As digital advertising has become increasingly data-driven, third-party cookies have played a crucial role in tracking users’ online behaviour and delivering personalised ads.
However, with the phasing out of third-party cookies by major web browsers, brands that have relied heavily on this technology are now facing a serious challenge.
An over-dependence on third-party cookies is about to backfire on brands. With users becoming more aware of their online privacy and security, third-party cookies have been scrutinised. In addition, web browsers like Google Chrome, Firefox, and Safari have announced plans to phase out third-party cookies, leaving advertisers scrambling for alternative solutions.
This shift in the digital advertising landscape is forcing brands to rethink their approach to audience targeting and personalisation. Instead of relying on third-party cookies, brands are exploring new technologies like first-party data, contextual targeting, and artificial intelligence to deliver personalised ads and measure ad performance.
Adobe has released new research indicating that brands are failing to adapt their data strategies despite the potential long-term impact on their businesses. The research surveyed over 2,600 marketing and consumer experience leaders (including 656 in APAC) and also explored the investments and strategies that set industry leaders apart.
Most brands in APAC (79 per cent) continue to rely heavily on third-party cookies, with over half of leaders (56 per cent) anticipating negative impacts on their businesses due to the phasing out of these cookies.
The research highlights a lack of clarity around cookie deprecation, causing confusion and leading to inaction among some brands. In fact, 38 per cent of APAC leaders surveyed stated they are staying the same marketing strategy due to a perceived lack of urgency, while others are delaying preparations for a cookieless future.
Overdependence on third-party cookies is about to backfire
The study further found that many leaders in the APAC region expect the end of third-party cookies to harm their businesses. In fact, 34 per cent of respondents said it would “devastate” their businesses, while 21 per cent anticipated significant harm and 25 per cent predicted a moderate negative impact. In Australia, the numbers were even more concerning, with 54 per cent of leaders surveyed expecting devastating or significant impacts from cookie deprecation.
Despite acknowledging the risks, many heavy third-party cookie users feel they have no other option, with 60 per cent of cookie-using leaders viewing cookies as a “necessary evil.”
However, continued overreliance on cookies is seen as a losing strategy for the long term. One in three respondents (37 per cent) said they lacked the resources to evolve their strategies, a number that rose to over half of the leaders (56 per cent) in Australia.
Brands rely heavily on third-party cookies
Despite the impending end of third-party cookies, a staggering 52 per cent of APAC leaders allocate at least half of their marketing budgets towards cookie-based activations, with 79 per cent planning to increase spending on cookie-dependent activations this year.
The reason? Leaders believe that third-party cookies are highly effective, with 81 per cent of them in APAC relying heavily on them. Shockingly, 23 per cent of respondents from Australia even believe that third-party cookies aren’t going anywhere.
However, the consequences of this dependence on third-party cookies are dire. A significant 86 per cent of APAC leaders at cookie-dependent companies claim that at least 30 per cent of their potential market is in environments where third-party cookies don’t work, such as social media platforms and on Apple devices. Furthermore, 59 per cent of them report that half or more of their potential market is in cookieless environments.
This mistake will not only prevent businesses from reaching a significant portion of potential customers immediately but will also continue to compound with every passing quarter as the cookieless frontier expands.
Brands are turning to Customer Data Platforms (CDPs) to help them prepare for a future without third-party cookies, and even for the cookieless present.
According to recent research, more than half (54 per cent) of APAC leaders who use CDPs have already experienced direct relationships with customers, a rise in customer loyalty (42 per cent), and an increase in the number and value of completed transactions (41 per cent). CDPs also improve internal workflows, with 46 per cent saying it enabled better and faster work across marketing and IT, and more efficient ROI production (35 per cent).
Adobe Real-Time Customer Data Platform (Real-Time CDP) is one such platform that delivers billions of predictive insights each year based on real-time customer profiles.
These insights enable teams to engage customers who are likely to make a purchase or who may be considering switching to a competitor. Real-Time CDP has become the preferred customer experience engine for leading brands in various industries, including Coles, SBS, and Suncorp.
Brands leverage Customer Data Platforms
“Companies that aren’t diversifying their strategies are leaving money on the table today, and hurting their chances of gaining competitive advantages in the future,” said Gabbi Stubbs, APAC Product Marketing and Strategy, Adobe.
“While a wholesale change in strategy takes commitment and long-term investment, the benefits are undeniable across all currencies that matter—from customer loyalty and satisfaction to a better bottom line.”
Keep up to date with our stories on LinkedIn, Twitter, Facebook and Instagram.
