Cookies are an important part of the world wide web, yet many people fail to realize the role that they play. Without cookies, many of the functions that are almost automated today with the second visit to a website become tedious and manual. As an internet advertiser, understanding different factors that are involved with the ad-serving process is important – and cookies are one of these factors that you should not overlook. This article allows you to discover more about web cookies, cookie syncing, and why they are important in advertising campaigns.
The Humble Web Cookie
Let’s first take a closer look at what web cookies are and where they originated from. When we talk about web cookies, we’re not referring to the freshly baked cookies you can find at your local bakery. Instead, we’re talking about a digital “file” that gets stored on your computer and sometimes also on servers. Lou Montulli, a web programmer, was the first to call these files “cookies,” and it continues to uphold this name today. The idea behind the naming of these files stems from fortune cookies – which contain messages on the inside. Similarly, when a cookie is stored on your computer, it contains embedded information.
What Are Cookies
Cookies are essentially text files that are stored on the local computer of the user. Sometimes, servers also store cookies. They are some of the fundamentals in the modern-day web, similar to how you require power, code, and internet access to function websites.
Cookies essentially store information regarding your session data when you browse a specific website. The cookies then serve as a way to remember your preferences, account details, and other factors when you come back to this particular website later on.
While cookies are beneficial in many ways, there are also some concerns among the population. One concern comes in the form of tracking data that is utilized by cookies, often used by servers in order to deliver targeted ads. People are often concerned about the safety and privacy of their personal data when trackers collect data in cookies.
The European Union implemented new regulations that demand websites ask the users’ consent to allow cookies to be used to track their personal data. Since the implementation of these regulations, millions of websites now ask for consent in the form of a popup or banner to ensure users are able to block cookies if they are not satisfied with the tracking capabilities.
Different Types of Cookies
Not all cookies are exactly the same. It’s important to understand the two main categories that cookies can fall under, and how each of these works. The two primary categories include first-party and third-party cookies.
We will take a closer look at each of these cookies and how they are used to deliver better experiences to users but also benefit advertisers and publishers at the same time.
- First-Party Cookies: These are a common type of cookie that websites generally use to ensure it remembers whether you are logged in, what you added to a cart, or specific preferences that you configured on the site. First-party cookies are created by the website you visit and are then stored as a text file on your local hard drive. When you visit the website again, the website server will look for a cookie file associated with a previous session. If there is no cookie stored on your computer associated with the website, then it will create a new one. The idea behind these cookies is generally related to the user’s experience. Not having to sign in to your account every time you visit a website is convenient, after all.
- Third-Party Cookies: Third-party cookies are not created by the website you visit itself. Instead, there are third-party or external servers involved in the creation of these particular cookies. Third-party cookies are also called tracking cookies. They are most often created by advertisers in order to track user behavior and actions and then display the most appropriate ads based on the collected data.
From Cookies to User IDs
Cookies are used to store data related to a user’s session, login status, credentials, and more. There are different kinds of data points that a cookie can hold in order to enhance the user experience. The problem, however, is the fact that there is a limitation to the maximum size of the cookie’s text file. This does limit how much data can be placed in a cookie.
Many publishers have started to move to a different way of handling cookies. By only storing a unique identifying number (user ID) in the cookie’s text file, it significantly reduces the overall size of the cookie. This user ID is then linked to data stored on a server. The server could include the one hosting the website, in which the data collected will be used, similar to how first-party cookies work. Sometimes, the cookie’s data is also shared with a third-party server, where it is associated with the correct user ID, and data can then be seen in the advertiser’s database. This makes it possible for advertisers to collect a more significant amount of valuable data regarding user behavior and interests, thus essentially improving ad targeting measures.
The Problem AdTech Companies And Advertisers Face With Cookies
Cookies themselves have some limitations in terms that they are only readable within the exact domain where they were created. An AdTech company that wants to collect data would not be able to read information from first-party cookies that were created by the website itself. This brings about a barrier, as it limits the amount of tracking data that the third-party AdTech company and advertisers are able to access.
What Is Cookie Syncing?
Cookie syncing presents a solution to the current limitations that advertisers and AdTech companies tend to face with cookies. The data that a cookie store is crucial when it comes to targeting the right people with an advertising campaign. Insufficient data collection can result in targeting the wrong people or getting fewer results than what is possible from an advertising campaign.
The majority of AdTech platforms now rely on cookie syncing. The idea behind cookie syncing is to remove the barrier that exists when one third-party tracker wants to read and collect data from one that was created on a different domain.
How Does Cookie Syncing Work?
As an advertiser, it’s important to understand how cookie syncing works. This can help you determine the role that it will play and what to expect when utilizing the technology for your own targeting and ad campaigns.
When a user visits a specific website, a third-party cookie is created with a unique ID. This ID is used to identify the specific user. This data is then synced with a third-party server, where information can then be collected. If the user visits another website, that website also creates a cookie, but when the data is submitted to the third-party server, it is connected to the user’s entry in the database.
A pixel graphic is usually used, along with an associated URL, in order to assist with cookie syncing.
How Is User Data Shared Between AdTech Platforms?
There are several factors and processes involved in cookie syncing. The sync with the third-party server is one of the important steps that happen, but then the user’s data still needs to be shared with other platforms. Two platforms related to AdTech companies will essentially sync data between them. User data and cookie information are compared, and once this connection has been established, data can now be shared between the AdTech platforms.
As an example, the user may visit one e-commerce store and decide to take a look at a few video games for the PS5 console. A cookie is created, and the cookie syncing process ensures the data enters the third-party server. Later on, the user visits another website – and now, with cookie syncing, the ads served on this site know that the user has an interest in buying a new PS5 game.
What Are The Typical Cookie-Match Rates?
Numerous factors are involved in determining the cookie-match rate. This rate refers to how many cookie IDS syncs successfully between two platforms. Most advertisers consider a 60% cookie-match rate to be a good aim, and the higher the percentage, the better. If the match rate is lower than 40%, it is considered to be poor.
Cookie-match rates can be affected by factors like the third-party servers being hosted in different countries. Additionally, elements like users deleting the cookies stored by their browser can also reduce the cookie match rate.
Cookies play a very important role in ensuring websites are able to remember users, simplifying the experience when visiting a specific domain again in the future. Advertisers also need to have a thorough understanding of how cookie syncing works and how this particular technology could impact the serving of their advertisements. We covered both cookies and the cookie syncing process to help you get a better idea of how these components work.