Online privacy has become vastly more important in recent years and some of the biggest developments are the upcoming changes to how cookies work. Here’s a complete guide to first-party and third-party cookies, including what you can do now to prepare your brand for the changes.
What are they?
First off, we should mention second-party cookies. These aren’t spoken about much as they aren’t commonly used – they involve the transfer of data between multiple companies.
First-party cookies are those created and stored by a website to help improve the customer experience. They allow the site to remember preferences such as passwords or language, and to keep items in shopping baskets until they’re ready to be purchased. These are supported by all browsers and can be blocked or deleted by the consumer.
Third-party cookies, however, come from outside domains. They are placed on a site through a script or tag and are largely used to observe consumer behaviour and deliver ads, as well as collecting data on how these ads are engaged with to see how effective they are. Visitors have to be informed about these cookies, whereas first-party cookies are accepted automatically.
Currently, third-party cookies are supported by browsers, but some, such as Mozilla and Safari, are starting to block them over privacy concerns. Most importantly, Google’s Chrome browser (which has the largest market share) is set to phase them out in 2022.
What does this mean for the future of online advertising?
First-party cookies will be unaffected by these changes, but the changes to third-party cookies will have major impacts on the online advertising industry. Google has said it doesn’t intend to destroy this sector but it’s clear major changes are on the horizon. Indeed, in 2019, Google said the intention is for marketing to work by using less user data.
However, advertisers should start considering alternative solutions, such as relying more on their own first-party data and working with partners who can help them best utilise this method. This could include publishers, who have direct relationships with their site visitors or data management firms who can create better tools to work with first-party cookies. There’s also the older technique of contextual advertising, where ads are placed on sites that rank well for relevant keywords.
Importantly, consumers have been shown to be more open to sharing data if they have clear and simple control over how and when it is used. Convincing people to give their consent for targeted ads could lead to other avenues for online marketing.
These changes look set to dramatically change the online advertising landscape with many positives for consumer privacy. It’s clear that the future of marketing requires diversifying and coming up with improved alternatives to third-party cookies, such as email campaigns, mobile wallets and more specialised techniques.