It's time to trade cookies for community

Third-party cookies are set to be phased out by the end of 2023. What does this mean for publishers, and how can they future-proof their revenue streams?
It's time to trade cookies for community
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In January 2020, Google announced plans to phase out third-party cookies on their Chrome browser by 2022. Though this date has since been moved back to 2023, Chrome’s 69.28% share of all web browser traffic meant the announcement served as a death knell for the cookie - as well as a stark warning to the publishers who rely upon them.

The end of cookies is another reason why many publishers and information providers are building branded online communities for their audiences. Communities like these have long held the power to turn audience members into paying subscribers; now, in a post-cookie world, they can provide publishers a direct route to generating first-party user data.

But why does any of this matter - and how can communities help? To answer this, we first need to understand the role cookies play in our web landscape.

Why are cookies important?

When discussing the role of cookies, it’s important to recognize the difference between first-party and third-party cookies and the different roles both play. First-party cookies are collected by a website when a user accesses it, with the only beneficiary of the data being the owner of that website. This organization can use the data to provide a more personalized experience to each customer. These cookies are not the ones being phased out; third-party cookies, which amalgamate user information from across a variety of websites to be sold off to any number of other organizations, are being targeted due to concerns over data privacy.

For publishers, third-party cookies are key to driving ad revenue. Cookies allow publishers to make their own web traffic profitable, with the data they acquire allowing sponsors to run personalized ads, measure their effectiveness and target the same users repeatedly across multiple websites. With a clearer overall view of the customer, publishers can deliver greater value to sponsors, offering proof to other prospective sponsors that investing in that publisher is a good use of their budget.

What will a post-cookie world look like?

With cookies currently in use in all corners of the web to identify and authenticate visitors to websites, there is no doubt that their being phased out will have major ramifications for publishers. Cookies are currently used to segment audience lists in order to deliver personalized ads; without the ability to track user behavior across a range of websites, it will become harder to do so with any real accuracy. Advertisers will subsequently be unable to identify audiences that are a good match for their product, meaning publishers will not be able to attract revenue from these sources.

Cookies are also used to measure the effectiveness of ads across multiple devices. Without cookies collecting data, advertisers will be unable to see if their investment is having a direct effect on user behavior, as it will be impossible to track users across various sites. Once again, this will ultimately punish publishers, who will be unable to demonstrate ROI to sponsors.

For publishers, all of this means that monetizing web traffic will become difficult at best, and virtually impossible at worst. Orchid Richardson, vice president of the Interactive Advertising Bureau’s Programmatic & Data Center, has expressed concern over the level of preparations made by publishers for the end of third-party cookies. In March 2021, the IAB reported that 76% of decision makers within brands, publishers, ad tech, agencies, and data companies felt that they were prepared for this impending loss, despite spending on third-party audience data actually rising by 3.3% in 2020. The IAB went on to predict that publishers would be forced to replace up to $10 billion in ad revenue through other sources, primarily the acquisition of first-party data. Elizabeth Brennan, head of advertiser strategy at Permutive, predicts that publishers “are going to become the guardians of targetable, scalable data in the new privacy-first way of working” due to their ownership of first-party data at a scale which provides genuine insight to advertisers.

I’m a publisher - what do I do now?

According to a survey by ENGINE Media Exchange, 98% of publishers have developed plans for a cookie-free route to monetizing their web traffic; however, the same survey also reveals that less than half of these organizations have actually begun implementing these solutions. Publishers affected by the loss of cookies will need to bring in paywalls and mandatory registration in order to acquire user data for themselves, rather than simply relying on cross-site targeting. The problem with this is that it dramatically alters the relationship between publishers and their readers, with the onus now placed upon publishers to deliver a product compelling enough to warrant subscribing to or even paying for.

Many publishers have taken steps to ready themselves for the end of cookies by building expert communities around their content. Communities like these provide publishers with more opportunities to collect first-party data, such as registrations and paywalls. This means that publishers can keep their revenue streams intact long after third-party cookies cease to be in operation

Publishing today is about creating an experience for subscribers, with many leading brands seeking to provide networking opportunities and access to one-to-one expertise in order to convert free readers into paid ones. Expert communities make this possible by giving publishers a space for their subscribers to not only engage with content but also interact with one another and gain insights that cannot be found elsewhere. 

Case study: OnMedica

OnMedica is an online community developed by Wilmington Healthcare. It provides UK-based GPs and specialist doctors with an independent environment, packed with clinical reference material and expertise, education, news, views and comments. 

The community uses powerful integrations and analytics to deliver highly targeted ads to its user base of over 7000 healthcare experts. Working alongside Zapnito, Wilmington Healthcare were able to develop an innovative verification system for OnMedica by designing a workflow which required new members to provide their GMC number. This made it possible to verify the qualifications of members to ensure only GPs could access the materials within the community, thus making it possible to generate revenue through sponsorships from pharmaceutical brands. 

OnMedica offers multiple sponsorship packages, opening the door for a wider range of sponsors to market their wares in the community. Having successfully established the community as a trusted resource for GPs while simultaneously taking back control of their first-party data, Wilmington Healthcare have insured themselves against the impact of cookies being wiped out.

Take back control of your data

If you’re a publisher and you haven’t yet begun preparing for the end of third-party cookies, consider this a warning: the time is now to take back control of your user data. With less than two years to go before cookies are eliminated, there is still time to future-proof your revenue streams - but that time is running out.

Expert communities offer brands the ability to acquire first-party data and permissions, increasing sponsorship revenue, but this is far from the only way they stand to benefit publishers and information providers. A community allows these organizations to provide a space for their subscribers to learn, discuss and engage with content together, offering far greater value than content alone ever could. In building an expert community, publishers achieve more than just protection against the end of cookies; they also acquire a valuable asset that provides all the experiences and connections their subscribers are willing to pay money for.

By becoming a trusted partner to your subscribers, you can maximize the lifetime value of existing subscribers and reach new ones. As users reap the benefits of their own success, they become advocates for your brand too. The priority for publishers this year should be acquiring ownership of their data - expert communities provide this, along with much more.

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