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A Primer on Cookies (and No, Not the Chocolate Chip Variety)

April 2, 2021 | By: Amber Breeden | Tags: ,

If you’re in marketing (and likely even if you’re not), you’ve probably seen a story or two over the last month about the impending death of third-party cookies. (Dun Dun Duuunnn!) Sounds scary, right? But what does it actually mean?

In a recent article about the future of data in marketing, our CEO, Jon, jokingly said, “If you asked me a year ago for my cookie policy, I would have replied ‘eat them.’ I love a good cookie.” He’s not alone. Unless you’re deeply entrenched in your digital marketing, it’s likely you have only a vague understanding of cookies and may not know the difference between third-party, first-party and so on. 

But as Jon notes, the pendulum is swinging toward consumer privacy, and this shift presents an opportunity for you, as a marketer, to rethink your customer data and how you acquire and use it. The future is first-party—this is the customer data your company already owns, and you probably have more of it than you realize. But before we dive into how to make the most of this data in your marketing, it helps to understand the different types of data and how consumer privacy laws are changing data usage.

First-party Cookies 

First-party cookies are the small amounts of data that your company website creates and stores on a user’s computer when they visit your site. This is information about your customers’ behavior on your website that goes directly to you, so it’s the safest, highest quality data you have. All browsers allow first-party cookies; these cookies allow your website to collect analytics data, track language settings, and perform the necessary functions for a good user experience. Without first-party cookies, your online experience would get frustrating fast.

Amazon is a great example. When you first sign into your Amazon account, your browser saves that information under the “amazon.com” domain. Without first-party cookies, you would have to sign back in every time you visited the site. Even more annoying, your shopping cart would reset after each item you add, making it impossible to purchase multiple items at once. 

Third-party Cookies 

Unlike first-party cookies, third-party cookies are small amounts of data created by a domain other than your own website. If a company is running digital ads that are referring back to their website, that’s a third-party cookie. If you visit a site with advertisements, chances are there are third-party cookies. If a live chat feature is supported by an outside service, that’s a third-party cookie. You get the idea. Over time, your web usage data can tell a story about you, your life, and your interests, which advertisers can then use to target you with relevant ads. 

To go back to the Amazon example, you might look at a few different items and visit each of the individual product pages. You decide to purchase one of the items, but suddenly you’re seeing ads on other websites and receiving emails about the items you didn’t buy. That’s third-party cookies in action. 

Second-party Cookies 

Second-party cookies, or second-party data as it is more often described, is a bit murkier to define. This data is essentially first-party cookies from another website that are shared with you as part of a defined partnership or collaboration. While second-party purchased data has been around for years, it’s starting to gain more traction as companies look for other ways of targeting customers without using third-party cookies.

 

Data privacy laws like the EU’s General Data Protection Regulation (GDPR), the California Consumer Privacy Act (CCPA), and the Consumer Data Protection Act (CDPA)—the most recent privacy law passed in our home state of Virginia—as well as several others in the works, will eliminate third-party cookies and, with them, a whole host of tactics marketers have come to rely on, retargeting and display advertising chief among them. 

But don’t despair—the marketing industry has been around since the Industrial Revolution, and it has been evolving exponentially ever since and will continue to adapt. It’s time to get creative and do the work to understand your clients. In a future post, we’ll talk about different ways you can collect first-party data and how you can better use it to your advantage.