting capabilities soon.
User Graphs
They combine multiple identifiers, both personal and non-personal, to create an individualistic view of users across multiple platforms. Linking these identifiers allows advertisers to track the user’s actions and engage in different environments in a more targeted manner of advertising.
Maintaining such graphs could be resource-consuming, especially when users’ privacy is maintained. To avoid potential privacy violations, brands and publishers must partner with trusted vendors with the necessary infrastructure to handle this data securely.
Contextual Targeting
An advertising method that focuses on placing ads based on the content of a specific webpage rather than relying on user behavior or third-party cookies. For example, ads for camping gear might be placed on webpages about outdoor activities, hiking trails, or camping tips. Instead of tracking users, it matches ads to the page’s themes or keywords.
The drawback of this method is that it does not account for the specific demographics of a user's behavior. Unlike other methods, it aims at the page's content while making it less personalised.
Summary
As privacy regulations evolve and the user journey becomes more fragmented, advertisers and publishers must rethink their data collection strategies. While there is no single, unified alternative to cookies yet, one thing is certain: First-party data will play a central role.
Advertisers need to identify the key channels and platforms that drive user acquisition and retention, selecting the appropriate user ID solutions based on these platforms. Additionally, they should consider their target regions, as data privacy laws and available solutions can vary by country. To collect more data directly from users, advertisers could encourage customers to share their information through incentives like loyalty programs or personalized discounts.
Publishers, on the other hand, must focus on enhancing their data collection strategies. To motivate users to provide personal details like email or phone numbers, restricting access to exclusive content can help show the value of sharing this information. Ultimately, the future will rely on building stronger, more transparent relationships with users through direct, first-party data.