Cookie Crumble: Why the loss of cookies is the start of a new era for retail marketing

Troy Townsend, Zitcha's CEO, writes why the upcoming deprecation of third-party cookies, also known as the 'Cookie Crumble', will redefine the retail media landscape.

Cookies, that little piece of code that allows third-party trackers to monitor online activity are about to become extinct.

Regulatory bodies and legislators have passed various laws that get rid of internet cookies. In the European Union, the General Data Protection Regulation (GDPR) was passed, and with privacy on the radar, other countries and governing bodies have already or are moving toward official regulations, and cookies are a top priority to address.

To be compliant with these internet cookie bans or policies, web browsers are being forced to rethink and develop other targeting solutions, which leaves a window of opportunity open in retail media.

When the cookies become dust 

The original timeline set was that cookies would cease to be used in 2022. Browsers such as Safari and Firefox have already complied and are no longer supporting third-party cookies. Google, and its browser Chrome, have pushed the timeline out twice, with the newest deadline for the phase out of cookies occurring in Q2 of 2024. Google says it need more time to conduct tests on its latest technology, a Privacy Sandbox.

The above mentioned Google and Meta (Facebook) have carved out their kingdoms using cookies. These third-party trackers can follow a person’s online activity as they bounce from website to website. In the retail media landscape, cookies can document what products are viewed, what’s been added to a cart, what competitor products are reviewed and so much more.

That data is then sold to advertisers to help them deliver targeted messaging to shoppers interested in the brand’s products. Without cookies, these mega data holders will have a smaller grip on the advertising market, though, they still will have quite a bit of first-party data. Even so, the ‘Cookie Crumble’ presents a chance for new companies to secure a spot in the market.

So, what happens after the cookie crumbles? Once cookies have been fully removed from the equation, targeted advertising will have to take an entirely new approach. The new paradigm is generally accepted to rely on first-party data, or information on customers gathered directly by retailers as second-party data. For example, if a customer gives their information to a big box retailer (or any retailer, really) to sign up for rewards or coupons, then brands at that store will be able to purchase that data and use it for their advertising efforts.

First-party data has always been an option, and now retailers will need to be extra vigilant in collecting and making the most of that information. Additionally, there may be opportunities to sell that information as second-party data, something that hasn’t been explored to its full extent yet as third-party data from advertising giants has so far ruled the roost.

The new retail media landscape

Many leading companies that can afford internal advertising divisions are already making use of first-party data in anticipation of the golden goose of cookies finally expiring, but mid-sized and smaller businesses will likely have difficulty adapting to this new paradigm shift.

In the retail media landscape, having first-party data directly from the customer will become the new gold standard. That means that brands will need to investigate how to collect and leverage their first-party data not only for their own advertising, but potentially as second-party data to marketing partners.

There will be a small window of opportunity to carve out a piece of the action, and retailers should already be exploring how they will navigate and capitalise on the ‘Cookie Crumble’.

Troy Townsend is the CEO of Zitcha. 


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