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What Is Cookieless Tracking: Definition, Impact, and Solutions

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For more than a decade, cookie-based tracking has been curating, collecting, and indexing highly valuable customer data for businesses in all industries.

With consumers demanding greater privacy online, though, third-party cookies are quickly becoming a thing of the past.

It’s now clear that the digital ecosystem needs to change to meet the increasing demand and turn to cookieless tracking solutions instead. Let’s walk through the basics of cookieless tracking, including what it is, how it works, and how you can get started.

What Is Cookieless Tracking?

For years, brands have been using cookies to track a user’s specific behavior online, such as what they clicked on, shopping preferences, and search history. This has allowed marketers and advertisers to build campaigns that target people at an individual level.

Possibly one of the most prominent Google Ad trends for 2021 was Google’s announcement that it will phase out the use of third-party cookies in Chrome, joining a growing list of browsers blocking the cookie-based tracking technology.

The end of third-party cookies, however, does not mean the end of tracking.

Cookieless tracking enables marketers to track each user that visits their websites. This form of web analytics uses scripts that run only when a user visits a webpage, eliminating the need to store information as a cookie on the visitor’s device. The data collected by the script is then sent and stored as “first-party data” in an analytic server.

Cookie-Based Tracking vs Cookieless Tracking

Cookie-based tracking has its benefits. After all, it can fuel business growth by helping brands better understand how consumers interact with them, what behavioral triggers motivate their buying decisions, how to personalize the shopping experience, and how to use ads to re-engage with prospects.

That said, cookie-based tracking has brought along certain disadvantages marketers simply can’t afford to ignore.

The biggest drawback of using third-party cookies is related to user privacy. Because of the widespread use of cookies, data is collected and fragmented by hundreds of ad tech companies across millions of websites, devices, and apps.

With consumers becoming more aware that their data is being collected and sold – and using ad blockers to block ads and their trackers – the end of cookie-based tracking is unavoidable.

On the other hand, cookieless tracking allows you to collect user data while also protecting the anonymity of people. Even more, you get to focus on your own audience data, which will also help you make better-informed decisions during all stages of the sales funnel.

Cookieless tracking has its drawbacks, too. One of the main ones is that you cannot track across sessions. This, in turn, will make it harder to segment users, measure new versus returning users, and build profiles.

How Cookieless Tracking Will Impact Your Business

If your business has been heavily reliant on cookies, the switch to cookieless tracking alternatives can be a challenge. Without tracking cookies, you’ll likely face limitations in how you track users and run ads.

Having said that, remember that third-party data is not the most effective way to build relationships with customers, so in many ways, the phasing out of third-party cookies presents a great opportunity for brands to innovate and rethink how they connect with their audience and potential customers.

Even more, you can still rely on your website audience and you’ll still be able to capture them with your build-in capabilities – without compromising privacy.

Let’s have a look at some other impacts of cookieless tracking for e-commerce and SaaS brands.

Ecommerce Brands

For any e-commerce business, attributing conversions to ads is crucial. After all, improving your approach without knowing what your audience is responding to can be a nearly-impossible task.

With third-party cookies gone, multi-touch attribution – outside of platforms with centralized user data like Google and Facebook – will become less insightful. In effect, e-commerce brands will need to find new ways to measure the efficacy of online interactions and content.

While the way you personalize your ads and messaging to specific users will no longer be the same, advertising on social media would remain, to a large extent, as is.

With that in mind, focus on prioritizing marketing channels and strategies that you have more control over (e.g. building a stronger social media presence).

SaaS Brands

The demise of third-party cookies will affect SaaS companies’ digital marketing efforts, as well.

Many B2B brands rely on cookie-based tracking to build behavior profiles and target users with relevant ads. With the new changes, SaaS marketers will lose access to the highly detailed view of a prospect’s overall browsing behavior across the web, potentially affecting user base growth and sales.

Maintaining the level of personalizations users expect while working with less-accurate data will require a certain level of innovation. This part may take some legwork, but there are several solutions available to brands post-third-party-cookie.

Some cookieless tracking solutions to think about include leveraging your own data-driven insights, doubling down on content, and using machine learning to create lookalike audiences.

How Does Cookieless Tracking Work?

As third-party cookies begin to crumble, the pressure to deliver personalized customer experiences with cookieless tracking is on.

Let’s take a closer look at three solutions that can keep your marketing relevant and future-proof your digital advertising plans.

First-Party Data

Perhaps the most straightforward alternative to cookie-based tracking is relying on your own data.

Data collected from customers directly – also known as first-party data – is made up of various customer interactions across your marketing, website, and apps.

While it might be more limited in scope than data obtained via third-party cookies, first-party data is the most relevant and reliable way for identifying your audience, their path to purchase, the ways they engage with your brand, and the best ways to reach them.

Contextual Advertising

Contextual advertising offers another solution to the loss of third-party cookies.

The goal of contextual advertising is to strategically place ads on pages that are directly related to the content of the ad. Here’s an example of a contextual ad for shopping behavior data report in the Markets section of the Wall Street Journal:

Source: wsj.com

Unlike cookie-based tracking, contextual advertising doesn’t rely on specific information about visitors to deliver relevant experiences. Instead, it accounts for the environment in which the audience is browsing and targets context.

Done well, this model is an excellent way to serve relevant ads, protect user privacy, and create immensely impactful ad campaigns.

Whitelisting

As cookies vanish from the scene, whitelisting might be a viable solution for some businesses. Unlike contextual advertising, where your ad’s content needs to match the context of a specific page, whitelisting allows you to target a list of industry-relevant channels, domains, and apps and serve various ads to the users visiting them.

Simply put, whitelisting enables brands to give advertising permission to their partners. When an account (e.g a different brand or an influencer) is whitelisted, you can run ads through that account and alter the content for a particular niche.

In such cases, to increase the conversion rate, you will need regular maintenance and optimization.

What Does the Cookieless Future Hold?

Without a doubt, the shift towards privacy-first advertising will greatly impact the digital marketing ecosystem.

In the cookieless future, marketers and advertisers will no longer be able to access the individualized data that they’ve relied upon to create ads, retarget users, and provide customers with highly personalized content.

To stay ahead of the curve, brands will need to prepare by leaning into cookieless tracking methods that maintain user privacy and trusted opt-in channels for targeted marketing.

Skilled and adaptable businesses that focus on trust will likely be the ones to overcome the death of third-party cookies and see a positive outcome in the upcoming years.

Ready to start preparing for a cookie-free digital world? Learn how to cope with the impact of the cookieless future to keep pace with the changes.