My VPN service offers not only IP hiding and encryption via a desktop client but also an internet browser extension that is optional. Assume a person is using the VPN via the desktop client but not the optional browser extension. I want to understand the incremental value of the browser extension.
The quote is from a FAQ from the VPN service's website.
What does the browser extension do?
The browser extension provides a "Lite" VPN client, which does the same thing as the desktop one, but only in your browser. Any other applications you may be using on your computer will utilize your ISP provided IP address. Additionally it blocks thousands of ad beacons and trackers that could follow you across the websites you visit, and compromise your privacy even if you are already using a VPN. It also blocks various "social widgets", such as Facebook Like buttons, Twitter badges, etc, which are embedded into millions of websites and report all your activity to their respective companies. It also rotates your user agent (which identifies your browser), which further scrambles your online activities in the eyes of whoever is watching.
Why should I use both products?
Contrary to popular belief, a VPN client alone will not keep you anonymous or significantly help your privacy online, unless you take extreme measures, at which point using the Internet becomes a burden. Anonymous IP address alone provides some protection, however marketers, criminals and governments have stepped up their game which allows them to track you even if you already use a VPN. In order to combat this, browser level protection is also necessary to improve your chances of staying anonymous.
The FAQ describes "ad beacons and trackers that could follow you across the websites you visit". Then it describes "social widgets" that "report all your activity to their respective companies".
To use the phrase "report all your activity" seems an exaggeration which lowers the reader's confidence in the FAQ. For example, it seems doubtful that Facebook can determine my gmail password if I use gmail concurrently in the same browser. If the FAQ means to say that all your identifiable (meaning traceable to an individual) Facebook activity is visible to Facebook algorithms, it is not clear why that is even a privacy violation.
The statement about ad beacons and trackers is more worrying but it is not explained how "following you" is a privacy violation. What is the mechanism by which ad beacons and trackers disclose identifiable activity/information/clicks and to whom is it disclosed to, if in fact this happens. Is identity actually disclosed or is the disclosure merely that, for example, "somebody possessing a subscription to the Daily Planet newspaper website subsequently clicked an ad showing Zoom branded size 7.5 running shoes for women placed by the Gotham City Shoe Store". In other words the disclosure is information from which inferences can be made about identity without actually identifying a single individual. This might not be the most worrying example and it may not even be a feasible example.
What is the mechanism that enables traceable-to-an-individual privacy violation that can motivate use of the browser extension? You should assume that the other VPN services are applied so we are looking for the incremental value of the browser extension.