Google Chrome- 3rd Party Cookies Phase out- Easy explanation- By Sarang Kinjavdekar

Last week , Google has announced that by 2022 it will completely phase out 3rd party cookies. I have seen lots of content written about it but none of the articles have explained some o the basic stuff like- why, what, how etc. Finally, I will talk about the impact of the complete roll out on the Digital ecosystem. This article is aimed to explain things in Plain English.

Why the 3rd Party cookies Phase out is happening?

As per Google

Our goal for this open source initiative is to make the web more private and secure for users, while also supporting publishers. Users are demanding greater privacy--including transparency, choice and control over how their data is used--and it’s clear the web ecosystem needs to evolve to meet these increasing demands. Some browsers have reacted to these concerns by blocking third-party cookies, but we believe this has unintended consequences that can negatively impact both users and the web ecosystem. By undermining the business model of many ad-supported websites, blunt approaches to cookies encourage the use of opaque techniques such as fingerprinting (an invasive workaround to replace cookies), which can actually reduce user privacy and control. We believe that we as a community can, and must, do better.

How the tracking will happen ?

By the end of this year, the Google Chrome team will begin trials that allow for click-based conversion measurement without third-party cookies. will be tracked within the browser, not a third-party cookie, according to a Google spokesperson. When an advertiser needs to track a conversion, they’ll call an API  that will send the conversion value from the browser. Individual user data would not be passed back.

Why Chrome is so important for Advertisers?

First, lets us see why Chrome Browser is so Important

Chrome is the leading Browser and hold the maximum market share.

Safari and Firefox have already blocked the 3rd party cookies. One reason, why Google is not immediately phasing this out is- unlike Safari and Firefox, Google has a huge advertising business which create Billions of Dollars in revenue for Google and also is supporting the whole ecosystem - Advertisers, Publishers and Users. So wiping the 3rd cookie immediately, seems like a risky proposition.


Before we move further, lets first understand what exactly is the cookie and the differene between different types of cookies

3rd Party Cookies Vs. 1st Party Cookies-Difference?

Wikipedia says An HTTP cookie (also called web cookie, Internet cookie, browser cookie, or simply cookie) is a small piece of data sent from a website and stored on the user's computer by the user's web browser while the user is browsing. Cookies were designed to be a reliable mechanism for websites to remember stateful information (such as items added in the shopping cart in an online store) or to record the user's browsing activity (including clicking particular buttons, logging in, or recording which pages were visited in the past). They can also be used to remember arbitrary pieces of information that the user previously entered into form fields such as names, addresses, passwords, and credit-card numbers.

1st Party Cookies- First party coookies are stored in the Domain you are visiting directly. Example- Amazon. They allow website owners to collect analytics data, remember language settings, and perform other useful functions that help provide a good user experience.These are originated from the primary domain visited by the user, hence becoming first-party cookies.


3rd Party Cookies- Third-party cookies are created by domains other than the one you are visiting directly, hence the name third-party. They are used for cross-site tracking, retargeting and ad-serving.

Ex: Lets say you visit a news site www.nytimes.com


What happens now- A first party Cookie is created by www.nytimes.com and at the same time one third-party cookie is also created by the Advertiser who has bought inventory on www.nytimes.com. , [say,  ad.doubleclick.net ]. The reason for a third-party cookie is because the URL (ad.doubleclick.net) doesn’t match the domain (www.nytimes.com). The cookie is left by a third-party advertising provider, hence the name third-party cookie.

I saw a very good explanation and difference here , below is the pictorial to tell the difference

Ok, so now you might be wondering, are there 2nd Party Cookies as well? Yes, you guessed it right, we also have second party cookies. Second-party cookies are cookies that are transferred from one company (the one that created first-party cookies) to another company via some sort of data partnership. For example, an airline could sell its first-party cookies (and other first-party data such as names, email addresses, etc.) to a trusted hotel chain to use for ad targeting, which would mean the cookies become classed as second-party.




How will it affect Advertisers and the ecosystem

• Everything from Targeting to Measurement will be affected
• Chrome will support messaging/targeting a cohort of users, but 1:1 messaging and targeting will be out Question.
• Programatic media buying and usage of 3rd party data will be huge problem
• Cross device/platforms conversions looks nearly impossible after the complete roll out
• Vendors who depends a lot on 3rd party data will be severely affected
• Brands might move their budget to Social and Paid
• User will have more Privacy and less intruding advertisements will be served.
• Retargeting will also be affected, particularly Brands with heavy reliance on Retargeting
• Google;s own property like Youtube and Google.com will not be affected as they use the first party data. Google Display Network, for example, relies on third-party cookies to serve ads based on a person’s browsing behavior. For those ads to continue running, this Google product would need to use the Privacy Sandbox API.
• Data Management Platforms will also be severely affected 
• Content creation, syndication etc will be preferred including focusing more on Social Media strategy
• Audience targeting strategies will change in future after 2022 and Brands should also start planning in advance
• Attribution will also change as there will be no 3rd party cookies.
• View through attribution will completely be eliminated- so the brands who factor in View through, should now focus completely on Click through Conversions
• Browser targeting-  it’s going to be a challenge to targeting within Chrome.
• Outside ad tech providers would lose access to data they gathered through third-party cookies when they get phased out. 
• Chrome’s Privacy Sandbox is open, and any ad tech company with a third-party cookie offering would be able to call the API.
• These changes will affect Google’s business buying ads across the open web, often known as its DoubleClick business
•  Google’s partners – including publishers using Google Ad Manager to sell their ads – would likewise be affected
• Advertisers will now focus on second party data and will be relying more on Publishers directly to access the data- ex- identifiers like Login information/ Profile information
• Premium publishers will work more on the product which advertisers are willing to buy once the 3rd party data phase out happens
• The reach of advertising would decline and prices will likely rise as the supply-demand dynamic kicks in.
• Last click attribution might again rule and will the king
• Companies like Facebook, Amazon and Google will continue to thrive because they continue to have access to first party data. 
• The agencies and ad-tech providers and those who have been mastering third-party data will lose their privileged position in this new world
• Contextual targeting will overrule the Behavioral Targeting

Thanks for reading!

Sarang Kinjavdekar