The difference between first party and third party cookies

Cookies are a leading means of collecting online customer data for businesses. Despite being prevalent in most common digital practices, many users have a limited knowledge and understanding of what they are, why they are so important, and what’s happening with cookies in the digital space today.

Cookies: What Are They?

Think of cookies as a memory stick inserted into a web servers' domain. Websites don’t have an inbuilt memory therefore cookies serve as a means of tracking and remembering the journey of a site visitor, collecting data to help the domain owners create a more personalised experience for the customer. Cookies will also collect data on users storing it for other marketing functions such as direct communication and tailored offers.

Types of Cookies

In the context of this discussion there are three types of cookies to examine. Third party cookies, second party cookies, and first party cookies.

Third Party Cookies

This form of cookie exists externally to the site in which they sit on, being stored in and utilised by a third party entity. Over the last couple of years third party cookies have come under fire due to the manner in which they operate. Third party cookies have created a plethora of privacy concerns for website visitors and customers ranging from cross-site tracking to unwarranted data collection.

Second Party Cookies

Technically second party cookies don’t exist due to the fact that cookies are either housed on your own domain (first party) or externally (third party). Second party cookies refer to when cookies are used to share first party data (collected from a first party cookie) with another business (the second party) due to a data partnership or interests aligning. For example, an airline may share its anonymised data with a partnered hotel for targeted advertising which helps to improve campaign efficiency and conversion rates.

First Party Cookies

These cookies are housed on the domain of the website/business owner. They generate first party data on customers and site visitors, allowing the owners to collect customer analytics/demographics, remember language settings, and other insights that help optimise the user experience. With the growing concerns surrounding third party cookies and data, businesses are being encouraged to move into first party systems to carry out their data collection and management functions.

Difference Between First Party Cookies and Third Party Cookies

There are three key differences first party cookies have over third party cookies that contribute to their superiority in the digital space.

Setting the Cookie

As mentioned earlier, what defines a cookie as first party or third party can simply be quantified by how it is manufactured and managed. A first party cookie is built into the publisher’s server or the site owner’s domain, whereas a third party cookie is set by an external third party server, such as an AdTech vendor (often large walled gardens like Google or Facebook), or they are coded into the website. In having a first party cookie you have complete control over that cookie and the data it produces as it lives in your digital ecosystem.

Browser Support

The second difference, and possibly the most important one to make note of given what is circulating in the digital space with the removal of third party cookies, is browser support/blocking. The announcement from Google that Chrome will join all other major browsers and block third party cookies in 2023 is why they will cease to exist, or no longer be usable, thus heavily restricting the marketing activities of companies whom are reliant on this form of cookie or it’s data. The difference here lies with the fact the first party cookies are universally accepted by all browsers, and will continue to be post the deprecation of third party cookies. On top of this many users have been proactive with their web privacy by blocking third party cookies on their own.

Cookie Availability

The final differentiating feature between the two forms of cookies lies with its availability. First party cookies are exclusively available to the domain that created it, giving unique value to the data it produces. Whereas, a third party cookie can be accessed on any website that loads the third party server’s code.

The Destruction of Third Party Cookies

Come 2023 third party cookies will find home in the digital graveyard, ceasing to exist. This has been years in the making with growing concerns over consumer privacy. This has left a lot of marketers and businesses looking to alternative measures in collecting customer data online, with the only viable option being first party systems.

With a plethora of first party solutions that exist it is important to find one that transitions your business across systems as cost effectively and time efficiently as possible, while ensuring the issues experienced in the third party world (lack of transparency, control, and privacy of data) are no longer apparent on your new data environment.

The Crystal Box founders have spread their expertise across a number of top 100 ASX listed companies, helping bring on the age of first party data in Australia. They have productised their expertise and created a first party solution that eases you out of the third party methodology, bringing you into the future of data collection, management, and measurement.

Not only does the Crystal Box solution build your first party system, moving you away from third party processes, but we secure your data and give you complete control of every insight you collect. No longer will your valuable data continue to leak, nor will external entities have the power to commercialise your customer data.

Learn more about the Crystal Box Solution >