Image of cookies with letter G for Google plus a Shopify logo

Google will phase out third-party cookies in Chrome, with plans to disable them for all users by the end of 2024. With Google Chrome having a 65% browser market share, this decision marks a pivotal moment in eCommerce, as merchants must now confront the daunting task of navigating a digital landscape devoid of the familiar crutch of third-party cookies.

These cookies have been the backbone of eCommerce marketing for years, offering invaluable insights into consumer behavior and enabling personalized experiences. However, with their impending demise, merchants must find alternative strategies to decode customer preferences and drive conversions.

Join us as we explore the ramifications of Google’s phase-out of Chrome third-party cookies specific to Shopify merchants, dissecting its impact on eCommerce and the imperative for adaptive strategies in an evolving digital landscape. And if you’re struggling to navigate this change, please reach out. Our highly experienced eCommerce tech team can answer any questions you have on this topic and advise any updates that may be needed to your Shopify online store infrastructure.

Understanding the Transition: Third-Party Cookies vs. First-Party Data

Before we delve into the implications of Google’s decision, let’s review some key terms. 

What are Third-Party Cookies?

Third-party cookies are tiny bits of data generated from various websites you visit. They’re saved on your device by your web browser as you browse the internet. Advertisers and analytics companies (i.e., Google, Microsoft, Meta, Facebook, TikTok and Amazon) use these cookies to follow what users do across various sites, creating profiles for targeted ads, personalizing content, and measuring ad effectiveness. 

What are First-Party Cookies?

First-party cookies (also known as direct or primary data) only gather information about your activity on a website while you’re using it. They don’t track your activity across the internet. Instead, they help the website remember important things about the visitor, like their login details, what items they’ve added to their shopping carts, and how they navigate the site. They ensure that users can seamlessly move around the site without logging in repeatedly or losing items in their shopping carts. The website owner can get valuable insights into how people use the site, helping make informed decisions to improve it. Plus, they aren’t blocked by anti-tracking browser settings, ensuring accurate data for personalized experiences.

The Importance of Third-Party Cookies in Shopify eCommerce

Third-party cookies have long been the unsung heroes of eCommerce, working quietly behind the scenes to fuel marketing strategies and drive business growth. For Shopify merchants, these digital breadcrumbs are pivotal in understanding customer behavior, offering a treasure trove of data that empowers them to make informed decisions and deliver personalized experiences.

Cross-Site Tracking: They enable marketers to track user behavior across multiple websites, providing a comprehensive view of user interests and preferences. 

Targeted Advertising: By understanding user behavior across various sites, marketers for Shopify online stores can deliver more relevant ads, increasing engagement and conversion rates. 

Campaign Performance Analysis: Third-party cookies also help measure the effectiveness of marketing campaigns, allowing for optimization and efficient resource allocation based on user interests. 

Third-party cookies, used for nearly three decades, are facing a decline due to rising privacy concerns and regulatory changes. As third-party cookies fade away, Shopify merchants must prioritize user privacy and adapt by embracing alternatives like first-party data for effective marketing in a cookieless world.

Hanging key tag that says Privacy Please

Why Google’s Phase-Out of Third-Party Cookies Matters for Shopify eCommerce

Google’s decision to remove third-party cookies for Chrome users matters for online merchants due to its impact on online advertising and user privacy. This initiative aims to enhance privacy by limiting cross-site tracking by restricting Chrome’s third-party cookies. The move aligns with users’ increasing demands for transparency, choice, and control over their data. While Google isn’t banning all cookies, it plans to phase out third-party cookies in 2024, preserving first-party relationships vital for basic data tracking about website visitors. This transition will affect digital marketing strategies, emphasizing the importance of leveraging first-party data and exploring alternative solutions.

How will Google’s phase-out of third-party cookies affect Shopify merchants directly?

Google’s plan to phase out third-party cookies in Chrome by late 2024 will significantly affect Shopify merchants in several ways:
  • Reduced Cross-Site Tracking and Retargeting: It will be harder for Shopify and Shopify Plus merchants to track customer behavior across different websites before they make a purchase. This makes it difficult to retarget ads based on users’ browsing activity on other sites, decreasing the effectiveness of retargeting campaigns.
  • Reliance on First-Party Data Collection: Collecting first-party data through methods like email lists, surveys, and loyalty programs will become essential for building customer profiles and enabling targeted marketing and personalization efforts.
  • Impact on Ad Platform Integration: Advertising platforms, such as Facebook and Google, use third-party cookies for conversion tracking, audience building, and attribution. Shopify merchants who do not adopt first-party cookie tracking solutions provided by these platforms may see reduced effectiveness.
  • Changes in Attribution Modeling: Multi-touch attribution models, which distribute credit across multiple marketing touchpoints, particularly for top-of-funnel activities, will be affected. This means Shopify merchants may have less visibility into the complete customer journey before a purchase.
  • Shift Towards Contextual Advertising: With limited user-level tracking, contextual advertising based on webpage content, rather than user behavior, is expected to become more important for Shopify stores. This will require adjustments in ad targeting and personalization strategies.
Overall, Shopify and Shopify Plus merchants should see these upcoming changes as a chance to improve and get closer to their customers. By being open and respecting customer privacy, businesses can earn trust and loyalty, giving them a long-term edge in a privacy-focused digital world.

The Consequences of Non-Compliance

Non-compliance with Google’s phase-out of third-party cookies can significantly impact Shopify and Shopify Plus eCommerce merchants’ digital marketing strategies. Here are some potential consequences:
  • Disruption of Tracking and Analytics: Many third-party analytics tools and marketing platforms integrated into Shopify stores rely on third-party cookies to track user behavior and conversions. Without compliance, merchants may lose visibility into customer journeys, conversion data, and the ability to measure marketing effectiveness accurately.
  • Reduced Advertising Capabilities: Ad platforms like Facebook and Google will be impacted by the loss of third-party cookie tracking. Non-compliant Shopify stores may face challenges with audience targeting, retargeting campaigns, and attribution modeling for their advertising efforts.
  • Legal Risks: Non-compliance with evolving data privacy regulations and Google’s guidelines could expose eCommerce merchants to legal risks, fines, and reputational damage due to privacy violations.
  • Decreased Competitiveness: Merchants who fail to adapt to the cookieless future may lose their competitive edge to compliant Shopify stores that have transitioned to first-party data strategies, contextual advertising, and privacy-centric solutions
  • Damage to Reputation: Non-compliance could lead to a loss of trust from users who value their privacy, potentially resulting in a negative impact on brand reputation and customer loyalty.
  • Degraded User Experience: If a Shopify site attempts to use blocked third-party cookies, Chrome may detect functionality issues and prompt users to re-enable cookies temporarily. This can lead to a degraded user experience, potential cart abandonment, and loss of sales.
To avoid these situations, Shopify merchants must adapt proactively to ensure continued success in reaching and engaging with their target audiences effectively.
iPhone on table with locked screen

A  Future Without Cookies for Shopify Merchants: Strategies for Compliance and Adaptation

In preparation for a web without the use of third-party cookies, Shopify eCommerce stores must proactively comply with evolving policies and adapt their marketing strategies and technical implementations. As a top Shopify agency with over 26 years of experience, InteractOne is a Shopify and Shopify Plus expert that can assist with managing the phase out of third-party cookies. Here’s how Shopify merchants can handle the changes with third-party cookies it:

Understanding the New Policies and Landscape

Start by conducting a thorough audit of current cookie usage. This process helps identify dependencies and understand the potential impact of Google’s phase-out on operations.

Implementing Alternative Tracking Methods

Investing in technologies that prioritize first-party data collection is essential for adapting to a cookieless future. Shopify offers several apps and integrations, such as Customer Relationship Management (CRM) systems and Customer Data Platforms (CDPs), that can assist in gathering and leveraging valuable first-party data effectively. Tools like Tealium are particularly effective in this area. Moreover, training teams on privacy-first marketing practices is crucial for compliance and building customer trust.

Experimenting with New Advertising Technologies

Experimenting with new advertising technologies, such as those proposed in Google’s Privacy Sandbox, can also help Shopify merchants explore alternative approaches to targeted advertising in a post-cookie era.

What are our best recommended alternatives?

  • First-Party Data Collection: Improve your Shopify website and digital tools to gather more data directly from users, such as through sign-ups, subscriptions, and interactions.
  • Contextual Advertising: Place ads based on the content of the web pages rather than personal user behavior to ensure ad relevance.
  • Server-Side Tracking: Move towards server-side tracking to rely less on cookies and enhance data privacy and control.
  • Customer Data Platforms (CDPs): Use CDPs to combine first-party data from different sources into detailed customer profiles.
  • Privacy Sandbox: Explore new technologies from Google’s Privacy Sandbox, which offers privacy-focused alternatives to third-party cookies.

Will GA4 reporting be affected for Shopify merchants?

Google Analytics 4 (GA4) is built to rely less on cookies and more on machine learning to fill in data gaps. Although the insights will differ from those based on third-party cookies, GA4 is designed to work well in a privacy-focused environment, so it will still be a strong tool for understanding site performance and user behavior without third-party cookies. Shopify merchants can seamlessly integrate GA4 with their stores to maintain robust analytics capabilities.

How will Shopify and Shopify Plus merchants run retargeting campaigns?

Shopify merchants can adapt their retargeting campaigns by using several effective strategies:

  • List-Based Retargeting: Use customer lists, like email subscribers, to target ads to people who have shown interest in your products.
  • On-Site Activity: Create retargeting strategies based on what users do on your own site, instead of their behavior on other sites.
  • Loyalty Programs: Promote sign-ups for loyalty programs to collect data legally and personalize marketing efforts.

Will social advertising become much less precise?

Without third-party data, social advertising might be less precise. However, social media platforms still have extensive first-party data from user interactions, allowing for effective targeting.

To keep targeted advertising effective on social platforms, use alternative data sources, such as hashed email addresses from known customers.

Steps for Preparation: Marketing Strategies and Technical Implementation

As for marketing strategies and technical implementation, Shopify stores can take the following steps:

Marketing Strategies

  1. Focus on First-Party Data: Prioritize collecting and utilizing first-party data from various sources like website interactions, CRM systems, social media platforms, and email marketing to personalize marketing efforts.
  2. Encourage User Logins: Prompt users to log in when visiting the store to gather valuable zero-party data, ensuring accurate tracking and personalized experiences.
  3. Invest in Data Collection: Gather information such as shopping behavior, purchase data, customer feedback, and market research to build robust visitor profiles for targeted marketing campaigns.
  4. Rethink Advertising Strategies: Shift towards contextual advertising that targets users based on the context of the content they are viewing rather than tracking individual behaviors. 

Technical Implementation

  1. Audit Third-Party Cookie Usage: Assess and understand the current usage of third-party cookies on the website to identify areas that need adjustment or replacement.
  2. Test for Breakage: Conduct thorough testing to identify any issues related to third-party cookies and ensure that the site functions properly without them.
  3. Implement Partitioned Cookies with CHIPS: Consider using partitioned cookies with Cookies Having Independent Partitioned State (CHIPS) to allow cross-site access while maintaining user privacy and preventing cross-site tracking.
  4. Utilize Storage Access API: Explore using the Storage Access API and related website sets as alternatives to third-party cookies for storing data on a per-site basis.

With the phase-out coming by the end of Q3 in 2024, eCommerce businesses must act quickly to adjust their marketing and technical setups to keep things running smoothly and to keep customers engaged. Failing to adapt could lead to lost opportunities and decreased customer satisfaction.

Silhouette of man standing in front of computer screen

The Role of First-Party Data in the Future of eCommerce Marketing

In the new world without third-party cookies, first-party data will become essential for eCommerce marketing. For Shopify merchants, this data will be the foundation for understanding customer preferences and behavior, allowing them to personalize and enhance the shopping experience while adhering to strict privacy rules. Building strong customer relationships based on trust, transparency, and value exchange will be crucial for thriving in a privacy-centric digital landscape. By prioritizing data privacy and adopting customer-centric strategies, businesses can foster loyalty and engagement, ensuring long-term success on the web without third-party cookies.

How Can Merchants Maintain Insights into Customer Behavior?

Many eCommerce businesses are now pondering: How can we maintain effective audience targeting and engagement without third-party cookies? Here are some strategies eCommerce merchants can consider:
  • Maximizing Enhanced Use of First-Party Data: Prioritize gathering data first-hand from customer interactions on your website, apps, and other owned platforms.
  • Transition to Contextual Advertising: Embrace contextual advertising, directing ads based on the content of the web page rather than past user behavior.
  • Leveraged Customer Relationship Management (CRM): Allocate resources to CRM systems for efficient management and utilization of first-party data in tailored marketing efforts.
  • Adopt Privacy-First Personalization: Develop personalization tactics that uphold user privacy, utilizing on-site behavior within a session to customize experiences without retaining personally identifiable information.

How can Shopify merchants adapt their digital marketing strategies to maintain personalized user experiences without relying on third-party cookies?

Without third-party cookies, Shopify merchants can maintain personalized experiences by harnessing the power of machine learning and AI to scrutinize first-party data. These technologies extract valuable insights into customer preferences and forecast behavior patterns. Furthermore, providing incentives for data sharing, such as access to exclusive content or discounts after a newsletter subscription, can further incentivize users to engage and share information.

How important will it be for eCommerce businesses to prioritize building direct relationships with customers to gather first-party data?

Building direct relationships with customers will be essential. These connections allow for gathering first-hand data, vital for customized marketing and improving customer experiences when third-party cookies are no longer available.

Without third-party cookies, Shopify merchants can maintain personalized experiences by harnessing the power of machine learning and AI to scrutinize first-party data.

Embracing a Privacy-Centric Future

In the end, navigating Google’s impending phase-out of third-party cookies presents a watershed moment for eCommerce merchants. It is crucially important to take proactive steps to comply with this evolving landscape, where the traditional pillars of digital marketing are undergoing seismic shifts. Shopify merchants must heed the call to action now, proactively preparing for the cookie-less future that lies ahead. By embracing alternative strategies and technologies, businesses can not only maintain the effectiveness of their marketing campaigns but also gain invaluable insights into customer behavior. As we embark on this journey towards a privacy-centric digital ecosystem, the time to act is now. Reach out to InteractOne for expert guidance and support in navigating Google’s regulations and ensuring compliance in this new era of eCommerce marketing. Prepare today to thrive tomorrow. Contact InteractOne and embark on your journey toward a cookie-less future.

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