While Apple and Google’s elimination of third-party cookies has given marketers, ad tech firms, and developers angst, it’s been evident for years that cookies and cross-site tracking have become an issue.
Governments around the world have been tightening up user privacy rules. And, the industry has been adapting to GDPR and CCPA rules over the past few years. So, most of us saw this coming.
The Difference Between First-Party and Third-Party Cookies
Let’s take a look at the difference between first-party and third-party cookies.
When a person visits your website, a code is generated and is stored on your visitor’s computer by default. This cookie is predominantly used for user experience, such as saving passwords, preferences, selections, and other data.
First-party cookies allow you to learn about what a user did while visiting your website, how often they visit your site, which pages they viewed, related links they may have clicked on, and other data analytics. This data can then be used to develop or automate a related marketing strategy. However, you can’t access data collected from other websites that are not related to your domain.
Third-party cookies are tracking codes placed on a web visitor’s computer after being generated by another website. When a visitor visits your or other websites, the third-party cookie tracks the data and sends it back to the website that initially created the cookie.
For marketers and advertisers, third-party cookies allow you to learn about your visitor’s overall web browsing behavior. This includes websites they frequently visit, purchases, and interests. With this data, you can create visitor profiles and a retargeting list that can send ads to previous visitors and other people with similar web profiles.
So, if third-party cookies improve the user experience, why are they under attack? Because the majority of third-party cookies are used for advertising purposes. Web users are unaware of the majority of data collected and its use, which has created animosity among consumers. 64% of respondents in a HubSpot study said ads are annoying and intrusive.
Apple to Block Third-Party Cookies
In April, Apple began requiring all apps on its devices to ask users for permission before tracking activity on other apps and websites. This is a logical extension of Apple already prohibiting unauthorized third-party cookies on its Safari web browser.
Apple’s change will work similarly to pop-up windows you currently see in apps that ask for permission to use your phone’s camera or microphone. Apps will have to prompt users to enable third-party cookies.
This change will most likely have a significant impact all over the internet due to the popularity of Apple products. App developers are especially at risk of advertising revenue loss since it’s presumed most people don’t want to be tracked when given the option.
Apple justifies its change as improving privacy. Consumers want more transparency and control over the collection and usage of their personal information.
Google Creates an Alternative to Third-Party Cookies
Google is creating a cookie alternative with the development of its FLoC technology. FLoC will track groups of people as opposed to individuals.
By 2022, Google will remove third-party cookies tracking from its Chrome browser and replace it with FLoC. Marketers will be able to target buckets of consumers based on like-minded interests. Thousands of individuals make up each group. So, someone who visits ENews.com may be put into a group of celebrity gossip fans.
Advertisers can market to groups, but not the individuals within the group. In trials, Google says, marketers converted their commercial messages to sales at 95% of their rate with the old cookie system.
Google says its new policy will help improve privacy and the survival of web publishing which relies heavily on ads. Regardless, the change will significantly impact how ads are targeted on websites as chrome usage accounts for more than half of online browsing.
What Happens Next?
For the most part, these changes will improve privacy and transparency. Marketers will even have the opportunity to adapt and leverage new strategies to create more relevant and compelling ads that are less off-putting to consumers.
Apple now requires apps to ask for permission to use third-party cookies, which can directly impact the business model of many free apps like Facebook. This could result in new subscription fees.
Google’s changes will heavily impact some aspects of marketing and advertising, while other tactics will mostly stay the same.
If you rely primarily on first-party cookies, tracking your website’s visitors’ behaviors, preferences, and basic demographics, you most likely won’t be deeply impacted by the changes.
But, if you rely heavily on mass amounts of data from advertising, pop-up ads, and pinpointed audience-targeting strategies, you will need to consider alternative methods.