Everything you need to know about the crumbling third-party cookie

March 14, 2022

You’ve probably heard the news by now, the third-party cookie is on the way out. For years, marketers have relied on this form of data to create and track marketing performance, however new consumer priorities, data privacy laws, and evolving technologies are now leading to the third-party cookie’s demise.

If marketers don’t adapt to the depreciation of the third-party cookie, they’ll find it difficult to continue tracking ad performance and drive marketing revenue. Fortunately, customer data platforms (CDPs) allow marketers to tap into zero- and first-party data, helping them take on the cookieless future with confidence.

What is a third-party cookie?

The term ‘cookie’ is attributed to the trail of data left behind by users and track information about users such as browsing history, names, and location. While many are worried about what a future without third-party cookies will bring, this isn’t the only form of data that marketers can rely on: 

  • Zero-party data: Zero-party data is the data that a user offers voluntarily and is typically collected in exchange for content.
  • First-party data: First-party data is the data directly provided by a user. First-party data can be tracked anonymously and delivers insight into the products or pages that drive the most engagement.
  • Third-party data: Third-party data is collected passively without direct interaction with the user. This form of data tracks web activity across websites and is often sold or provided to retailers by a third-party.

What is happening to the third-party cookie?

The third-party cookie is being phased out for a number of reasons. For one, consumers have placed more importance on their individual data privacy. In the wake of data breaches and widespread data collection, your average consumer is much more conscious of how their data is being used and shared. Third-party cookies strike controversy because they track internet browsing sessions passively and across domains. While many sites are required to request permission to track with cookies, this is only a small solution to a bigger data problem.

Data privacy concerns have also led to the creation of laws that secure consumer data online. Laws such as the CCPA (California Consumer Privacy Act) in the United States and the GDPR (General Data Protection Regulation) in the European Union work to regulate the way in which businesses collect and store data, directly mitigating the effectiveness of the third-party cookie.

Technology providers such as Google and Meta have also moved to eliminate the third-party cookie, partly because of privacy concerns but more importantly because of new cookieless technologies. In truth, the third-party cookie no longer fits within modern digital architecture. Nowadays users are interacting with the web via a mix of different devices and browsers. As a result, this patchwork of connections gives marketers an incomplete picture of who their customers really are and what they really want.

How to resolve your third-party cookie problem

The best way to adapt to the third-party cookie is to rely more on zero- and first-party data; and CDPs can help you make the most of this form of data.

Customer data platforms (CDPs) act as a unified hub for processing vast amounts of customer data and translating that data into actionable insights to deliver meaningful customer experiences. Often GDPR and CCPA compliant, CDPs are able to collect and connect data from multiple sources, helping marketers create hyper-targeted audiences to leverage across all your marketing channels, paid and owned.

CDPs can provide some of the following solutions to help your business adapt to the cookieless future:

  • Unified zero and first-party data collection:  CDPs support zero-party data collection by unifying databases and streamlining access to marketing teams. A CDP helps marketers seamlessly tap into the zero-party data collected via multiple channels.
  • Enhanced customer experiences: CDPs help you transform the insights gathered via your zero- and first-party data into actionable insights you can use to enhance customer experiences. An effective CDP will allow you to take a granular approach to customer segmentation, granting your marketing teams the capability to segment based on a wide range of attributes.
  • Create a single customer view: Using your zero- and first-party data you can create a more accurate depiction of who your customers really are through a single customer view. A single customer view means you have one platform for every customer interaction and have a complete picture of the data you’ve collected about them.

CDPs like Lexer can help your business connect, collect, and enrich your customers’ zero- and first-party data to create more engaging experiences without invading your customers’ digital data privacy. Built with busy retailers in mind, Lexer supports leading brands and retailers to drive sales growth through improved customer engagement.

This article was adapted from Lexer’s playbook, ‘How a CDXP can solve your missing cookie problem’. If you liked this, you’ll probably be interested in the playbook as well. Click here to download the playbook.