Don’t write them off just yet: third-party cookies get a reprieve in 2024

Advertising industry on tenterhooks

It all started with just one percent of Google Chrome users in January 2024 – their browsers already run without third-party cookies. This drastic step seemed like a death knell for this technology, which had proved successful for advertisers, heralding the arrival of a cookieless future. In parts of the industry, the upheaval stirred up a real spirit of optimism, as reported by Eric Hall, Chairman of the Programmatic Advertising Focus Group in the German Digital Economy Association (Bundesverband Digitale Wirtschaft, BVDW):

“The digital economy has always been synonymous with the power of innovation, keeping ahead of the curve, and a solutions-oriented approach. Third-party cookies have been a constant element in the success of the digital ecosystem. Nevertheless, January 4, 2024—’Cookie Depreciation Day’—marks a new beginning and an opportunity to realign the digital advertising industry in Germany.

At the BVDW, we spotted the challenges on the horizon very early on. Valuable preparatory work was carried out at an early stage across almost all committees and in the expert labs set up specially for this purpose. We have taken the market’s oft-repeated maxim of ‘test and learn’ on board and have engaged in intensive discussions. The resulting papers form a basis and guide for the new era in the digital ecosystem.”

Then, in late April, Google announced that it would no longer be able to implement the final phase-out of third-party cookies in 2024. The differences between the parties involved—users, advertisers, and authorities—are still too great. The dawn of the post-cookie era has been postponed once again.

Proven solutions instead of rushing down blind alleys

What will the world look like after third-party cookies have gone? Many advertisers and marketing stakeholders continue to ask themselves this question. And some stakeholders are still lagging behind in their preparations—a survey by Teads in May 2024 found that only 32 percent of publishers are prepared for the cookie phase-out. The definitive answer to one of the key questions about the future of digital advertising apparently remains elusive.

However, the digital advertising industry is not completely unprepared for the technological change. Eric Hall points out that new solutions could be just as successful: “We have quickly learned that there are alternative ways of addressing the advertising target group, and that the technological achievements of two decades of product development can also be taken further without third-party cookies. And that there is more than just one option, and that we can make use of a variety of signals, identifiers, and data. Interoperability has helped many solutions break through.”

According to Eric Hall, the industry has made great strides toward a future without third-party cookies, especially in 2024:

DMEXCO asked, and Google answered

Systems have already been tested and we have an innovative digital industry, so what exactly is still holding up the cookie phase-out? Lidia Schneck from Google’s Privacy & Chrome Partnerships team answered this question for us. She is responsible for the Privacy Sandbox APIs for Chrome and Android in Northern Europe.

Google has been working closely with the UK Competition and Markets Authority (CMA) and the UK Information Commissioner’s Office (ICO). What results or measures have emerged from this in recent months, and can we really expect third-party cookies to be abolished in early 2025?

Lidia Schneck: “Our vision for the Privacy Sandbox is to ensure a sustainable advertising ecosystem for the open web with strong user privacy protection. The APIs allow companies to select and measure advertising without identifying or tracking individual users via websites and without relying on third-party cookies. We always expected that this change would involve having to reconcile different points of view. To achieve this, we have worked closely with the CMA and the ICO, as well as industry stakeholders.

In September 2023, we reached an important milestone and made the Privacy Sandbox relevance and measurement APIs openly available online. This means that advertisers and developers can scale the use of these new technologies in their products and services, as they are now available to the majority of Chrome users.

We will continue to liaise closely with the CMA and the ICO and hope to complete this process before the end of the year. If we can reach an agreement, we want to start abolishing third-party cookies at the beginning of next year. Updates on this can be found at privacysandbox.com.

As for the future, we expect the APIs to evolve over time through usage and ongoing feedback from the ecosystem. We will always strive to combine data protection and utility. We will continue to work with the CMA and ICO, as well as other data protection and competition authorities around the world, to achieve an outcome that works for users and the ecosystem as a whole.”

What advice do you have for marketers to prepare for the post-third-party cookie world?

Lidia Schneck: “Our message is very clear: be prepared, analyze your dependencies on third-party cookies, and make plans for how to tackle these specific use cases. Take advantage of the Privacy Sandbox and other privacy-friendly tools. We have created a series of guides for marketers, publishers, and ad tech providers that we hope will be useful for everyone involved.

• In general, we encourage everyone to express their interest to their ad tech providers, who may be looking for test participants and early adopters. You can also express your interest in testing via the public (GitHub) tester pages for Topics, Protected Audience, and Attribution Reporting.
• People who rely on third-party cookie data for the functionality of their website can read our guide to preparing for the end of third-party cookies to find out if CHIPS or related website sets can meet their needs.
• Other third-party providers that you work with may rely on third-party cookies for website functionality. In that case, we recommend contacting these providers to find out their plans for eliminating third-party cookies.

The Privacy Sandbox APIs provide building blocks to help companies achieve their business goals while protecting people’s privacy. It is important to note that they are not intended as a direct replacement for third-party cookies or cross-site identifiers. It will not be possible to improve user privacy protection to any significant degree while operating on the basis that all of today’s marketing methods should simply be copied and retained. Instead, work needs to be done to adapt existing approaches and, if necessary, develop new ones with business objectives in mind. What we are dealing with here is a fundamental change that requires investment, work, and, above all, close cooperation. In our view, this change is necessary and feasible.”

What are the current challenges for Google?

Lidia Schneck: “The success of the Privacy Sandbox depends largely on the collective efforts of the industry as a whole. More specifically, this means that hundreds of experts and developers exchange ideas and feedback on the API design in various forums and discussion groups. After removing third-party cookies for one percent of Chrome users last January to enable ad tech testing, we’ve seen an increase in feedback from across the ecosystem as more stakeholders have engaged in this process. We have also had feedback from the regulatory authorities. Reconciling all of this is a challenge for us too. But we believe it is precisely this dialog and cooperation that is crucial to creating new standards for data protection on the Internet.”

Waving goodbye to third-party cookies: Heading into a cookieless future together

Third-party cookies have been the backbone of the digital advertising industry for years. The question now is how to find alternative solutions. Numerous stakeholders are currently working on this in unison—and this collective effort shows no sign of stopping any time soon. In order for Google to meet its target deadline for the switchover in early 2025, everyone who still wants in on the advertising space action after the cookie phase-out will have to do their bit. The work of the BVDW can provide a solution-oriented blueprint in this regard.