The discussion around third-party cookies has evolved since Google announced its plan to phase them out. Initially, this created a ripple effect across the digital marketing industry, pushing many to explore first-party data as a preferable alternative.
First-party data, collected directly from users through interactions on a website, is touted for its reliability and privacy compliance. However, it’s important to remember why third-party cookies were developed in the first place.
Third-party cookies were created for cross-site tracking, which allows advertisers and marketers to build a comprehensive profile of a user’s online behavior across various websites.
Cross-site tracking is invaluable for targeted advertising, optimizing ad spend, and improved user experience. Despite their declining reliability due to increasing privacy regulations and browser restrictions, third-party cookies still offer unique advantages that should not be overlooked.
Third-party cookies provide insights that are difficult to obtain through first-party data alone, making them a useful tool for advertisers seeking to understand user behavior on a broader scale.
How cookies actually work and why they matter
A cookie is a small text file that websites store on a user’s computer. It contains a unique identifier that helps websites recognize returning visitors. This unique ID is associated with the user’s browser, such as Chrome or Safari, allowing the website to remember the user’s preferences and actions over time.
Cookies are key for maintaining stateful interactions on the web. The internet was originally designed as a stateless environment, meaning that each page request is treated as an independent, anonymous event.
Without cookies, websites cannot identify if a visitor is new or returning, making personalized user experiences, such as maintaining login sessions, impossible. When storing a unique ID in a cookie, websites can persistently identify users across multiple visits, supporting features like personalized content, user authentication, and targeted advertising.
Cookies play a key role in the functionality of many popular websites. For instance, Amazon uses cookies to keep users logged in and remember their shopping carts across sessions. This is key for improving user experience and reducing friction in the purchasing process.
Similarly, Gmail uses cookies to maintain user sessions, allowing users to remain logged in across multiple visits. If these cookies are deleted, users would need to log in again, highlighting the importance of cookies for user interactions.
First-party vs. third-party cookies, what’s the difference and why it matters
There is a common misconception that all companies have extensive tracking capabilities akin to those of Google or Facebook. While these tech giants can track users extensively across the web using third-party cookies, most companies do not have this level of access or capability.
Without third-party cookies, individual companies are largely limited to tracking user behavior within their own domains. As a result, they cannot easily gather comprehensive data on users’ activities across multiple sites, making it difficult to build a complete picture of their online behavior.
The basics of first-party cookies
First-party cookies are created and stored by the website a user is currently visiting. These cookies are only accessible to the domain that created them, allowing the website to remember user preferences and provide a personalized experience.
For example, when a user visits nationalgeographic.com, a first-party cookie is created that can only be read by National Geographic’s servers. This cookie helps the website track user behavior within its domain, supporting features like remembering a user’s language preference or maintaining a logged-in state.
The power of third-party cookies
Third-party cookies are different in that they are created by domains other than the one the user is currently visiting. These cookies are commonly used by advertising networks like Doubleclick to track user behavior across multiple websites.
If a user visits nationalgeographic.com, a third-party cookie from Doubleclick might be set. This cookie can then track the user as they browse other sites that use Doubleclick for ads. When aggregating data from multiple sites, third-party cookies help create detailed user profiles, which can be used for targeted advertising and personalized marketing campaigns.
The limits of first-party cookies
First-party cookies are limited to the domain that sets them, which means they cannot track user behavior across different websites. This poses a significant challenge for companies that operate multiple domains.
ACME Dog Food Company might own several websites to promote its products. Each site can track user behavior individually, but without a common identifier, ACME cannot link a user’s activity across these sites. Siloed data limits the company’s ability to gain a holistic view of its customers’ behavior and preferences.
Consider the case of ACME Dog Food Company, which owns two separate websites. Without a common identifier, such as an email address collected during a purchase, the IT manager cannot connect user data across these sites.
A disconnect makes it challenging to understand how users interact with the brand across different platforms and hinders efforts to deliver a consistent and personalized experience.
How to merge user data across multiple sites without third-party cookies
To overcome the limitations of first-party cookies, companies can employ several strategies to merge user data across multiple sites:
- Site registration: Encouraging users to register with the same email or username across different sites means companies can establish a common data point to link user behavior.
- Browser fingerprinting: This technique involves collecting information about a user’s browser, such as IP address, screen resolution, and browser type, to infer if the same user is visiting multiple sites. While not foolproof, browser fingerprinting can provide valuable insights in some cases.
- Third-party tools: Tools like Google Analytics can sometimes help match users across sites by using identifiers such as the Google Analytics ID. This approach leverages third-party data to bridge gaps between different domains.
- Linking via unique IDs: When linking between two sites, companies can pass a unique identifier as a query parameter in the URL. This ID can then be used to match users across sites, but it only works for users who click on those specific links.
Reconsidering third-party cookies
Some companies, like ACME Dog Food Company, might consider creating their own third-party cookies to track users across all their websites. When setting a unique ID for each visitor, this approach allows the company to merge user data across multiple domains.
A unified tracking method can provide a more comprehensive view of user behavior and enhance marketing efforts. However, it’s important to note that this strategy has its limitations and challenges.
The hard truth about third-party cookies
There are obstacles to using third-party cookies in a privacy-conscious environment. Not all browsers support third-party cookies, and many users actively opt out of them. As a result, the effectiveness of third-party cookies is estimated to be limited to about 50% of users due to these browser restrictions and privacy settings.
Companies need to weigh these limitations against the potential benefits when deciding whether to implement third-party cookies.
The future of cookies in digital marketing
Despite the growing constraints on their use, third-party cookies still provide valuable data for cross-site tracking and targeted advertising. When combined with other data collection methods, they offer unique insights that are difficult to achieve with first-party cookies alone.
For businesses that rely on a comprehensive understanding of user behavior across multiple sites, third-party cookies remain a relevant tool in the digital marketing toolkit.
While the effectiveness of third-party cookies is diminishing, they can still play a role when used in conjunction with other data strategies. When combining third-party cookies with first-party data and alternative tracking methods, companies can develop a more comprehensive and holistic approach to understanding and engaging their customers.
