Marketing cookies are a hot topic right now. Google's announcement that they plan to phase out third-party cookies has led to a lot of debate and discussion over the future of marketing, with many predicting "the end of cookies."
But not all cookies are created equal. First and Third-party cookies operate differently and are therefore impacted differently by privacy laws and changes to Google Chrome. Here we'll take you through everything you need to know about the differences between the two types of cookies.
What is a marketing cookie?
A marketing cookie is any type of tracking technology used to collect analytics data while users browse the web. This can include first-party cookies, which are set by the website whose content you're viewing, and third-party cookies, which are set by other companies that track user behavior across different websites. Marketing cookies allow advertisers to collect information about user behavior, such as what sites you visit and how long you spend on each one. They are commonly used to target users with more relevant ads and measure ad performance.
First party cookies
First-party cookies are a type of web cookie that is created by the website itself in order to enhance the user's experience. These first-party cookies persist on the user's device until expiry or until they are deleted manually by the user. First-party cookies are used to store session information which means a site can recognize a user's computer and prefill that session info when the user visits again.
For instance, you browse an online store and add items to your basket. First-party cookies mean that when you return to the site - even if you don't have an account - the items you selected will still be in the basket.
The information that's contained in the cookie can be used by the website to provide tailored content based on users' preferences (like personalized product recommendations) or to optimize site performance through improved load times.
'Second-party cookies' is the term used for when an organization shares data from the first-party cookies on its site with another organization.
Third-party cookies are set by a domain that's different from the one being visited by the user. These third-party domains might be affiliated with the first-party host domain or may be completely separate from it. Third-party cookies can collect user data across different websites and track their online activity. This data can then be used for marketing and other purposes, such as targeting ads based on user interests.
Let's say you visit a website that has a banner ad for a product, and you click on the banner to visit the company's website. The company may load third-party cookies into your browser. Later, if you visit a different website, you may see an ad for the same product that you previously viewed because the third-party cookie allows the company to track and target their ads based on your previous browsing activity.
How a first-party cookie differs from a third-party cookie
First-party and third-party cookies differ in five key areas.
1) The owner and creator of the cookie
First-party cookies are directly sent from website owners, while third-party cookies are created by external organizations, including advertising networks, data brokers, and analytics services. Advertising networks use third-party cookies to collect user data across different websites and track their online activity in order to deliver targeted ads. Data brokers may combine first-party data with third-party data to create comprehensive profiles of users for marketing purposes. And analytics services use first-party cookies to track and report on user behavior across sites in order to provide insight into how users are engaging with content.
2) The purpose of the cookie
While first-party cookies are typically set with the intention of providing a better user experience, third-party cookies can be used for a wide range of purposes. Some common uses include targeted advertising, data collection and analysis, and website analytics. Targeted advertising involves collecting data about users through first- and third-party cookies and using that data to serve targeted ads based on users' interests, browsing histories, and other factors. Data collection and analysis can be used to create user profiles, track users across multiple websites and social media sites, or improve website functionality.
3) Where the cookie operates
Third-party cookies track users across multiple websites, while first-party cookies are typically used for tracking user activity within a single website or domain. For example, first-party cookies may be used to track items in an online shopping cart or users' activity on a social media site, while third-party cookies can track user engagement across multiple sites.
4) Browser support for the cookie
Users can choose to delete first-party cookies, but they're not usually blocked by browsers because they often help sites to function properly. However, browsers either block or make it easy for users to block third-party cookies. Google Chrome, for example, gives users the option to block third-party cookies or to block all cookies, but it recommends users don't block all cookies.
5) The implications for privacy laws and regulations
Privacy concerns surrounding third-party cookies are significant. Third-party cookies are used to track user activity across multiple websites and can potentially collect data about users without their knowledge or consent. This data is then used to create comprehensive user profiles for marketing purposes and target users with ads based on their online activities.
In order to address these issues and protect users' privacy, some countries and organizations have started to introduce stricter regulations surrounding cookies. For example, the EU's General Data Protection Regulation (GDPR) mandates that users must provide consent before their data can be collected via cookies. Google has also announced that it is phasing out third-party cookies, which means markers will no longer be able to do cross-site tracking in the same way.
Future proof your ecommerce store with first-party data
Customer data is fundamental for ecommerce brands because it allows them to understand and analyze the behavior, preferences, and needs of their customers. But changes to data privacy laws mean that any reliance on third-party data is a risk.
To survive in the future, commerce brands need to focus their efforts and attention on gathering first-party data. This first-party data can be collected through a variety of means, including first-party cookies, in your owned channels: your ecommerce platform, email software,SMS software, and analytics tools. With first-party data, you can create comprehensive customer profiles that allow you to personalize your marketing efforts and improve the user experience on your website.
Read more in our article Zero Party Data vs. First-Party Data: How to Use Them to Scale Your Ecommerce Brand.