Digital Privacy Laws & Analytics Data: Part 1
Written by Emma Anderson
What is a Cookie & How Does It Feed My Data?
In January, Google announced it would do its part to improve online privacy protection by phasing out third-party cookies in its browser. Chrome, which is the preferred browsing service for 62.3% of the market, is among the last to take steps to limit third-party cookies. Safari, Apple’s browser, blocked third-party cookies in 2017 (making marked improvements in 2020), and Firefox followed suit in 2019. However, with the most popular browser finally deciding to eliminate third-party cookies, website owners are taking notice. Most aren’t even aware that cookies exist, let alone how they factor into measuring a website’s performance. Others are wondering what this will mean for measuring the effectiveness of their digital marketing campaigns. In this two-part series, we will examine not only what a cookie is and how it feeds your analytics data, but also how newly enacted digital privacy laws are paving a new way for the future of analytics data.
What is a Cookie?
Delicious as they sound, cookies are nothing more than small files containing user-specific information that are stored to your computer. When you return to a website that has stored cookies on your computer, the website is able to recognize you as a returning user. Pragmatically, cookies are essential for secure websites, which require you to log in to access sensitive information – like your bank accounts. Cookies were first implemented in a web-based setting to create reliable online shopping carts. By storing packets of information specific to a user’s session, users would be able to click through a website, add items to their shopping cart, and finally check out with all of their saved items. Without cookies, these items would disappear from the shopping cart anytime the user clicked to a new page within the website. Cookies are browser-specific and site-specific. Cookies stored during a session browsing on Chrome cannot be accessed by Firefox. Similarly, Facebook will not be able to access cookies saved on your device from Amazon. These are called first-party cookies because they provide information to the website you are visiting about your activity on their website.
Third-party cookies, those villainized for watching your every move, will follow your behavior from site to site, which is why you will see adds on Facebook for products you’ve been searching for in Amazon. These are ad-based cookies, and they are the underlying reason for the digital privacy laws going into effect around the globe.
How Do Cookies Feed Analytics Data?
First-party cookies are at the heart of many key analytics metrics. Traffic source, bounce rate, time on page, and session activity are all key metrics in understanding the effectiveness of a website. All depend on first-party cookies to some extent.
Cookies are used to track a user’s movement throughout the website during a single visit, including at what point they leave the site. This data provides excellent insight into which pages are effective and which need some tweaking. Cookies also provide critical information about how visitors accessed the site. Whether from paid ads, organic search results, or social media posts, this tells a business owner where to focus their efforts. If a lot of visitors are coming from paid ads, this is a good sign these advertisements are a good investment. Particularly if the visitors from these ads click through and ultimately engage with the business.
Google Analytics also relies on third-party cookies already present on users’ computers. Demographic data — age, gender, geographical location, and “affinities” (interests) — can be measured using third-party cookies. These metrics tell a business who is being drawn to their website. If their digital marketing campaign is missing their targeted market, a business can adjust as needed. While they can provide useful information, the use of third-party cookies does pose privacy concerns. In fact, they are the driving force behind many of the digital privacy laws going into effect around the globe. Added to a user’s computer by ad networks and advertisers (often without the user’s knowledge or consent), these cookies track browsing experiences from site to site. By tracking user preferences and behaviors, ad companies can target users. These cookies are responsible for ads seeming to follow you around as you browse the internet. In some cases, user browsing data is sold to yet another third-party, who then targets the user. One big problem with third-party cookies is that neither the site user nor the website owners can control (or even be aware of) who can read the data stored in them.
In our next installment, we will examine some of the newly enacted digital privacy laws that have come about as a result of these third-party cookies. We’ll explore their significant impact on how websites handle cookies and discuss the future of analytics. Read more by clicking on the linked article below.
Measuring website performance is a critical component of successful business’s digital marketing campaign. With the changes in digital privacy standards and their impact on how we can measure website performance, a nuanced, innovative approach is required. At EveryDayta, we provide comprehensive analytics reports that provide a complete view of the effectiveness of a business’s digital marketing campaign. By focusing on the whole picture and measuring website performance as well as social media engagement, our reports provide businesses the knowledge they need to leverage their online presence. Contact us today [link to contact us] to schedule a consultation and see just how high your business can climb.