Cookies identify online users and have become a mainstay of digital advertising. As web servers have no memory of their own, cookies are used to make websites remember the user’s action, so they aren’t asked to perform a task again and again. As a result, they help provide a better, more personalized user experience.
And while most marketers know this broad definition, getting into the weeds regarding the different types of cookies and how they differ from one another can be trickier. However, with Safari, Firefox and Edge all opting to get rid of third-party cookies in the past five years, it's never been more important for marketers to gain a more nuanced understanding.
In the name of building a “more private web,” Google announced they are not unilaterally getting rid of third-party cookies on Chrome after years of back-and-forth. Instead, they are going to invite users to make an “informed choice that applies across their web browsing” (meaning they will likely ask users to opt-in to tracking).
So, what are third-party cookies? And how are they different from the other types of cookies, namely first-party cookies? Read on to find out.
Types of cookies
Let’s run through definitions of first- and third-party cookies before taking a look at how they differ from one another.
First-party cookies
What are first-party cookies? First-party cookies are created and stored by the website you are visiting directly. They are used to collect user data for analytics, remember language settings, and store login information.
Third-party cookies
What is a third-party cookie? As the name implies, third-party cookies are created and placed by third parties other than the website you are visiting directly. Some common uses include:
- Cross-site tracking: the practice of collecting browsing data from numerous sources (websites) that details your activity
- Retargeting: using search activity to retarget visitors with visual or text ads based on the products and services for which they’ve shown interest
- Ad-serving: making decisions regarding the ads that appear on a website, deciding when to serve these ads, and collecting data (and reporting said data including impressions and clicks) in an effort to educate advertisers on consumer insights and ad performance.
Key differences between 3rd-party cookies and 1st-party cookies
From the technical perspective, first- and third-party cookies are the same kind of files. The only difference lies in how they are created and used by websites.
First-party cookies are generated by the host domain. They are usually considered good because they help provide a better user experience. These cookies enable the browser to remember important user info, such as what items you add to shopping carts, your username and passwords, and language preferences.
On the other hand, third-party cookies are mostly used for tracking and online advertising purposes.
Here’s a table summarizing the key differences between first- and third-party cookies:
First-Party vs. Third-Party Cookies
Third-party cookies live on, for now
Third-party cookies have long been the cornerstone of digital advertising, providing a foundation for targeted, measured, and personalized campaigns. While Google's recent announcement may offer advertisers temporary relief, the impending demise of these cookies remains inevitable. In fact, this shift could accelerate the industry's transition away from reliance on third-party data. With a high probability of Google implementing an opt-in system for third-party cookies, advertisers can anticipate a significant decline in data availability as users are likely to decline tracking. This mirrors the impact of Apple's privacy changes.
Epsilon has consistently advocated for a future beyond third-party cookies and believes that marketers must prioritize the development of alternative strategies. By focusing on first-party data and innovative technologies, brands can continue to build meaningful connections with consumers in a privacy-centric world.
What factors led to the planned phase-out of third party cookies, and why has this timeline been delayed?
The advertising industry has been operating in a world with limited third-party cookie access for some time. Safari, Firefox, and Edge phased them out years ago, significantly impacting web advertising. Chrome was the last major browser to rely on third-party cookies.
Google's initial plan to fully deprecate third-party cookies in 2025 faced numerous delays due to regulatory and industry pushback. Their recent decision to modify this approach is unsurprising. While Google frames this change as a victory for consumer privacy, the reality is that this move is likely to benefit the company directly.
Let us help
Because Epsilon’s identity graph is anchored in deterministic purchase data from individuals, it has limited dependence on third-party cookies. The integrity of this purchase data allows us to have 96% accuracy and industry-leading match and reach rates. As a result, we are able to identify and serve 98% of our ads to individuals, not orphaned cookies or device IDs.
Epsilon’s direct relationships with over 5000 publishers also help us defend against third-party cookie deprecation, because through these relationships we are still able to:
- Identify consumers from publisher audiences. Publishers generate IDs based on their first-party data, which is then synced with Epsilon’s CORE ID.
- Connect clients’ advertising goals with publishers’ ad inventory. Our first-party solution in partnership with our publishers helps us better understand the behaviors of users as they interact with publisher sites.
- Deliver personalized, relevant ads. Connecting our ID with publishers’ IDs improves identification of publisher audiences and match rates.
- Reach real individuals. Connecting with the publishers’ authenticated user data (logins, registrations) ensures we are serving ads and optimizing based on individuals, not cookies or device IDs, which may overlap.
Our years of preparation building people-based identity with first-party strategies and relationships will enable us to continue delivering results for our advertisers, while still providing performance transparency.
Contact us now to learn more about our services.
*This article was updated in 2024 to update correct cookie deprecation date.