Thriving in 2022: The Post-Third Party Cookie Landscape
Ever since the mid-1990s, affiliate marketers have relied on third-party cookies to track consumer behavior. Affiliates and brands both benefited from the partnership: affiliates made money off sales of the items they love and mention in their posts, and brands could get their products in front of their ideal audiences on a much smaller budget. Even better, brands could track with certainty where their sales were coming from and double down on rewarding the affiliates that drove the most traffic.
But nothing lasts forever, and consumer privacy concerns mean the end of the third-party cookie era. Some browsers, like Safari and Firefox, already restrict how third-party cookies can be used. And earlier this year, Google came right out and said it: in 2023, it will no longer support third-party cookies in its Chrome browser – the most popular web browser globally, accounting for 65 percent of the market share.
The problem for advertisers is that consumers don’t want to be tracked in any identifiable way. Whether it’s backlash from overly personalized campaigns or just a desire to stay anonymous while shopping online, their desire for privacy became glaringly apparent in the mobile ecosystem. Apple restricted applications from using unique identifiers for advertising services in iOS 14.5. Users can opt-in to be tracked, and advertisers expected 30 to 40 percent of users to consent once iOS 14.5 was released. The reality is, only four percent opted in to be tracked on their iPhones – mere crumbs.
Retargeting and Programmatic Campaigns Will Be Hardest Hit
For marketers that rely on retargeting and programmatic campaigns, the end of the third-party cookie makes it incredibly difficult to track campaign performance. This model will be nearly impossible to use going forward if browsers’ restrictions and users’ opt-ins to tracking on their mobile devices are any indications.
All isn’t lost for marketers that want to launch targeted campaigns, however. They can still use first-party cookies to create lookalike audiences and target different personas. While getting rid of the third-party cookie, Google encourages the use of Federated Learning of Cohorts (FLoC). This interest-based advertising model essentially groups people with similar interests so that marketers can target them with relevant ads. The consumer won’t receive an advertisement for the exact items they were just looking at on a brand’s website. Still, over time the machine learning algorithms in the browsers develop cohorts that help marketers offer relevant ads to them – for example, rock music fans in Florida.
The First-Party Cookie Hasn’t Crumbled
Meanwhile, brands who rely on partnership marketing must look for a viable workaround in the wake of the third-party cookie’s demise. First-party cookies for logging in to websites will still exist – the web can’t function without them. Affiliates will need to jump on ways to track behavior using first-party cookies, such as universal tracking tags and server-to-server tracking.
The second option uses server-to-server tracking. Like universal tracking tags, the brand records information passed to them in a query string. When the consumer clicks on an affiliate link, the URL that takes them to the brand’s website also tracks the consumer’s behavior. It gets sent in a server call to the affiliate technology after the transaction. The brand can track the affiliate it came from and the dollar value of the order to give credit to the affiliate, based on parameters that are set in the technology.
However, many brands haven’t updated their tracking protocols and still rely on legacy third-party cookie technology. For these brands, the first step is to update their integrations with various partner platforms to support first-party cookies. They will need to successfully track consumer behavior and purchases as changes to third-party cookie handling roll out.
The good news for partnership marketing is that the industry won’t be significantly impacted by the changes to third-party cookies. Because it’s still outcome-based, brands can track that a consumer clicked on an ad and purchased directly from the affiliate link.
Partnership Marketing Can Maximize ROI
While no one can predict the future, partnership marketing likely won’t be disrupted in the near term. Most affiliate technologies can track consumer behavior based on first-party cookies, as long as the advertisers update their protocols for these new standards. For brands that want to have tight measurement KPIs on their advertising campaigns, partnership marketing will be one of the few channels that provides certainty about where the traffic came from and whether the marketing spend is effective.
Brands need to embrace opt-in marketing from first-party cookies to survive in the wake of the third-party cookie’s demise. It will require working with partner platforms and publishers to ensure they’re all providing value to the consumer – and hence, seizing the opportunity to further build trust and increase conversions. Now is the time to shore up and strategize for brands that haven’t started or are only using partnership marketing as a small component of their marketing spend as we head into 2022.