<\/p>\n\n\n\n
The Cookie Crunch <\/strong><\/h2>\n\n\n\n
<\/p>\n\n\n\n
For several years, the online\nadvertising industry has been taking steps to increase the transparency and\nclarity of the ecosystem in which it operates. One area where significant\nchanges have already taken place is the policy regarding the use of data\ncontained in user browsers, known as third-party\ncookies<\/strong> or tracking cookies. <\/p>\n\n\n\nNew solutions for collecting people\u2019s data are crucial for Publishers, who are always looking to create the right target group for potential clients. And since data protection is under constant surveillance, major companies are having to come up with new initiatives aimed at preventing third parties from infringing on user privacy.<\/p>\n\n\n\n
Before the implementation of the EU\u2019s <\/a>General Data Protection Regulation (GDPR<\/a><\/strong>) users were hardly ever notified about third-party cookies. Collecting user data was bread and butter for publishers and advertisers, who consequently received a negative response from people wanting to protect their privacy. Since GDPR demands that website owners notify users about the purpose of third-party cookies on their website<\/a>,<\/strong> people have become more aware of e-Privacy issues and subsequently want greater transparency from publishers. Some of the browser players have met such expectations and come up with solutions aimed at protecting users\u2019 data and not allowing publishers and advertisers to create a more personalized message based on the information gathered.<\/p>\n\n\n\n
<\/p>\n\n\n\n
Browsers and Third-Party Cookies<\/strong><\/h2>\n\n\n\n
<\/p>\n\n\n\n
From mid-2017, leading browser\nproviders began adapting their products to what would be a challenging future.\nGiven the importance of tracking browser data, creating personalized\nadvertising had been the primary source of revenue for the majority of\nPublishers. Consequently, all new corrective features could only bring about a\ndecline in revenues.<\/p>\n\n\n\n
When we look at the balance of power in the browser market (YB data, Q42018) at the end of 2018, there were 3 players:
1. Google Chrome
2. Firefox
3. Safari
<\/p>\n\n\n\n![\"\"](\"https:\/\/yieldbird.com\/wp-content\/uploads\/2020\/01\/1-1024x632.jpg\")
<\/figure>\n\n\n\n
The undeniable market leader was Google Chrome with over 68% in total revenue shares. Almost 15% of traffic went to Mozilla Firefox and 7.7% to Safari (Apple).
Before looking at Firefox, let us consider its major competitors. Apple was the first to introduce changes in the tracking of cookies<\/strong><\/a>. But as we can see, ITP didn\u2019t translate into a noticeable drop in revenues. This was mainly due to the scale of Safari usage.
Undoubtedly, an unknown quantity for 2020, which carries a big revenue risk, is Google Chrome\u2019s new secure-by-default model for cookies that are going to be released in February. This new feature is set to limit the sending of third-party cookies in cross-site requests, except for those cookies that are secure or have been flagged by SameSite.<\/p>\n\n\n\n
<\/p>\n\n\n\n
No more Third-Party Cookies for Firefox – How the new feature is set to impact Publisher revenues <\/strong><\/h2>\n\n\n\n
<\/p>\n\n\n\n
<\/strong>Firefox has decided to make truly impactful changes<\/strong><\/a>. <\/strong>At the beginning of September 2019, the Enhanced Tracking Protection (ETP) mechanism was launched. It is a mechanism directed against external cookies that can be used to collect user data in order to build complex profiles (later used by advertisers). <\/p>\n\n\n\n![\"\"](\"https:\/\/yieldbird.com\/wp-content\/uploads\/2020\/01\/2-1024x632.jpg\")
<\/figure>\n\n\n\nAs Firefox is one of the most popular browsers which our Publishers are making recourse to, we have decided to take a closer look at ETP in order to assess how these new features may affect Firefox\u2019s revenue share and performance. For the period October-November 2019, we saw a significant drop in Firefox\u2019s revenue share of 5 percentage points (compared to Q4 2018 \u2013 Chart 1.). More importantly, we can see that Firefox\u2019s revenues were absorbed by Chrome (Safari’s shares have remained almost unchanged). In the context of such a disruption, Advertisers have transferred their budgets almost entirely to Chrome so as to not put their businesses at risk. Due to Firefox\u2019s privacy protection, Firefox has been unable to reach potential customers using the data that third-party cookies should collect. <\/p>\n\n\n\n
However, has this change has\naffected Publishers? Let\u2019s look at this problem by analysing Publisher\nperformance from several major geo-locations based in Western and Central\nEurope before and after the implementation.<\/p>\n\n\n\n
This change came into force at\nthe end of Q3 and was already in force throughout Q4. Due to the annual\nseasonality of this period, we could expect to see increase performance\neverywhere. However, the following data proves that Firefox experienced\ndifferent trajectories entirely.<\/p>\n\n\n\n![\"\"](\"https:\/\/yieldbird.com\/wp-content\/uploads\/2020\/01\/6-1-1024x202.jpg\")
average daily RPM change (after 3.09) vs. data range 1.06- 30.11<\/strong> <\/figcaption><\/figure>\n\n\n\nIf there had been no change,\nwe could have expected fairly similar results for Firefox, in line with other\nbrowsers. The selected countries did not report drastic changes in their\nperformance. In Poland and Germany, a decline in the daily average RPM after\nSeptember 3, 2019 could be discerned.\nThe following graphs clearly show that “something did change” in the\nperformance of Firefox, but that it was not a massive disruption.<\/p>\n\n\n\n![\"\"](\"https:\/\/yieldbird.com\/wp-content\/uploads\/2020\/01\/3-1024x632.jpg\")
<\/figure>\n\n\n\nMeanwhile, when we analyse the\ndaily RPM levels at the beginning of September, we see significant decreases in\nFirefox and almost immediate – somewhat unusual – increases in non-Firefox\ntraffic, regardless of localization.<\/p>\n\n\n\n
Before the introduction of the new feature, Firefox and non-Firefox browsers remained stable. Whereas after the implementation of the ETP, Firefox continued to note a decrease in RPM levels. Since some advertising budgets moved from Firefox to other browsers, an increase in the performance of other browsers can be seen. We estimate that publishers in Poland could have experienced a decrease in revenues of around 1.3-2.0% related to the change implemented.<\/p>\n\n\n\n![\"\"](\"https:\/\/yieldbird.com\/wp-content\/uploads\/2020\/01\/4-1024x632.jpg\")
<\/figure>\n\n\n\nSimilar trends have been\nobservable in Slovakia. The RPM result may have arisen from the fact that in\nSlovakia the Firefox\u2019s performance was always a little below the performance of\nnon-Firefox browsers. We estimate the overall decline at around 0.2%.<\/p>\n\n\n\n![\"\"](\"https:\/\/yieldbird.com\/wp-content\/uploads\/2020\/01\/5-1024x632.jpg\")
<\/figure>\n\n\n\nFirefox on the German market\nhad the largest revenue shares compared to Poland or Slovakia. Before the\nintroduction of the new feature, Firefox was very popular in Germany \u2013\naccounting for 28% of revenue.<\/p>\n\n\n\n
In this case, the decrease in\nFirefox performance was substantial (average -6.5% per day). Firefox\u2019s\nperformance which before the change remained similar to non-Firefox browsers currently\nis gradually falling. We estimate that the decline in the total revenues of\nGerman Publishers could have suffered by about 7-8%.<\/p>\n\n\n\n
<\/p>\n\n\n\n
Initial thoughts<\/strong><\/h2>\n\n\n\n
<\/p>\n\n\n\n
Limiting third-party cookies involves long-term consequences across the marketing and advertising spheres but there\u2019s no need for unease. Programmatic advertisers need to find a solution that will enable them to target users with personalised ads, but also to ascertain whether ads will lead to sales. Even if publishers won\u2019t be able to <\/strong>monetize their website with Firefox<\/strong><\/a>, they can move their investment to other browsers, choose one of the existing solutions like IDify, or select marketing channels that don\u2019t rely on cookies.<\/p>\n\n\n\nNaturally, things might change\nwhen Google Chrome phases out third-party cookies in Chrome over the course of\nthe next two years. This event might be extremely disrupting for marketers and\npublishers who mainly depend on advertising. In the worst case, Publishers\nmight initially expect the decrease of global revenues – especially in the\nsituation where advertisers would no longer have a space to move campaigns in\nsearch of cookies. Being aware of this, currently Google is looking for\nsolutions that will support Advertisers\u2019 advertising activities of publishers\nand advertisers. We need to take into consideration that the majority of\nGoogle\u2019s revenue comes from digital ads, so a resolution can be expected.<\/p>\n\n\n\n
<\/p>\n\n\n\n
New solutions for collecting people\u2019s data are crucial for Publishers, who are always looking to create the right target group for potential clients. And since data protection is under constant surveillance, major companies are having to come up with new initiatives aimed at preventing third parties from infringing on user privacy.<\/p>\n\n\n\n
Before the implementation of the EU\u2019s <\/a>General Data Protection Regulation (GDPR<\/a><\/strong>) users were hardly ever notified about third-party cookies. Collecting user data was bread and butter for publishers and advertisers, who consequently received a negative response from people wanting to protect their privacy. Since GDPR demands that website owners notify users about the purpose of third-party cookies on their website<\/a>,<\/strong> people have become more aware of e-Privacy issues and subsequently want greater transparency from publishers. Some of the browser players have met such expectations and come up with solutions aimed at protecting users\u2019 data and not allowing publishers and advertisers to create a more personalized message based on the information gathered.<\/p>\n\n\n\n From mid-2017, leading browser\nproviders began adapting their products to what would be a challenging future.\nGiven the importance of tracking browser data, creating personalized\nadvertising had been the primary source of revenue for the majority of\nPublishers. Consequently, all new corrective features could only bring about a\ndecline in revenues.<\/p>\n\n\n\n When we look at the balance of power in the browser market (YB data, Q42018) at the end of 2018, there were 3 players: As Firefox is one of the most popular browsers which our Publishers are making recourse to, we have decided to take a closer look at ETP in order to assess how these new features may affect Firefox\u2019s revenue share and performance. For the period October-November 2019, we saw a significant drop in Firefox\u2019s revenue share of 5 percentage points (compared to Q4 2018 \u2013 Chart 1.). More importantly, we can see that Firefox\u2019s revenues were absorbed by Chrome (Safari’s shares have remained almost unchanged). In the context of such a disruption, Advertisers have transferred their budgets almost entirely to Chrome so as to not put their businesses at risk. Due to Firefox\u2019s privacy protection, Firefox has been unable to reach potential customers using the data that third-party cookies should collect. <\/p>\n\n\n\n However, has this change has\naffected Publishers? Let\u2019s look at this problem by analysing Publisher\nperformance from several major geo-locations based in Western and Central\nEurope before and after the implementation.<\/p>\n\n\n\n This change came into force at\nthe end of Q3 and was already in force throughout Q4. Due to the annual\nseasonality of this period, we could expect to see increase performance\neverywhere. However, the following data proves that Firefox experienced\ndifferent trajectories entirely.<\/p>\n\n\n\n If there had been no change,\nwe could have expected fairly similar results for Firefox, in line with other\nbrowsers. The selected countries did not report drastic changes in their\nperformance. In Poland and Germany, a decline in the daily average RPM after\nSeptember 3, 2019 could be discerned.\nThe following graphs clearly show that “something did change” in the\nperformance of Firefox, but that it was not a massive disruption.<\/p>\n\n\n\n Meanwhile, when we analyse the\ndaily RPM levels at the beginning of September, we see significant decreases in\nFirefox and almost immediate – somewhat unusual – increases in non-Firefox\ntraffic, regardless of localization.<\/p>\n\n\n\n Before the introduction of the new feature, Firefox and non-Firefox browsers remained stable. Whereas after the implementation of the ETP, Firefox continued to note a decrease in RPM levels. Since some advertising budgets moved from Firefox to other browsers, an increase in the performance of other browsers can be seen. We estimate that publishers in Poland could have experienced a decrease in revenues of around 1.3-2.0% related to the change implemented.<\/p>\n\n\n\n Similar trends have been\nobservable in Slovakia. The RPM result may have arisen from the fact that in\nSlovakia the Firefox\u2019s performance was always a little below the performance of\nnon-Firefox browsers. We estimate the overall decline at around 0.2%.<\/p>\n\n\n\n Firefox on the German market\nhad the largest revenue shares compared to Poland or Slovakia. Before the\nintroduction of the new feature, Firefox was very popular in Germany \u2013\naccounting for 28% of revenue.<\/p>\n\n\n\n In this case, the decrease in\nFirefox performance was substantial (average -6.5% per day). Firefox\u2019s\nperformance which before the change remained similar to non-Firefox browsers currently\nis gradually falling. We estimate that the decline in the total revenues of\nGerman Publishers could have suffered by about 7-8%.<\/p>\n\n\n\n Limiting third-party cookies involves long-term consequences across the marketing and advertising spheres but there\u2019s no need for unease. Programmatic advertisers need to find a solution that will enable them to target users with personalised ads, but also to ascertain whether ads will lead to sales. Even if publishers won\u2019t be able to <\/strong>monetize their website with Firefox<\/strong><\/a>, they can move their investment to other browsers, choose one of the existing solutions like IDify, or select marketing channels that don\u2019t rely on cookies.<\/p>\n\n\n\n Naturally, things might change\nwhen Google Chrome phases out third-party cookies in Chrome over the course of\nthe next two years. This event might be extremely disrupting for marketers and\npublishers who mainly depend on advertising. In the worst case, Publishers\nmight initially expect the decrease of global revenues – especially in the\nsituation where advertisers would no longer have a space to move campaigns in\nsearch of cookies. Being aware of this, currently Google is looking for\nsolutions that will support Advertisers\u2019 advertising activities of publishers\nand advertisers. We need to take into consideration that the majority of\nGoogle\u2019s revenue comes from digital ads, so a resolution can be expected.<\/p>\n\n\n\n
<\/p>\n\n\n\nBrowsers and Third-Party Cookies<\/strong><\/h2>\n\n\n\n
<\/p>\n\n\n\n
1. Google Chrome
2. Firefox
3. Safari
<\/p>\n\n\n\n<\/figure>\n\n\n\n
The undeniable market leader was Google Chrome with over 68% in total revenue shares. Almost 15% of traffic went to Mozilla Firefox and 7.7% to Safari (Apple).
Before looking at Firefox, let us consider its major competitors. Apple was the first to introduce changes in the tracking of cookies<\/strong><\/a>. But as we can see, ITP didn\u2019t translate into a noticeable drop in revenues. This was mainly due to the scale of Safari usage.
Undoubtedly, an unknown quantity for 2020, which carries a big revenue risk, is Google Chrome\u2019s new secure-by-default model for cookies that are going to be released in February. This new feature is set to limit the sending of third-party cookies in cross-site requests, except for those cookies that are secure or have been flagged by SameSite.<\/p>\n\n\n\n
<\/p>\n\n\n\nNo more Third-Party Cookies for Firefox – How the new feature is set to impact Publisher revenues <\/strong><\/h2>\n\n\n\n
<\/p>\n\n\n\n
<\/strong>Firefox has decided to make truly impactful changes<\/strong><\/a>. <\/strong>At the beginning of September 2019, the Enhanced Tracking Protection (ETP) mechanism was launched. It is a mechanism directed against external cookies that can be used to collect user data in order to build complex profiles (later used by advertisers). <\/p>\n\n\n\n<\/figure>\n\n\n\n<\/figure>\n\n\n\n<\/figure>\n\n\n\n<\/figure>\n\n\n\n
<\/p>\n\n\n\nInitial thoughts<\/strong><\/h2>\n\n\n\n
<\/p>\n\n\n\n