Cookies are all you ever seem to hear about these days because they are becoming a growing concern amongst brands. We know that cookies are being slowly phased out, but what is their replacement? This simple guide will tell you everything you need to know about cookies and the potential solution to a cookie-less world.

But, before getting into the exciting part, I want to explain briefly why cookies, or rather identifying users, is important.

What are cookies?

Unfortunately we’re not talking about the tasty snack, but another pretty sweet invention. Cookies are a small code that web browsers use to track user data. This provides brands, website owners and advertisers with vital information on their target audience. But where did it all begin?

Cookies were first created as a small code to identify the user as a returning customer, which is what we call first party data. This made life easier for users by remembering things like passwords and usernames so that they didn’t have to login every time.

However, like all technology, cookies evolved to start remembering things like what users left in their baskets or products they last saw. This allowed brands to start customising things like landing pages and emails to the individual based on their interests, which was not only beneficial for the consumer as they were receiving information relevant to them, but allowed businesses to be more targeted with their messaging.

But it didn’t stop there! Cookies evolved even further to what we call third party data. Companies such as advertisers now have access to part of that information including user’s intent and demographic, which means we can deliver effective advertising by serving more relevant ads.

So why are cookies going out?

Cookies were created in 1994 to deal with a new emerging thing that people called “the internet”, which at the time could only be used on a PC. However, technology has progressed quickly. We now have smartphones, tablets, smart TVs, ads on games, smart fridges, smart toilets (no, seriously), which are all internet enabled, meaning we need a better solution to sort data in an ethical way.

Furthermore, tech platforms like Apple, Firefox, Meta, to name but a few, have also begun to limit the use of third party cookies. This is due to various reasons such as users becoming increasingly concerned with how their data is being used. Therefore, we have already begun to enter a world where cookies are becoming old news.

The future of cookies

Now we get to the interesting part. It’s time to see what a world without cookies may look like. At first there was only a hypothesis about the future of cookies. Then there were a few options to replace the cookie but none got adopted by multiple partners. Even today there is still no solution that works across multiple channels.

However, The Trade Desk launched the ‘Unified ID’ in 2021, which was the first breakthrough. This then progressed to ‘Unified ID 2.0’ or ‘UID 2.0 as an open source’.  The Trade Desk then passed this technology onto the IAB Tech Lab later that year.

What is UID 2.0 and how can it replace cookies?

At its most basic principle, the UID 2.0 collects personally identifiable information, also known as PII data. This includes everything from an email address, to a phone number at the time of login/sign up, from a website, mobile, app, or even connected TV.

As more and more advertisers, publishers and tech companies adopt UID 2.0, the user can be tracked across more sites. This creates a unified ID of the user across all platforms (hence the name).

However, the users identity is protected which is where UID 2.0 differs from cookies. Their personal data is encrypted at all times, for example, encrypted email addresses are used instead of real ones. The unified identifier they are assigned also regularly changes to maintain security. Therefore, the key point of UID is to put privacy, transparency and security first.

How is UID 2.0 different for the user? 

It is all about privacy and control of your data.

  • Power to the user: with UID 2.0 you can actually log in and monitor/adjust how your personal data is being used, in a single and central way
  • Pseudonymisation: there is no information about the user that ties it to the physical world, and the email/phone is salted and encrypted. The IAB uses Tokenisation to maintain the connected tissue between all parties, but no one can link back the token ID to the user
  • Transparency: something in the marketing industry has sadly been badly hurt by dodgy practices from all parties. I am not saying that UID 2.0 is going to fix all of that, but at least as a user there is more control and access to the information companies have of you.

Next steps

This is already a reality and is being used, so if you have any questions about how dependant your media buying is on cookies and how to transition to a better solution now, please reach out to us, and we will be happy to start a consultation.

Guillermo Dvorak - Head of Digital

Author: Guillermo Dvorak - Head of Digital

Guillermo considers himself a tech nerd and has over 10 years’ experience in digital media planning & buying across multiple industries, helping brands develop their digital maturity to improve customer engagement and lifetime value.