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What are Cookies on the Internet and How Can They Help Your Business?

computer cookiesCookie consent policyCookie policycookiescookies on the InternetEnable cookiesGDPR data privacy rulesHTTP Cookies
Updated October 22, 2021 Ivana

Whatever industry you work in, you heard of cookies on the internet also known as HTTP cookies, browser cookies, computer cookies, or web cookies – they all are synonyms for one and the same thing.

 

But do you know what these cookies are and why is it important to get your users consent before you use them?

 

 

 

cookies on the Internet influencing business decisions
Source: freepik.com

 

No worries, in this article we will go through:

  • What are cookies on the internet and how do they work;
  • How did they get the name ‘cookies’ in the first place?
  • The different types of cookies available today;
  • What is the connection between cookies and GDPR;

 

What are cookies on the Internet and how do they work?

In 1994, the digital space was introduced to cookies when Lou Montulli, the creator of the whole notion, made them become reality. He was originally developing the idea in pursuit of solving a work-related task at Netscape at that time. But as it happens with technological discoveries, his solution had an incredible additional use.

 

What are cookies on the Internet - customer data collection
Source: freepik.com

 

 

 

Over the years, Cookies have changed and shaped the nature of the Internet as we know it nowadays. Today, a cookie is an instrument that helps websites identify users and improve their online experience. But for the same reason, it is important to be cautious in some cases.

 

So often it happens that your users don’t know what cookies on the Internet are, and some people found it difficult to understand the whole meaning behind it or their purpose. Think about how many times you pressed “Accept all” without reading the terms and conditions of that site.

 

That said, your business requires a strong online presence in order to reach the fundamental business goals that bring you success, and you are probably well aware of how important is the role of cookies within your digital marketing strategy.

 

But it is also your responsibility to make sure your Cookies policies are easily accessible, fully transparent and easy to understand.

 

How do cookies work?

Simply put, the idea behind cookies on the Internet is pretty easy – they remember every visitor, so the next time they enter a website, they won’t be treated as complete strangers. 

 

When your users click on the ‘agree’ button, they agree that you, as a website owner, can use their data to enhance user experience, personalize the ads, which is especially useful when it comes to retargeting, but also when simply showing more relevant content to them.

 

Cookies on the Internet make it possible to memorize your users and their access to your website.

 

When people access a website that uses cookies, a cookie is sent to a person’s computer (or another device through which they accessed the website).

 

In simple terms, cookies are data files stored on a computer, or a browser, thanks to which websites are able to access information such as the activities people are performing online, which then serves for aspects such as marketing purposes

 

cookies data on computer
Source: freepik.com

 

Data dominate today’s world. This means that once you figure out who are your customers, you can find more accurate answers and solutions on how to engage with them and maintain their interest in what you have to offer.

 

And this is the primary reason how cookies can help your business prosper in a long term, and, simultaneously, it is also a reason why it pays off investing time into understanding and learning what are cookies on the Internet.

 

Another example of where we can find a use of cookies are online stores. If you are running an e-commerce business, you surely know how important it is to know your audience, moreover, without cookies, e-commerce stores couldn’t operate as efficiently as they do today.

 

Fun fact: How did they get the name ‘cookies’?

In the beginning, cookies were often called ‘magic cookies’. A magic cookie refers to a data file that a person visiting a website receives, and then the file is sent back.

 

cookies on the Internet - fortune cookies
Source: freepik.com

 

Nowadays, we call them ‘only’ cookies, but the name probably has its origin related to fortune cookies that have a message embodied inside them.

 

Different types of cookies on the Internet

The term ‘’cookies’’ is pretty broad. Even when we consider the fact that cookies also refer to our favourite sweet snack, the scope of cookies on the Internet is still not equivocal.

 

There are some differences between the different types. Once you get to understand the general idea of what are cookies on the Internet, it’s easier to digest the different types, since the core principle remains the same.

 

If you haven’t been paying much attention to cookies ever before, you probably can’t tell the difference between first-party and third-party cookies. Let’s explore the details.

 

Computer cookies (HTTP cookies)

Common names for this type of cookie are also browser, web, Internet cookie, or tracking cookie. As mentioned, you can also come across the term ‘magic cookie’. But they all are data files that your computer receives as you visit a website.

 

In simple terms, cookies help you, as a website owner, to stay well informed of the visits on your websites, which also includes the activities your visitors perform.

 

Wait, but if cookies can provide you with all this information, do you even need to put extra effort to deal with analytic tools? Let us make sure we are on the same page. Analytics tools, such as Google Analytics, are tools that work on basis of computer cookies.

 

Without them, you wouldn’t be able to access all the information about how the audience engages with your website or the demographics of your visitors.

 

You can decide to disable cookies when using Google Analytics, but the functionality will be certainly affected and you won’t be able to achieve the same results.

 

Session cookies

Once you understand what are cookies on the Internet, it’s easy to deduce the principle of other types of cookies. As the name suggests, session cookies are only active while a user is performing the action.

 

So, for example, with session cookies (in contrast to tracking cookies), once the user leaves a website or closes the browser, it disappears, since it’s stored in temporary memory.

 

With session cookies, it is impossible to identify the visitor. Do you recall as we mentioned cookies play a role in e-commerce? Well, without session cookies your users wouldn’t be able to add multiple items into their shopping cart.

 

They would be treated as new visitors on different pages of your website, they simply wouldn’t be remembered.

 

First-party cookies

First-party cookies are those that are created by a website that a person visits. They’re usually used to improve customer experience or to ensure basic e-commerce functions are running smoothly.

 

Third-party cookies

Now you can probably tell that third-party cookies come from different websites than yours. Imagine a situation where a visitor is listing products on your website and then leaves.

 

In pursuit of highering chances that this visitor buys a product you offer, you can decide to show your ads on different websites that person visits.

 

All this is possible thanks to third-party cookies stored on your potential customer’s computer. Those cookies are not used to only improve customer experience, but they’re also tracking their actions performed online.

 

There is a lot of buzz around third-party cookies and users’ privacy due to the vast amount of data that can be collected. Some browsers are taking actions to block third-party cookies on the Internet, such as Safari. Google Chrome is planning to do so in 2023.

 

This can completely change the nature of the digital marketing environment since companies and organizations won’t be able to track users around the Internet anymore.

 

What is possible to do even now when third-party cookies are not banned generally, is to go to Privacy & security settings on Google Chrome. It allows users to block third-party cookies, either only in ‘Incognito mode’ or completely.

 

Cookies on the Internet - privacy settings Google Chrome

 

Blocking all cookies, however, is not recommended, since the user experience can turn out to be significantly worse.

 

So, maybe it’s time to start thinking about new marketing strategies already, so it, later on, won’t influence your business to a significant degree.

 

Cookies and GDPR

The majority of cookies on the internet are completely safe. Their ultimate purpose is to make the user experience better.

 

But the world is not black and white. Some people can take advantage of how powerful the concept is, which can lead to the point that users’ data will be in the unwanted spotlight.  This leads us to the connection between cookies and GDPR.

 

Let’s explore how they work together. 

 

Cookies and GDPR – how do they work together? 

cookies on the Internet and GDPR
Source: freepik.com

 

We all are familiar with GDPR (General Data Protection Regulation) – Europe’s data privacy and security law. Every business and organization from all around the world that aims to collect data from Europe’s population needs to comply with these rules.

 

The GDPR rules have come into force in 2018 and are closely connected to the fact that the amount of data we share online is continuously increasing, and the nature of data ranges from common, ordinary information to sensitive personal details.

 

Every website that uses cookies to obtain and process users’ data needs to inform them of such activities. This is the reason why website visitors are required to agree to the terms and give their consent in order to browse the content.

 

So, you are probably asking what is the threshold when it comes to collecting data about your website visitors. The basic principle is that you should only collect data that are essential for your initial purposes – the goal that has led you to start gathering the data.

 

cookies on the Internet and GDPR
Source: freepik.com

 

As long as the users can be identified, you need to make sure to collect the data lawfully – which is, most commonly, informing them about the purpose of data collection, along with giving them the option to agree to these terms.

 

For example, when visiting our website, you can read about the purposes for which we use cookies, such as personalizing the user experience, or improving our site.

 

It is vital for you, as a business owner, to get knowledgeable insights into what are cookies on the Internet, but being aware of their relation to GDPR rules is as just important.

 

The compliance of cookies and GDPR can’t be left overlooked. Since we are moving on the lawful ground, it is not even a question of whether your business needs to consider it – because it surely does.

 

Conclusion

After reading today’s article, what is the first thing that comes to your mind when someone asks you what are cookies on the Internet? Probably data collection.

 

You don’t need to have a piece of deep professional knowledge to come to a conclusion that you don’t have a free hand when it comes to data collection – they’re regulated by GDPR.

 

But what’s most important for you is how can your business benefit from cookies on the Internet. Let’s review the major points that were discussed today.

  • Remember website visitors and show them personalized content
  • Retargeting

 

Every business owner knows the hopeless feeling when a website visitor was about to finish an order, but in the end, decided to leave.

 

Thanks to cookies on the Internet, you are able to showcase your ads to those people who were interested in what you have to offer and increase chances to successfully convert them.

  • E-commerce
  • Improve customer experience

 

Digital marketing provides you with many ways how to grow your business, and cookies on the Internet are one of them. But don’t forget it’s not always a good idea to put all your eggs in one basket.

 

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