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The Cookie Is Dead, Long Live GDPR

 

It is 2018 and the cookie is finally dead.

While advertisers have been saying this for years, most executives now believe that the cookie is truly living on borrowed time.

In fact, Viant's "Power of the People" report found that 64% of executives believe that companies will stop using cookies altogether within the next two years.

So why is this happening now?

Here are the top technological and regulatory advances that have managed to kill off the cookie forever.

 

Cookies Are Simply Not Effective at Targeting Specific Users

Let's start with the most obvious problem with cookies: they're just not effective.

Advertising is all about driving consumers to take action.

That means that advertisers need to reach consumers via the channels and devices where they spend the majority of their time.

“Cookies were designed to count individual browsers, not people.”

While cookies were once effective for targeting users on specific web pages, most people aren’t sitting at home browsing the internet on their desktop computers.

They’re using mobile phones, engaging with IoT devices, and essentially browsing apps and the internet from a variety of different devices through the day.

Now that consumers aren’t limited to a single device, cookies are pretty much obsolete.

Two-thirds of connected devices don't accept them.

Cookies don't even really work on mobile. They can't function within mobile apps, which accounted for nearly half of global internet traffic in 2017.

They also slow down the mobile browsing experience.

In addition, the majority of cookies expire within just days or weeks, making it impossible to track users for a long-term advertising campaign.

Cookies aren’t even capable of targeting specific users on the same browser or device, rendering them useless for prospecting in a B2B environment.

As a result they often overstate the reach of a campaign while understating the frequency, causing advertisers to waste ad spend.

These days, advertisers must be able to deliver personalized campaigns to people on all of their connected devices.

Innovations in programmatic technology mean that new cookie-free digital advertising platforms, such as Passendo, are rapidly replacing cookie-based digital ad targeting solutions.

Why Browsers Are Blocking Third-party Cookies

The cookie is essentially an outdated relic of web-based browsing that has dominated internet usage statistics for nearly 20 years.

Having a go-to channel for tracking users, albeit poorly, has allowed the cookie to live on well past its expiration date.

Tracking users in order to stalk them with advertising has gone on for so long that many internet companies have simply opted to ignore consumers repeated demands for less tracking and less intrusive advertising.

Worldwide, 615 million devices have ad-blocking software installed on them, according to a 2017 report from PayFair. This figure grew by 30 percent year over year.

As consumers continue to opt-out with ad blocking software, tech companies that issue web browsers have taken notice.

“Ad blocking browsers have ended the party for irresponsible advertisers.”

In 2017, both Google and Apple announced that all future versions of Chrome and Safari, their respective web browsers, will have certain types of advertisements automatically blocked.

Apple also released a new tool for Safari that blocks third-party ad trackers.

The tool, Intelligent Tracking Prevention, utilizes machine learning to classify which top privately-controlled domains are capable of tracking users across the web.

By measuring user engagement with a particular domain, the tool can gauge whether or not a user is interested in the website and purge cookies from websites where users have shown low engagement.

This system is designed to keep users from being tracked by sites that don't interest them.

Google Chrome already allows users the option to allow or block cookies.

Now Chrome automatically blocks the ads that users find most annoying.

The new built-in ad blocker for Google Chrome, which affects both desktop and mobile devices, has already gone live.

So why have browsers become so adamant about killing off the cookie?

While they care about user experience, new privacy regulations in the E.U. have helped to move the changes ahead at a faster place.

GDPR Is Here to Stay

The General Data Protection Regulations (GDPR) is the final nail in the coffin for the cookie.

The E.U. has finally stepped up, on behalf of consumers everywhere, to put an end to intrusive data collection without the consent of the users.

All companies, including Google and Apple, are required to comply with the new rules.

GDPR requires advertisers to obtain explicit consumer opt-ins for each and every user if they collect personal data.

It also outlaws the sale of third-party data.

One of the most important caveats of the new legislation is the fact that technical identifiers, such as cookies, are now considered as personal data.

As of May 25, 2018, advertisers who do not comply with these regulations, both those within the E.U. and those that have E.U. users although they are located elsewhere, will face stiff penalties if they continue to use cookies to track users without their consent.

Given that cookies really weren’t all that effective in the first place, and now new restrictions, it really just doesn’t make any sense for advertisers to continue to track users with cookies.

Moving Forward With New Digital Advertising Technology

While the transition to cookie-less advertising requires a strategy revamp for advertisers, you should be absolutely thrilled that cookies have finally died off.

Now you can focus on advertising that brings superior returns, instead of results that are simply “good enough.”

At Passendo, we understand that advertising has changed and we're ready to help you make the transition.

Our 100% cookie-free and GDPR-compliant tech allows you to connect with your audience with unparalleled accuracy.

Instead of looking to the past, we’ll help you prepare your business for the changes ahead.

To learn more about advertising through Passendo SSP, please contact our dedicated team: sales@passendo.com.

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