Last week Firefox announced that their upcoming version 22 will have a changed default privacy policy which will prevent the use of 3rd party cookies.  As Mike Zaneis @mikezaneis SVP and General Counsel for the Interactive Advertising Bureau (IAB) puts it in his Tweet the other day:

Firefox to block 3rd party cookies? Read Here . This default setting would be a nuclear first strike against ad industry

What are 3rd Party Cookies:

As many of you probably know, many systems and tools used by websites to manage tracking, reporting and serving ads rely heavily on the ability to store identifiers and data in cookies. A 1st party cookie is a cookie set from within the sites own domain or sub-domains. Cookies set from any other is classified as a 3rd party cookie.

How does this affect you?

As a publisher relying on advertising revenues and advertising being served and tracked by external systems this does have an impact on your business and operation to a larger or lesser degree and it is recommended that you make yourself familiar with the consequences and the options available to you.

Cookies are used for many different functions, some of which are tracking user data and behavior but also for more practical uses. In the scope of online advertising here are some of the one of the most basic uses which may be affected:

• Unique Browser statistics: If cookies are blocked, the reported Unique Browser figure will increasingly become inaccurate. Depending on how the measuring system you use handles blocked cookies the reported number might overstate the number (if each unidentified browser is counted as a new unique user) or understated if unrecognized browsers are ignored.
• Frequency Capping: Frequency capping is a method of controlling and limiting the number of ad impressions of a given advert or ad-format which is shown to a Unique Browser. If cookies managing capping rules are blocked these capping settings can not be enforced and will lead to users potentially receiving a disproportionate large amount of these ads. In may cases this may not matter to the user however if these ads are large or intrusive formats this may lead to user irritation.
• Re-targeting: All re-targeting functions require 3rd party cookie tracking. In this case a small script or code is places on the advertisers web site by the re-targeting system which by virtue of the function needs to be delivered from a domain it has access to read from across the web.
• Affiliate / CPA tracking: Many affiliate programs and their systems rely on 3rd party cookies to keep track of the source of referral and the users subsequent purchase or other valued action. This is especially true for View-through conversions, but in many cases even for Click-though conversions. Some affiliate programs use a referrer ID with the click which replaces the needs to cookies and will continue to function effectively.

Are there any positive effects for Publishers?

As a content publisher, there might actually be a positive side-effect to this new setting. And quite possibly a larger one might at first imagine.

During the past 3-4 years data-centric ad networks, ad-exchanges, real-time-bidding (RTB) platforms (including SSP’s, DSP’ with the help of DMP’s) has started to change the balance of power between advertiser, agencies, distributors and publishers. Moving the value focus from an audience and context value from the publisher to a data value focused on the user and her previous browsing habits and history. More and more advertising spend is pushed into ad-networks or varying forms which trade in user profiles as opposed to publisher content. In Scandinavia the shift has so far be relatively minor with estimates that around 10% of big-agency online spends going this way, but in the UK and USA this number for some large agencies is approaching or even exceeding 50%. The impact is that the value of an ad-impression that a publisher has is only valued as a commodity, later enriched with value adding data from the network channel and sold at a high markup to the advertiser. Studies have shown that up to 70% of the ad-value is retained by the distribution channel, ie. in many cases only 30% of the income actually reaches the publisher.

If this trend of blocking 3rd party cookies increases it will limit the effectiveness of these data-centric ad-sales and distribution platforms and may bring back the value of content and context, which would favor publishers.

How can Adtoma Fusion help you minimize the negative effects?

More Reading:

http://blog.mozilla.org/privacy/2013/02/25/firefox-getting-smarter-about-third-party-cookies/

http://webpolicy.org/2013/02/22/the-new-firefox-cookie-policy/?utm_source=rss&utm_medium=rss&utm_campaign=the-new-firefox-cookie-policy

http://associationsnow.com/2013/02/firefoxs-cookie-crunch-advertisers-privacy-advocates-at-odds/

http://associationsnow.com/2013/02/firefoxs-cookie-crunch-advertisers-privacy-advocates-at-odds/

Business Intelligence

Get your Intelligence from one place

• Analytics and visualization
• Collaborate and share
• Enjoy the benefits from day one

Adserving

Run your Advertising from one place

• Web, eMail, Mobile & Applications
• Text, Advertorial & Display
• Rich Media & Video
• Sponsorships or eCPM Optimized
• Run of Network or Targeted

Workflow

Run your Company from one place

• Contacts & Activities
• Proposals & Orders
• Products, Inventory & Price lists
• Bookings & Follow-up
• Invoicing & Revenue Sharing