Third-party cookies Vs First-party Data – What’s the Difference?
Cookies are pieces of information stored by websites on your computer. They contain bits of information, for instance, your log-in details, what you’ve liked or added to the cart, and your activity on a page. Cookies can perform a bunch of activities, but for the most part, they carry out data collection for advertising-related processes while also being able to provide a personalized browsing experience. However, privacy issues soon gripped the scenario as the EU’s General Data Protection Regulation (GDPR) and The California Consumer Privacy Act of 2018 (CCPA) offered users more control over how their data was being collected and shared.
The types of Cookies…
There are two kinds of cookies – Third-party cookies and First-party Data. The key difference between the two stems from how they are created and used.
Third-Party Cookies: Third-party cookies are created by domains other than the one you are visiting directly, hence the name third-party. What does this mean in practice? Let’s say you’re visiting a website on which there is a YouTube video on one of its pages, YouTube will then set a cookie which is then saved on your computer. These cookies are used for cross-site tracking, re-targeting, and Ad-serving. One of the most significant concerns with third-party cookies is user privacy. The widespread use of this method would mean that data is fragmented, collected, and circulated across websites, devices, and apps – making it difficult to keep track of who’s doing what with their data.
First-party data: First-party data is any piece of data collected directly from a consumer and is stored by the domain (website) you visit directly. Information is collected directly by the company and is often related to its customers – it can complement, enhance and reduce the need for other types of data. Unlike third-party cookies, first-party data is created by the host domain – the domain visited by the user. This information can be compiled and used by the company to further create, target, and strategize Ad campaigns based on the individual’s interest.
Why first-party data is the future…
From the marketer’s perspective, the situation may still seem murky. But it is crucial to define the goals that you want to achieve and determine what is the most regulation-compliant and correct way to collect data. Enabling first-party data means that it’s your domain that’s collecting the data – giving you control, ownership, and visibility on the kind of data you’re collecting. Overall, first-party data is a flexible way to use data for marketing and analytical strategies.