THE CORE RECIPE

Understanding cookie basics.

What is a cookie?

Cookies are small text files that are stored on your computer's browser directory or program data subfolders.

They’re created when you use your browser to visit a website and they keep track of your movements on the site.

What’s the difference between first-party and third-party cookies?

First-party cookies are generated by the websites you visit, and they can remember your login details, preferences, browsing history, and so on.

Third-party cookies are created by domains that are not related to the website you are visiting. They are placed on a website through a script or tag and are used to identify and track users across multiple websites.

Ever since digital advertising began across the web, the third-party cookie has been the ‘currency’ that the vast majority of platforms rely on to do their job.

These functions include:

Targeting – identify and target small audience groups based on their web browser behaviour
Re-targeting – help companies reach users who don't make a purchase
Frequency capping – restrict the number of times a specific visitor to a website is shown a particular advertisement
Attribution mapping – helps determine which marketing channels lead to customer conversion
ID graphs – create platforms where the ‘unique identifiers’ that make up customer data are collected such as device IDs, email addresses, phone numbers, cookie data, transactions and so on.

As you can see the humble third-party cookie is a pretty powerful tool.

These tiny data packets are the lifeblood of demand-side platforms, supply-side platforms, and data management platforms, all of which are anchor links in the programmatic supply chain.

Statscounter Global Browser (July 2021)

Third-party cookies are already blocked by some browsers and are set to be blocked by Google Chrome next year (2023).

Death knell questions

Third-party cookies are on their way out which of course has seismically rippling implications.

• Data collection companies who sell information to advertisers have largely used third-party cookies to identify users and track their online activities.

• As third-party cookies slide into digital oblivion new methods to identify and target prospects need to be used.

We might look to outfits like Google Analytics for website analytics and reporting but…

• While they can continue to report on website traffic when third-party cookies go to the wall, important cross-session level data will be more difficult to collect.

• Data providers such as Google Analytics are updating their platforms to support first-party cookies, or ‘fill in’ missing data with Machine Learning that will no longer be collected by third-party cookies.

• Data is simply data without the magic of slice and dice analysis and reporting. It’s not known to what extent reporting is going to be affected which leaves a question mark over the efficacy of these platform when they are updated.