How Does the Death of Third-Party Cookies Impact Your Digital Marketing?

Katie Holmes
21st February 2023

Wondering about the future of third-party cookies? With Google announcing changes we explore how marketers can best plan for the third-party cookie apocalypse.

The launch of Apple’s iOS 14.5 update and Google’s third-party cookie phase out has made traditional multi-touch attribution less effective. Here at Ruler, we’re on a journey to combine multi-touch attribution and marketing mix modeling (MMM) to create a more effective approach to marketing measurement. Book a demo to learn more.

For years, the third-party cookie has been the workhorse of tracking website visitors across the internet.

But this will soon come to an end as Google has announced plans to phase out third-party cookies by 2024. Google stated that this move was part of their broader efforts to improve online privacy and security for users.

So what does this mean for marketers who rely on third-party cookies to track visitors engaging with their content and website?

Stick around to find out. 

In this blog, we’ll discuss:

💡 What are cookies in digital advertising?

Cookies are small text files that are stored on a user’s device (such as a computer or a smartphone) when they visit a website. 

Cookies are used to collect data about the user’s browsing behaviour, such as the pages they visit, the links they click on, and the amount of time they spend on each page. 

This data is then used by website owners and advertisers to better understand user behaviour and to personalise advertising and marketing messages.

What are third-party cookies?

Third-party cookies are cookies that are created by domains other than the one that the user is visiting. 

They are often used for online advertising purposes and allow marketers to track users’ browsing behaviour across multiple websites.

Let’s say you visit a website to read a news article. 

That website might use first-party cookies (we’ll get to these shortly) to remember your preferences or to track your activity on their website. 

But it might also contain third-party cookies from advertisers or analytics tools that are embedded on the page. 

These third-party cookies can then track your activity across other websites that also use the same advertiser or analytics tool.

Initially, cookies were only used to store user information, such as login credentials and shopping cart contents.

But in the early 2000s, the use of third-party cookies for online advertising and marketing began to gain popularity. 

Advertisers and marketers realised they could use cookies to track users across multiple websites and to gather data about their browsing behaviour and interests.

And since then, third-party cookies have become a cornerstone in the advertising ecosystem… 

…Until recently.

What is considered a third-party cookie?

There are a few third-party service providers that use third-party cookies.

Ad retargeting services

Ad retargeting literally means following previous website visitors around the web and showing them ads for the products or services they’ve viewed previously. Retargeting mainly occurs across social, display and email.

Live chat pop-ups

Live chat services leave a cookie in your browser to streamline user experience. But, it means the live chat pop-up can identify you every time you visit. It allows the live chat software to track your name and details along with previous conversation history.

Social buttons

Social media plugins on your website allow users to login, share and like content. But these also use third-party cookies. As such the social channels track the sites you visit and then share relevant ads when you revisit those social media sites. Even logged out, the cookies follow you as you browse.

💡 Pro Tip 

Not only do you have cookies to contend with, but the iOS update has shaken things up for advertisers too. In this blog, we look at what changes came into place and how you can get around them to ensure you can still get oversight of the performance of your ads.

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

Third-party cookies aren’t the only way to get user data and target the right people. There are also first-party cookies. 

First-party cookies are created by the website that the user is visiting, and are used to remember user preferences and to improve the user experience on the site. 

From a technical perspective, there’s not any major difference between the two types of tracking cookies.

Both cookies contain the same pieces of information and can perform similar functions. The real difference between these two cookie types is how they’re created and used.

First-party cookies are created by the website that the user is visiting. These cookies are used to remember user preferences, login information, and other settings, and to improve the user experience on the website. 

For example, a first-party cookie might be used to remember a user’s shopping cart contents on an ecommerce website or to personalise content based on the user’s location or language preferences. 

In other words, first-party cookies are only accessible by the domain that created them.

On the other hand, third-party cookies are created by domains other than the one that the user is visiting, and are used for advertising and marketing purposes. 

Third-party cookies are often used for cross-site tracking, which enables advertisers to gather data about users’ browsing behaviour across multiple websites, creating potential privacy and security risks.

For example, a third-party cookie might be used to track a user’s activity across different websites and to show targeted ads based on their browsing behaviour. Unlike first-party cookies, third-party cookies can be accessed by any domain that embeds them on their website.

What does the future hold for third-party cookies?

Third-party cookies have played a major role in online marketing and tracking for a long time.

But in recent years, third-party cookies have been the subject of controversy due to concerns about privacy and security. 

Many users have become uncomfortable with the idea of their data being collected and shared without their consent. 

Major web browsers, Mozilla Firefox and Safari, took the step to implement restrictions on third-party cookies back in 2013. But in 2020, Google announced they were also joining the battle against third-party cookie tracking. 

Google announced it was starting the phase-out in February 2020 but stated in 2021 that it would be delaying the ban on third-party cookies on its Chrome browser from 2022 to 2023 (now to 2024.) 

The company explained that it was taking this action to provide more time for the industry to develop alternative solutions for online tracking and advertising that respect user privacy.

As it stands, Google Chrome, Safari and Firefox take up 94% of the global desktop browser market share.

So, once Google pulls the plug on third-party cookies, they’ll effectively be gone for good. It’s why Google’s phase-out is often referred to as the “death of the third-party cookie.”

How are marketers reacting to the third-party cookie phase out?

The cookie phase-out has forced marketers to rethink their approach towards online tracking and advertising. 

While it may pose some challenges in the short term, it also presents an opportunity for marketers to invest in new technologies and strategies to prioritise user privacy and still allow for effective targeting and personalisation.

Here are three ways advertisers are fighting against the third-party cookie apocalypse.

First-party data tracking

First-party data is the top priority for most marketers.

Remember, Google isn’t phasing out all cookies. It’s third-party cookies we’re waving goodbye to, not first-party cookies.

With first-party data, businesses can navigate the phase-out of third-party cookies by enabling them to establish a more direct and personal relationship with their customers, comply with privacy regulations, and gain greater control over the quality and accuracy of the data they collect.

One of the easiest ways to collect first-party data is to use a data tracking tool. And there are plenty of solutions out there you can use to collect and analyse valuable first-party data about your website visitors.

Take Ruler Analytics, for example.

Ruler Analytics is a marketing attribution tool that helps businesses measure the impact of their marketing efforts on revenue. 

It tracks website visitors and their behaviour, and connects them to sales data, providing insight into which marketing channels and campaigns are generating the most profitable outcomes.

The great thing about Ruler is that it allows you to create your own first-party cookies directly on your own domain.

That means you can track users through every session and engagement. Plus, even better, it allows you to track your lead sources and attribute your closed sales back to your marketing.

Let’s use a quick example.

Sara visits your site for the first time via a PPC ad campaign. Ruler begins to track her, noting her source and interactions on your website.

She revisits your site via a Facebook advertising campaign. Again, Ruler tracks her source and her session information thanks to its first-party cookie solution.

tracking customer journeys with Ruler

Sara visits again via an organic session and converts into a lead via a form fill. She converts, so Ruler fires all of the data on Sara over to your CRM so you can see key marketing details.

lead source data with ruler analytics

Sara submitted a form requesting a demo of your product, which she sits two weeks later. There, she closes into a £3,000 deal. 

Once the salesperson updates this in your CRM, Ruler fires again, breaking down that revenue and attributing it (according to your chosen attribution model) both in Ruler and in your analytics tools.

That means you can log into Google Analytics and see that your PPC ad and Facebook ad both drove revenue.

There’s more yet. 

Ruler also has marketing mix modeling. This helps businesses understand the impact of their invisible touchpoints (e.g. ad views, TV and radio impressions) on customer behaviour and revenue.

It’s designed to provide businesses with a more accurate and comprehensive view of their advertising performance by attributing credit to clicks and impressions. 

Unlike attribution, MMM uses aggregated data to identify patterns and correlations between marketing activities and business outcomes.

Marketing mix modellng has been around for decades, but it’s likely to have a resurgence due in this post-cookie era.

We won’t go into the details here as we have a blog dedicated to marketing mix modelling and its impact on marketing measurement.

Contextual advertising and content

Contextual targeting is one approach that marketers are using to address the ban on third-party cookies.

With third-party cookies being phased out, contextual targeting offers an alternative way for advertisers to reach their target audience. 

By analysing the content of a web page or app, advertisers can determine the topics or themes that are most relevant to their target audience and serve ads accordingly.

For example, let’s say you’re browsing a website about gardening and reading an article about how to plant tomatoes. 

The website uses contextual advertising to display ads that are relevant to the content on the page. In this case, you might see ads for gardening tools, tomato seeds, or other gardening-related products.

The website uses technology to scan the text on the page and identify keywords that are relevant to the content. The advertising platform then uses these keywords to display ads that are likely to be of interest to the user.

Contextual targeting has many benefits over third-party cookie-based targeting. Some of these include:

People-based targeting 

Last up we have people-based targeting.

With the ongoing shift away from third-party cookies, people-based targeting is becoming increasingly important for advertisers. 

People-based targeting is a type of advertising targeting that relies on first-party data, such as data collected from a company’s own website or mobile app, to identify and target specific individuals with ads.

People-based targeting typically involves the following steps:

Final thoughts on third party cookies

Third-party cookies are coming to an end.

But the ban on third-party cookies isn’t a bad thing.

This shift in data collection has allowed us to rethink how we collect and use data in a more privacy-conscious and user-friendly way. 

And by leveraging first-party data and people-based targeting strategies, advertisers can deliver more personalised and relevant ad experiences.

Don’t forget. Ruler makes the process of collecting first-party data a whole lot easier. 

You can see how Ruler Analytics works by booking a demo with our team. We’ll show you how Ruler uses first party data to track your website users and closes the gap between your marketing and revenue.