Decoding the Mystery of Third-Party Cookies: How They Work and Impact Users’ Online Experience

Chances are, if you use the world wide web, you’ve been asked about cookies. Unfortunately, this doesn’t have anything to do with delicious baked goods. Whether you’re an IT expert or just an average internet surfer, this topic impacts you more than you may know. 

Personal data is a primary focus for many internet users and web owners across the country. While third-party providers have gotten away with collecting and monitoring consumer information in the past, that’s not necessarily the case anymore. 

If you’re curious about how these not-so-tasty cookies affect your online experience, you’ve come to the right place. We’re diving into how third-party data collection works and how it affects user security. Let’s get cooking!

Understanding the Different Types of Cookies

Before you know what a third-party cookie is, you need to know a foundational piece of vocab: cookie. It’s information that a website puts on a user’s computer. A cookie stores a limited amount of data from a web browser session on a particular website that can be accessed in the future. 

A third-party cookie is a cookie that’s placed on a user’s device — a computer, cell phone or tablet — by a website from a domain other than the one the user is currently looking at. This type of information is very popular for online advertising. It tracks a user’s browsing history and online activities so it can present them with personalized ads that the person may be interested in. 

For example, if you’ve been searching for your next summer read, you may quickly receive pop-up ads for a popular book that everyone’s been buzzing about. You can see these advertisements on any site, but they’re especially prevalent on social media platforms.

The reason this happens is because your web browser stored a third-party cookie and is using that insight to target ads that may pique your interest based on your recent search history. 

Now, third-party cookies aren’t the only cookie type you need to know about: There are first-party cookies, too.

Unlike third-party cookies where an outside domain collects user data, first-party cookies are placed on a website by the site owner to collect info for them to use. This type of cookie is generally used to improve user experience by capturing and learning from their preferences and settings. They also keep information stored for that particular website. This could include items in an online shopping cart, usernames and passwords and language preferences. 

Third-party cookies gather user insights across several websites to give third-party data collectors a more holistic view of the person being tracked. By contrast, first-party cookies store information from the owner’s own website and can’t continuously monitor the user’s interactions with other sites. 

Importance of Understanding Third-Party Cookies

Even if you’re not heavily involved with digital marketing or web-based data collection, it’s vital that you have a basic knowledge of what browser cookies are and the ways they’re used. When you know third-party cookies, you can choose cookie preferences that fit your unique needs and better understand how to use them for your own marketing initiatives. 

How Third-Party Cookies Are Collected

Third-party cookies are generated when a website requests resources or scripts from a domain outside of its ownership. For instance, when you visit a landing page that uses an embedded analytics tracker to learn about its audience, the website will send an invitation to the analytics tool company to ask for resources and scripts. The service provider then responds by sending a JavaScript file to the website. This JavaScript is what stores cookies in your browser so the analytics tool can track your online activity. 

This process is fully based on your consent to share information. If you decline the website’s right to track third-party cookies, then the website must block the JavaScript. 

How Brands Utilize Third-Party Cookies for Targeted Advertising

So, how does this relate to marketing? Great question.

As you browse through various sites and shop around, all the e-commerce pages you’re visiting store a cookie on your browser. That cookie pays attention to what items you click on, and it then stores that knowledge for later. 

As you go about your day, you’ll start to notice the same products that you were looking at earlier show up in ads throughout your landing pages. That’s because the site you’re currently on uses the same ad platform as the e-commerce site you were previously viewing. 

Additionally, social media platforms can use third-party cookies to keep you signed into your accounts or allow you to share content seamlessly. 

By enabling marketers to trace a user’s online activity using cookies across several different websites, they’re better able to learn what problems users are attempting to solve and determine the best advertising approach to use on them. This gives them more freedom to interact with their target audience, knowing who’s likely to be the most interested in their goods or services. 

Pros and Cons of Third-Party Cookies

There are two sides of the coin when it comes to third-party cookies. While this style of data collection serves several purposes and helps a wide range of industries, there are still problems with how it functions. 

Let’s take a look at both the advantages and disadvantages of browser cookies:

Pros of Third-Party Cookies

Login Information Is Saved

People are accustomed to the internet working as quickly and efficiently as possible, making most people prone to being impatient. Third-party cookies highlight a very important user desire: convenience. 

A cookie that operates alongside a consumer’s internet surfing can grant them the ability to use pre-filled information on order forms or other types of login pages. People no longer need to remember all their passwords because most of them are safely stored in the browser for when they need them. 

On top of that, websites can also get your location so that you’re given the most accurate ads and information based on your area. 

Everything Is Personalized 

You have unique interests and information that you like looking at, and you’d have to spend more time looking for it if third-party cookies were unable to monitor your search history. Take YouTube, for example. 

The platform does an amazing job of providing you with relevant videos that the system thinks you’ll enjoy all based on your previously viewed content. This allows you to find stories and news without having to search high and low through the millions of available videos. 

Save Company Money

Before third-party cookies, businesses wasted a lot of money trying to reach their target consumers. Some efforts were obviously successful but at a very high cost. Cookies give organizations a much more specific direction when it comes to spending cash on marketing initiatives. 

It’s not beneficial for anyone if the ads being shown to a person have nothing to do with what they’re looking for. According to Survey Monkey, 44% of internet users find the ads they receive to be irrelevant to their wants and needs. Continuously being sent these types of advertisements could ultimately lead to turning more people away from your company than toward it. 

Cons of Third-Party Cookies

Blocking Third-Party Ads 

While browser cookies are very effective and useful, many people avoid them at all costs. When an individual blocks third-party cookies, their internet usage can’t be tracked or followed, leaving marketers with less specific information about the people they’re attempting to reach. It also makes spending money on third-party ads less profitable in the long run.

Security Risks

The benefits that come with third-party cookies can also be turned against users. If a cybercriminal or someone with ill intent has control over an individual’s third-party cookies, they can use it for malicious purposes such as tracking users to steal their personal information or delivering malware to their browser. 

Most third-party cookies are very safe, but as with anything available on the internet, there’s room for human error or dangerous activity. 

Very Little Transparency

If you don’t have a job in technology, marketing or other web-heavy careers, it can be difficult to fully understand what cookies are or what purpose they serve. Because of this, many internet users aren’t aware that third-party cookies are being used to track their activity across the web. 

This lack of clarity can leave people unsure if they can trust the websites they visit, resulting in fear or nervousness about the unknown. 

The Impact Of Third-Party Cookies on User Privacy and Data Security

You can decide for yourself if you believe third-party cookies are beneficial or best to be left alone. But, one thing you can’t ignore is the fact that third-party cookies rely heavily on user information. This is people’s biggest problem with this data collection style, making some users extremely uncomfortable.

Third-party cookies aren’t bad, but their tracking and subsequent targeted advertising have earned them some bad publicity. While cookies allow for personalization, they’re not without risk since outside parties can access consumers’ names, addresses and even credit card information if it’s stored in the browser. 

While many individuals are used to their personal information being widely shared and available (what with social media being so popular), there’s an extra layer of vulnerability that comes with third-party cookies that people may be less likely to agree to. 

And the rise of data breaches and online criminal activity can leave people unsure if their details are safe. In fact, the Identity Theft Research Center found that 1,802 data compromises occurred in 2022 alone. 

Though companies and marketers can’t always keep cybercriminals away from users’ personal data, they can put safeguards in place to protect the information as best as possible. 

Protecting Your Marketing Agency From Hackers

Here are some ways you can keep third-party cookies out of the wrong hands. 

Download Anti-Malware and Antivirus Programs

If ransom attacks have taught companies anything, it’s that any sort of safety measures can be extremely beneficial. Anti-malware and antivirus programs can proactively care for your users’ data stored by third-party cookies. 

Most malware is installed through network security hacks, but being vigilant and implementing counteractive measures can keep marketers and their target audiences sheltered from harm. On top of this, constantly updating your programs as time goes on can keep them in tip-top shape. This could include upgrading to newer routers and computers to installing browser updates as soon as they become available. Whatever can be done to tighten user information is advantageous for everyone involved.

Keep Your Network Under Lock and Key

Marketers’ Wi-Fi network protection is also critical to stop hackers from getting too close. If left unsecured, your connection will basically be an open invitation to anyone and everyone wanting a good look at the data you’re storing. 

The most secure way to stop cybercriminals from accessing data is to simply stop using Wi-Fi and instead use a wired network only. The issue is, this type of connection isn’t very flexible, leaving it out of the question for several marketing agencies. 

If you must use a wireless network, it’s important to disable the service set identifier (SSID) that broadcasts functions on the wireless router. This makes your system practically invisible to internet snoops. 

Educate Your Team and Clients

Knowledge is power. When your team and the people you partner with understand how third-party cookies work and know how to protect stored information, everyone can benefit. Teach them how to lock up company network usage and online operations. This puts company safety at the forefront of everyone’s minds rather than an afterthought. 

It’s also helpful to have a risk management plan in place that lets everyone realize what to do in the case of an emergency. You need to know the most valuable information and assets are protected, no matter what. 

The Future of Third-Party Cookies: Phasing Out and Alternative Solutions

Google Chrome is the most popular internet browser, accounting for over 63% of all global web traffic. That means it has a lot of power in the third-party cookie space, and the company isn’t afraid to use it. 

Third-party cookies have been in the news recently due to concerns about privacy and data security. To combat potential problems and keep users safe, Google Chrome reported it would be blocking third-party cookies that can track users across many different websites. 

This announcement happened in 2020, and three years later, this has yet to occur. But, the global company did say it would turn off third-party cookie support for 1% of Chrome users in the middle of 2024. After that, Google expects to continuously work toward growing that percentage as the year goes on. 

To prepare for this large shift in how online data collection is done, consider these third-party cookie alternatives:

First-Party Data

As the name suggests, first-party data is information collected straight from the source: your customers. This data type will be grabbed from simple site interactions, and will most likely provide only basic information rather than the deep insights you may be used to. 

You can gather this data in a few different ways, including:

• Landing pages.
• Websites.
• Surveys.
• SMS.
• Emails.
• CRM. 

Google Topics API 

Google Topics API sorts the websites your target audience visits into different categories, providing details on what topics or segments individuals are interested in. With this platform, marketers can send relevant ads through these visited sites. This can give users the freedom to pick what types of content category they’re interested in receiving ads for. 

Universal Identifiers 

Universal identifiers are unique user IDs that allow companies to view users from various websites and across multiple devices. They function similarly to third-party cookies as they track people no matter what technology they’re using, and they improve user experience through learned behavior and reduce the amount of lost data. Universal ID solutions can also be built to help with first-party data collection. 

Contextual Advertising 

Contextual advertising is a great option if you want a solution that doesn’t rely on users’ personal data. This type of marketing targets ads based on the keywords and phrases used in the web page content that people read. 

It can be beneficial to learn the overarching topics that people search for, but it doesn’t always provide niche or specific details that advertisers desire. Ads are the most effective when a marketer uses this method with very specifically themed content to match the content categories being searched for. 

Data Pools

Marketers can gather insights about their audience by using data collection pools that are gathered by other advertising professionals and publishers and put into one open repository. While this is useful when millions of data pieces have been added, it’s difficult to use if not enough information is uploaded. 

Also, the publishers and marketers must properly coordinate their insights to get the system to deliver results at scale.

Be Prepared if the Cookie Crumbles

No matter what the future of third-party cookies holds, marketing professionals should be ready. Get an idea of what data insights you’re currently collecting through third-party cookies, and come up with a backup plan just in case the information becomes unavailable in times ahead. 

Ultimately, avoid burning bridges through having your target audience’s best interest at heart by using third-party cookies wisely.