What Are Cookies and Why Do They Matter For Advertising?

Warning: This post may venture into the tech weeds, but it should bring to light some of the details behind the scenes of online advertising — specifically, what advertisers are looking for when purchasing your inventory, and how publishers benefit from it.

What Are Cookies?

Everyone has heard of cookies, especially in recent years as Internet data collection has become something of a controversial topic. But while “cookie” is a universally recognized term, cookies are often misunderstood or not understood at all.

Cookies are essentially small text files stored on a user’s computer, designed to collect and retain a modest amount of data specific to a particular advertiser and/or website.

Still with us so far?

In practical terms, cookies are the reason you continue to get ads for the pair of shoes you browsed for online, or that nice new toilet seat you just purchased.

Dear Amazon, I bought a toilet seat because I needed one. Necessity, not desire. I do not collect them. I am not a toilet seat addict. No matter how temptingly you email me, I’m not going to think, oh go on then, just one more toilet seat, I’ll treat myself.

— Jac Rayner (@GirlFromBlupo) April 6, 2018

Cookies can live on your computer from a few weeks to a few years. While some recent news coverage may paint this as sinister, this practice has been common since the dawn of the Internet, and is crucial to increasing publishers’ RPMs over time. Typically, cookies last about 30 days for advertisers before they automatically delete themselves. The highest value for a cookie is generally as close to the visit or behavior that triggered the cookie and loses value the further you get from that activity date.

Advertisers want to show ads to specific users or users exhibiting specific behaviors. A user who visited DIY bathroom remodel sites in the last few days, for example, is likely worth 10 times what advertisers of such services and products would pay to reach unknown users.

The more specific cookies are when determining behavior, the stronger the return. Take a person who visited a big box electronics store and put an expensive TV in their cart, but never purchased it. They could be worth bids 100 times higher than unknown users. The value decreases the further away from the date the TV was put in the cart.

If you watch your RPMs daily or weekly, you will likely observe increases around all major holidays, throughout the fourth quarter of the year and anytime consumer spending spikes online – with cookies the driving force behind those RPM spikes.

There are limitations to cookies, because you’re not actually being spied on. The data they collect is still anonymous and aggregated, and as such, they can be unreliable. Cookies also face various technological limitations that hinder their effectiveness.

They often fail to follow the same person from a computer to a phone or a tablet. A cookie also can’t tell if it’s you, your child or your friend using those devices.

Data points are more difficult to capture on mobile devices, which mean lower CPMs on phones compared to desktop. And that’s all before taking into account the corporate and political pressures involved.

Last year, Apple restricted the use of cookies, resulting in a decrease in both the number of bids and the amounts of those bids we saw from Apple browsers. Most of you remember the chaos of GDPR this year, which dramatically changed cookie usage in the EU.

What Can You Do to Improve the Effectiveness of Cookies, and Your Users?

Diversify. Much of this process is out of our hands as publishers, but not all of it. The easiest and best way to get the most out of your users is not to put all your eggs in one basket. Don’t rely on just one social media platform, or one app store. Don’t quit on SEO. Differing strategies impact RPMs in different ways, so keep experimenting, spreading your efforts around and seeing what works.

Change up your content. More is more when it comes to content, and while it’s important to know your audience and your niche(s), considering broadening your content approach to grow your user base as well. If you’re a food site and happen to travel, for example? Travel advertisers spend aggressively for relevant ads, so posting about your trip could pay dividends. If you are a parenting blog but are remodeling your bathroom, or buying a new car for the growing family, tell us why and talk to us about these processes. This will widen your pool of users — and cookies — which will help you adapt to any changes in buyer behavior.

Stay up to date. Keeping an eye on Mediavine updates, making sure your Ads.txt page is updated regularly, and beta testing products like the Mediavine Create plugin all keep you ahead of the curve in a constantly-evolving landscape.

What is Mediavine Doing to Help?

Mediavine is always building relationships with advertisers, social platforms, and ad tech partners who specialize in targeting cookies, ensuring that we are an ideal partner to fit their needs and are prepared for whatever is coming next.

What’s coming next is the million-dollar question, but we are determined to be part of the conversation, joining and investigating groups who are brainstorming and leading the way toward a post-cookie world.

For example, there are several groups working on strategies to link users to multiple devices and browsers without cookies. Mediavine will be in position to test these products and other solutions, ensuring their effectiveness without invasiveness.

Finally, our development team will be creating products to give advertisers new options to reach users they are looking for outside of, or in addition to cookies. The Mediavine Create plugin will be the first such solution.

We are always working on improving the ad experience to make our publisher partners’ ads as valuable as possible to our clients, while improving viewability, site speed and video performance. #yearofvideo

We would also like to state for the record that all publishers should update their Privacy Policy immediately to explicitly state that dark chocolate chunk M&Ms are the absolute best cookies.

Just kidding. (They are though.)