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What does the future look like for Third-Party Cookies?



Even though it seems like we can visit different websites without interacting with anyone or anything, it’s fair to say that nothing online is available for free.

Whether you’re researching customer data platforms or looking for the latest funny cat video, third-party cookies are part of that process. Publishers give you content, advertisers agree to fund that information, and Internet users agree to provide personal data to hundreds of companies through third-party cookies.


That’s how the free web publishing structures have helped the Internet grow since the 1990s. For over 25 years, those cookies provided crucial identifiers that track user movements online. They allow advertisers to target ads and measure their effectiveness.


Third-party cookies are a central technology that underpins the entire marketing concept. They are often used by advertisers and social networks to monitor user activity online and for behavioral targeting. A third-party cookie is a cookie that is placed on a user's hard disk by a website from a domain other than the one a user is visiting. A third-party cookie is placed on a website by someone other than the owner (a third party) and collects user data for the third party. As with standard cookies, third-party cookies are placed so that a site can remember something about the user later. Third-party cookies are often set by advertising networks that a site may subscribe to drive up sales or page hits. Third-party cookies work by embedding JavaScript from one website into another.



Google Was Going to End Third-Party Cookies in 2022


Firefox and Safari already block third-party cookies by default. This feature protects user privacy on two of the top three browsers that people use.


Google Chrome controls nearly 70% of the global browser market. Its parent company initially announced that it would also stop using third-party cookies by 2022. That timeframe has been extended to the end of 2023.


Although this tracking technology is getting stopped by default, it is a setting that consumers can change. It’s not necessarily the end of tracking, but changes are coming. Third-party cookies, and cookies in general, pose a significant data security risk and are viewed by some as infringing on user privacy rights. Therefore all the main browsers now block third-party cookies by default. In 2011, the European Union passed the cookie law that required users to be informed of the cookies they'd be interacting with upon visiting a site.


Data is the greatest asset for all businesses today. Without it, knowing what customers want or need becomes a guessing game. The benefits of third-party cookies show that this problem is easily solved. Websites have become more focused on asking you to accept cookies. The reason reflects a data privacy protection law that governs online data tracking and transparency. The European General Data Protection Regulation (GDPR) became law in May 2018.



What Are the Benefits of Third-Party Cookies?


Although there is a general distaste for third-party cookies from consumers, they are crucial for digital marketers. Their convenience is a significant factor in that perspective. A single cookie that follows Internet users allows for better service.


Imagine being exposed to thousands of random brand messages each day. Third-party cookies provide targeted information based on a user’s activities. Websites even use cookies to get location data to provide the most relevant information.


Third-party cookies offer personalization, which is a top factor that consumers say they want when working with today’s brands. A website can suggest related products based on individual interests, delivering a custom marketing outcome that wouldn’t be possible without data collection.


People love to see different suggestions when purchasing items. Third-party cookies are the reason why that option is possible.


It’s not helpful for customers or businesses to have advertising that has nothing to do with an individual’s desires, needs, or wants. It wastes marketing funds and the prospect’s time.


Third-party cookies ensure that what a person sees is likely relevant to their goals or needs. Most consumers agree that they’d rather see relevant advertising, but the only thing that holds back an enthusiastic response is data privacy concerns.



How Can Third-Party Cookies Evolve?


With data privacy requirements likely expanding in the future to ensure transparency, some alternatives could help marketers maintain some of the benefits that third-party cookies offer.


Google already announced trials for its FLoC methodology, which stands for “Federated Learning of Cohorts.” Instead of tracking individuals, it categories users into groups of at least 1,000 based on preferences.


If a business wants to target someone interested in its products or services, a marketing team can decide to serve advertising to that user.


Microsoft has an alternative plan called Parakeet. That’s actually an acronym for “Private and Anonymized Requests for Ads that Keep Efficacy and Enhance Transparency.” Under this methodology, the browser would anonymize content before sending it to advertising networks that use the information to show relevant ads.


An online group of advertisers proposes to use SWAN instead of third-party cookies. This approach stands for “Secure Web Addressability Network.” Users receive complete transparency over who gets to see their information.


Additional options include Sparrow and Turtledove, both of which are also acronyms.


Although these ideas are only proposals right now (with all bird-related names, for some reason), it serves as evidence for why marketers need the information from third-party cookies or other types of 1st party cookies. When users receive irrelevant ads, there is a negative brand association from that experience. If everything is random, the risks are too significant to reach out through online ads.


Small businesses rely on third-party cookies to ensure their advertising money stretches as far as it can go. If this resource disappears without a viable alternative or better privacy options, it won’t be the death of the tracking mechanism we discussed above, but it’ll affect many businesses.



Author



Helena Nordman Stålnacke

Strategic Advisor

Recoordinate

Connect with me: Linked In


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