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Data & analytics
EXPERT
The digital media industry has experienced a sea change over the past few years, culminating with Google announcing the planned deprecation of the third-party cookie on its Google Chrome web browser by 2022. While third-party cookies have been on their way out—Apple Safari and Mozilla Firefox browsers already block third- party cookies by default—Google’s announcement sent shockwaves throughout the $565 billion global ad industry. This will be a significant change, but for now, third-party cookies remain the best tools for precision targeting and measurement. However, marketers will eventually need to find new solutions to reach their audiences and validate marketing impact.
Here we answer key questions that commonly arise around what this change means for pharma marketers and how they can best prepare for the new digital ecosystem.
Q: What are third-party cookies?
Cookies are small, unique text files that are placed on web users’ hard drives as a mechanism for recognizing users in different contexts. Cookies have been a fundamental component of the architecture of the web for more than 25 years, helping websites and advertisers solve basic problems related to recognizing users (e.g., an ecommerce website may use cookies to keep the shoes that you looked at last week in your shopping cart).
“Third-party cookies” are cookies placed on a user’s hard drive by an entity other than the website that the user is visiting, allowing for the recognition of the same user across different websites and thus enabling hugely valuable marketing applications. Many of these applications are central to the value of digital marketing. For example, marketers (and their vendors) can connect third-party cookie data to other datasets (e.g., CRM data, demographic data, purchase data, etc.) to build robust profiles on audiences, to efficiently target relevant prospects with tailored messaging across the web, and to measure which ads drive site traffic and ultimately business outcomes.
Q: Why have web browsers started to eliminate support of third-party cookies?
While cookies continue to help marketers strategize, deliver more relevant advertising, and improve user experiences, they are not without faults. Third-party cookies have never been an ideal solution for both marketers and consumers as there’s limited visibility into how they work, what data is collected, and how that data is used. However, between privacy concerns and new regulations, such as the General Data Protection Regulation (GDPR) and California Consumer Privacy Act (CCPA), consumers are demanding increased transparency and control over how their data is used, and the industry is on board. Widespread recognition shows it’s time for the industry to develop a modern, privacy-first approach to digital identity resolution to enable effective targeting and measurement.
Q: How does Google’s policy change affect health marketers?
Because Google Chrome accounts for ~60% of desktop web browsing in the U.S.1, this policy change will affect marketers across verticals, including healthcare, because they will no longer be able to use third-party cookies for targeting and measurement.
While tremendous value is at stake across the ad industry, marketers won’t be affected immediately. Digital marketing isn’t going anywhere—ad spend in this space surpassed traditional ad spend in the U.S. in 2019—so any changes will be gradual, and third-party cookies will not disappear overnight. In the near term, solutions that currently use third-party cookies will largely continue to function as the industry works towards alternatives.
In the longer term, the deprecation of third-party cookies could mean a larger share of ad dollars will go to a few dominant players that do not require third-party cookies to target specific audiences and measure performance. However, advertisers are also wary of ceding more control to notoriously non-transparent walled gardens, especially
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as the deprecation of the third-party cookie continues, marketers will soon need to find new solutions to meet their targeting needs.