Cookies have been used since the early days of the internet to track website visitors and collect analytics data for ad targeting. They’ve not only helped marketers analyze user behavior, but have also played a crucial role in making online browsing a seamless and hassle-free experience.
However, increasing user awareness about data privacy has brought the role cookies under intense scrutiny.
This, in turn, has resulted in Google taking significant steps to phase out third-party cookies in its Chrome browser. As part of its Privacy Sandbox initiative, Google began testing Tracking Protection in December 2023, which restricts website access to third-party cookies by default.
This testing marks a key milestone towards the complete phase-out of third-party cookies for all Chrome users by the second half of 2024, subject to regulatory considerations.
This move signifies a major shift in how user privacy is managed on the web, with Google taking a responsible approach to transitioning away from third-party cookies while ensuring that essential web functionalities and business needs are addressed.
How will these changes affect publishers and marketers and their advertising strategies as we move into a third-party cookie-less world?
This article examines the difference between first-party and third-party cookies and how website owners can pivot to prepare for the impending phase-out.
Table of contents:
What Are Cookies?
Cookies allow website owners to identify and track online users. Cookies are of two types—first party, and third party. The term second-party cookie is also sometimes used to refer to a certain type of data exchange between two parties, however these are not technically cookies.
What Is a First-Party Cookie?
First-party cookies are created by the host domain, which is to say, the domain which the user is visiting. They enable the browser to store key pieces of user information, allowing it to remember language preferences, user names, and passwords. This in turn provides a better UX to the visitor.
First-party cookies also communicate user data with e-commerce sites, allowing them to store items users have put in their shopping carts as well as their browsing history.
First-party cookies are essentially how websites such as Amazon remember our login details and shopping history so that we don’t have to enter this information each time we visit the website.
First-Party Cookies Examples
First-party cookies can be of several types. Below are a few examples:
User Authentication Cookies
These cookies are essential for identifying and authenticating users on a website. When you log into a site, these cookies remember your login credentials, ensuring you stay logged in as you navigate different pages.
Language Preference Cookies
Many websites offer content in multiple languages. First-party cookies store your language preferences, so the site automatically presents content in your chosen language during subsequent visits.
Session Management Cookies
These cookies are crucial for maintaining a seamless user session. They keep track of your actions on a site during a single session, ensuring that any information you enter or changes you make are remembered as you move from page to page.
These cookies remember your settings and preferences, like layout choices, color themes, or font sizes, to provide a more personalized and convenient browsing experience.
First-party analytics cookies gather data about your interaction with the website, such as which pages you visit most often and how much time you spend on them. This information helps website owners understand user behavior and improve the site's functionality and content.
E-commerce Shopping Cart Cookies
These cookies are vital for ecommerce. They keep track of items you've added to your shopping cart, ensuring that your selections are remembered as you continue shopping or if you leave the site and return later.
Form Data Storage Cookies
These cookies store the information you've entered when you fill out forms on websites.This is particularly useful for long or multi-page forms, as it prevents data loss if the session is interrupted.
Content Recommendation Cookies
Similar to personalization cookies, these track browsing habits and preferences to suggest relevant content, products, or services that align with your interests.
These cookies help enhance the security of a website. They detect and prevent threats like unauthorized logins and protect user data from unauthorized access.
For users with accessibility needs, these cookies store preferences like high-contrast modes or text-to-speech settings, ensuring the site remains accessible and user-friendly on each visit.
While first-party cookies are generally beneficial for enhancing user experience, it's important to use them responsibly and transparently, respecting user privacy and adhering to relevant data protection laws.
What Is a Third-Party Cookie?
Third-party cookies are cookies placed on a user's device by an entity or a company other than the one whose website the user is visiting. These companies are known as third-party associate sites.
Third-party cookies are predominantly used for collecting data and tracking users for online advertising purposes.
They also allow sites to provide certain services, such as live chats.
The third-party cookie is the cookie that is at the center of the debate surrounding cookies and consumer privacy.
Third-party cookies are commonly used for the following purposes:
Cross-site tracking is the process of collecting browsing data from several sources, detailing user activity.
Retargeting uses previous search information from different websites, detailing products and services for which a user has shown interest to retarget visitors with ads.
Third-party cookies are also used to deliver personalized and relevant ads. Advertisers use them to make decisions about serving ads; which ads will appear, and when. They then collect data, such as clicks and impressions, to inform future marketing strategies.
Third-Party Cookies Examples
Third-party cookies are of several types, such as:
Behavioral Advertising Cookies
These cookies track user behavior across various websites to build a profile of interests, which is then used to display personalized advertisements.
Cross-Site Tracking Cookies
These cookies follow users as they visit different websites, collecting data on their browsing habits and preferences. This information is often used for targeted advertising or market research.
Social Media Integration Cookies
When websites include social media sharing buttons (such as Facebook's "Like" or Twitter's "Tweet" button), these cookies track users both on and off the site for various purposes, including advertising and analytics.
Affiliate Marketing Cookies
These cookies track referrals from one website to another. For instance, if a user clicks on an affiliate link, a cookie is placed to track if a purchase is made, attributing the sale to the referring website.
Customer Profiling Cookies
Used by data aggregation companies, these cookies collect data about users' online activities to create detailed profiles, which are then sold to other businesses for targeted marketing.
These cookies remember products or services users have looked at on one site to display ads for them on another site. They are widely used in e-commerce to re-engage with potential customers.
Analytics and Research Cookies
Different from first-party analytics cookies, these third-party cookies gather data for external analytics services, providing insights into user behavior across multiple sites.
Content Personalization Cookies
These cookies are used by content recommendation platforms to suggest relevant articles, videos, or other media based on the user's browsing history across different websites.
Ad Exchange Cookies
Used in programmatic advertising, these cookies help in the real-time bidding process on ad exchanges, where advertisers bid for ad space on websites based on user data.
Fraud Prevention and Security Cookies
Some third-party cookies are used to detect and prevent fraudulent activities and ensure the security of online transactions.
It's important to note that while third-party cookies play a significant role in online advertising and analytics, they are often viewed critically due to privacy concerns. With increasing regulations and browser restrictions, the use of third-party cookies is evolving, with a shift towards more privacy-focused alternative
What about Second Party Cookies?
Second-party cookies, though rarely discussed, also play a role in online data collection. Second-party cookies are cookies that transfer first-party data from one company (the company that created the first-party cookie) to a second party via a data partnership.
It is becoming an increasingly popular practice in programmatic advertising for large companies to share their first-party data with other websites in another industry that have overlapping customer types.
Second-party cookies are the conduit here, and they are used to increase conversion rates and influence more efficient ad spend.
Key Differences Between First-Party and Third-Party Cookies
While first-party and third-party cookies are the same file type, there are a few key differences in how they operate. The three main differences are as follows.
Setting the Cookie
In contrast, third-party cookies are placed on a website through a third-party server, typically an advertising technology (Ad-Tech) server, using code embedded in the website
Availability of the Cookie
When it comes to first-party cookies, only the domain that created them can access and track them. However, third-party cookies are accessible to any website that loads the third-party server's code.
Browser Support, Blocking, and Deletion
All browsers support first-party cookies. And while they can be turned off, it often leads to poor UX and the appearance of a ‘broken' website. While all browsers also support third-party cookies, many have now made it a default setting to block them.
Third-Party Services That Leave Cookies
Several third-party service providers leave third-party cookies in the user's browser. Here are the main culprits:
Ad retargeting is a marketing strategy that involves tracking third-party data of the products and services a user has previously interacted with and then showing them ads for said products. Retargeting is used across several channels, including social media, display advertising, and email marketing.
Many social media plugins use third-party cookies. These enable users to log in, as well as like and share content on third-party sites.
The social media sites where these third-party cookies originate can then track the sites a user visits. This data is then used to serve relevant ads when they return to the social site. Privacy can be a genuine concern with this type of third-party cookie, as these cookies can still identify users even if they are not logged in. They do this by identifying a user's cookies, deterministic matching, and, in some cases, even fingerprinting' a user's device.
When it comes to cookies, live chat pop-ups operate in a very similar way to social buttons. Because the chatbox can identify the user via the third-party cookie, it is able to remember the user's details and conversation history. This data will be removed when the user deletes their cookies.
Third-Party Cookie Phase-Out
In an increasingly digitally-savvy world, user privacy has become a contentious issue. Users are demanding greater privacy, transparency, and control over how their data is used.
This demand led Google to initiate the testing of Tracking Protection in Chrome, a significant step in their Privacy Sandbox initiative, with the aim to phase out third-party cookies for all users in the second half of 2024, subject to addressing any remaining competition concerns from the UK’s Competition and Markets Authority.
While discussions for Privacy Sandbox are still in their infancy, Google has announced that the tool will enable marketers to continue to serve ads with a reduced amount of data.
While the death of third-party cookies may come as a surprise to publishers, it has been a long time in the making.
Governments worldwide have been making recent policy changes in the wake of investigating privacy concerns.
In October 2019, Europe's highest court ruled that website users in the EU must now actively consent to the use of all analytics cookies when they log on to a website. This ruling means that sites in the EU must gain explicit opt-in consent from users before they can load third-party cookies onto the user's browser.
Publishers, advertisers, and agencies will need to pivot their marketing strategies, employing alternative tools to continue to deliver personalized advertising. By exploring how to leverage first-party and transactional data, publishers can continue to monetize their sites successfully.
For publishers who still rely on third-party cookies to inform their monetization efforts, Publift can help. We have years of experience utilizing first-party strategies to deliver personalized, relevant ads, and we can help you move successfully into the third-party cookie-free world.
If you're making more than $2,000 in monthly ad revenue, contact us today to learn more about how Publift can help increase your ad revenue and best optimize the ad space available on your website or app.
Did Google Ban Third-Party Cookies?
No, Google has not banned third-party cookies. Instead, Google has initiated a phased approach to phase them out. As part of its Privacy Sandbox initiative, Google began testing Tracking Protection in Chrome, which restricts access to third-party cookies. The plan is to completely phase out third-party cookies for all Chrome users by the second half of 2024, depending on the resolution of competition concerns raised by the UK’s Competition and Markets Authority.
What Is Replacing Third-Party Cookies?
Google is developing new technologies as part of its Privacy Sandbox initiative to replace third-party cookies. These technologies aim to provide more privacy-preserving mechanisms for online advertising and tracking. One of the key proposals is using aggregated, anonymized data to track user behavior without compromising individual privacy. This includes techniques like Federated Learning of Cohorts (FLoC) and other methods allowing ad targeting and measurement without letting advertisers access individual user data directly.
Will Cookies Be Removed?
First-party cookies, set by the website a user is visiting, are not being removed and will continue to function as they currently do. These cookies are essential for various website functionalities, such as user authentication and personalization.
However, due to privacy concerns, third-party cookies set by domains other than the one being visited are phased out by major browsers, including Google Chrome. The timeline for this phase-out varies by browser, but for Chrome, the complete phase-out is expected by the second half of 2024.