Cookies are Crumbling: What Marketers Need to Know about First and Third-Party Data
As of January 2024, Google began phasing out support for third-party cookies. Since other major web browsers such as Mozilla Firefox, and Apple Safari are also dropping support for third-party cookies, this is a significant change in the digital landscape. This shift is particularly impactful because there are different types of cookies and they have been an important part of online marketing for almost 30 years, so this change is causing some confusion and concerns with marketers. What do agencies, marketers, and consumers need to know?
Types of Cookies
Cookies are pieces of data, typically text files, that get placed on a website visitor’s computer or mobile device and are used by websites to remember stateful information or to record browsing activity. Some cookies perform different functions; provide basic website functionality, monitor site performance, personalization, and tracking behavior for better advertising or browsing experiences.
Differentiators and Types
Regardless of the type of function the cookie is being used for, there are a couple of aspects that differentiate how they behave.
Session cookies are only stored temporarily and are deleted when the browser is closed. These cookies are used to remember data used while you are using a website, like keeping track of items added to your cart so you can continue shopping until you are ready to check out.
First-party and third-party cookies are stored on your device for longer periods and track user behavior. They have similar purposes but differ in how they are collected and how and where they are used.
The differences between first and third-party cookies are where most confusion comes in.
Understanding these differences is very important since the new changes only apply to Third-Party cookies.
First-Party vs Third-Party Cookies
First-Party Cookies
First-party cookies are created, stored, and used by the website or domain that you visit. These cookies are typically used to collect analytics data and recognize users and their preferences. This allows websites to remember things like language settings, login credentials, or other useful functions that provide a better user experience. For example, first-party cookies would allow a website to remember items added to your shopping cart even if you closed your browser without completing the purchase and then came back to the site days later.
Third-Party Cookies
Third-party cookies are created, stored, and used by websites or domains other than the one you are visiting – like a third-party advertiser using code or scripts added to the visited site/domain. These cookies are typically used to provide targeted advertising. Since these cookies are accessible by any website with access to the third-party server, they can be used to track user behavior across multiple websites over time.
If the website in our online shopping example uses third-party cookies, then information on what items you viewed or bought would be available to the third-party advertiser. You will then start seeing ads related to those items or similar vendor products appearing on other websites, including sites you have never visited.
To recap, the main differences between first-party and third-party cookies are:
- Who sets the cookie: A first-party cookie is set by the website that a user is visiting. A third-party cookie can be set by a third party through code added on the visited website.
- Who can access the cookie information: First-party cookies are available to the website or domain that created it. A third-party cookie is available to any website with access to the third-party server.
- What cookies are being phased out: Third-party cookies will no longer be available by the end of 2024. ActiveDEMAND does not use third-party cookies.
First-Party vs Third-Party Data
Related to the topic of first and third-party cookies is first and third-party data, and much like cookies these terms are about where data comes from and how it is attained by marketers.
- First-party data is collected from an audience directly, via a marketer’s channels. This includes first-party cookie information, as well as information gathered from web form submissions, social media, web chat, phone calls, and other direct interactions.
- Third-party data is collected by another entity that is entirely separate from the marketer’s channels. It may be sourced from external providers like aggregators or data brokers, who collect information from various sources including data based on third-party cookies. This information is typically broader in scope, encompassing a wider range of demographics and behaviors
The main differences between the two lie in their origin, accuracy, and relevance. Organizations should leverage both data types to better understand customer behavior and refine marketing approaches.
What Does All This Mean for Marketers?
The decision to end third-party cookies is mainly the result of increasing customer awareness of the amount of data companies are collecting and how it is being used and are now demanding to have more control and choice over their online privacy.
Ending support of third-party cookies will mean a decline in the quantity, quality, and availability of browsing data that advertisers and other marketers have come to rely on. In response to this new trend, marketers are putting more emphasis on First-Party data sources, marketing platforms, and Customer Data Platforms (CDP).
Join the First-Party Data side. We still have Cookies.
First-party data is very important in gauging customer intent and where they are in their buyer’s journey. By identifying what your audiences are interested in, you can personalize their experiences by suggesting products, services, and content your customers want to see.
Prospects engage with your brand across multiple channels and multiple devices so it’s important to maintain visibility into the channels driving results and the ones that need adjustments. Because first-party data is collected from a range of sources, marketers can get a wide variety of information and insight into their marketing performance.
For companies who currently rely heavily on cookie-based third-party data, or those struggling to synchronize multiple databases, another big advantage to using a marketing customer data platform is the ease and speed at which campaigns can be aligned across multiple channels. Other advantages of a marketing CDP system include:
- A smarter segmentation process and advanced personalization capabilities that allow marketers to provide more targeted personalization, targeting, and account-based focus.
- The ability to harness your marketing data to inform targeted list-based advertising campaigns on paid media channels
- A full life cycle view of each prospect from first touch through to won deal based on an accurate data mix of website, behavioral, social, sales CRM, and transactional data.
ActiveDEMAND is a Marketing Customer Data Platform
Many marketers are familiar with the long list of marketing automation capabilities ActiveDEMAND provides; anonymous visitor tracking, social media, web forms, landing pages, email and content marketing, appointment scheduling, dynamic content, call tracking, and extensive reporting. These marketing automation features are most effective when powered by real-time access to accurate first-party data.
ActiveDEMAND has recently added a suite of Data Services features that augment its already powerful anonymous and first-party data tracking capabilities, buyer’s journey tracking, and native CRM integrations. The suite of data services includes:
- Reveal: An identity resolution service to remove the anonymity of website visitors even if they do not perform any type of conversion action.
- Qualify: A data appending service that adds demographic information to a given contact record.
- Hygiene: A data validation service that ensures the quality and accuracy of your data stays up to date.
The impact of depreciating third-party cookies means marketers will become increasingly reliant on rich, accurate first-party data sources and marketing CDP systems like ActiveDEMAND that not only have multiple input channels beyond cookie-based data but also have all the tools needed to harness that data for the personalized, targeted marketing experience that consumers still demand.
Sign up for a FREE demo of ActiveDEMAND our marketing Customer Data Platform and see how you can excel in a world without third-party cookies. Discover innovative ways to leverage first-party data and personalize your marketing like never before. Book your free demo today.
