Allowing invasive advertising to linger a little longer, Google now says they will not phase out third-party cookies until late 2023. Though for some advertisers, last month’s announcement is likely to seem like a welcome about-face on the search giant’s earlier plans to remove cookies “within two years of January 2020”, in reality, it is anything but.
Rather than signalling a reluctance to remove cookies, Google’s delay has more to do with their efforts to create a legally acceptable alternative. Specifically, Google is having difficulty convincing regulators such as the UK’s Information Commissioner’s Office (ICO) that its “privacy sandbox” is good for consumer privacy. However, while the outcome of what Google calls a “first-of-its-kind review” remains to be seen, the trends driving Google to remove cookies in the first place haven’t slowed. Instead, thanks to three critical trends, cookie use can still be said to be “crumbling.”
Consumers Are Taking Action on Privacy
While non-cookie-related controversies like the Facebook & Cambridge Analytica data scandal may have been what steered many people’s attention towards privacy initially, subsequent events have driven home the extent of online tracking targeting individuals. Even within crowded news bulletins, data breaches and overtly callous attitudes towards user privacy from tech giants still manage to grab headlines. Though not long ago, the average person may have associated the word “cookie” solely with baked treats, recent research shows that awareness of online tracking has skyrocketed.
Backing up this sentiment, research from the Pew Research Center reports that 81% of people feel that the risks of data collection by companies outweigh the benefits they receive in return. Tracking individual users across the web, third-party cookies are a clear antithesis to privacy for a concerned public. Critically, for the 52% of individuals who will abandon a product or service over data collection issues, awareness is also leading to real action. With greater use of digital technology since the pandemic only reinforcing this, for many people, online privacy, and by extension, third-party cookies, are now a core worry.
Regulators Are Waking Up
Though most governments were regrettably slow to respond to the erosion of personal privacy in the first place, regulators today appear eager to meet consumer demands for a cookie-free web. In a 2019 judgement, the Court of Justice of the European Union (CJEU) clearly determined that web users must actively consent to all analytics cookies when visiting a website. As annoying as the resulting barrage of cookie banners has been, regulators have responded to their misuse with significant financial penalties for offenders — a critical step in encouraging real change.
With the General Data Protection Regulation (GDPR) leading the way, regulators elsewhere are following suit and pushing cookies out of the web’s future worldwide. In California, the recently passed California Privacy Rights Act (CPRA) adds a similar “opt-in” requirement for cookies within the world’s sixth-largest economy. Similarly, Brazil’s Lei Geral de Proteção de Dados (LGDP) also places GDPR-esque restrictions on cookie use while globally, comprehensive data protection legislation is also in train everywhere from China to New Zealand. This groundswell of legislation means that, within the near term future, all of the world’s biggest markets will restrict or complicate cookie usage to some degree. With only around 10% of users likely to consent to third-party cookies, the role of cookies in online advertising will consequently face rapid decline.
Proactive Publishers Are Already Placing Cookies at Arms Length
For any publisher planning their revenue streams for the medium-term future, trends like those outlined above may make cookies appear more like an obstacle than an asset.
Looking at cookie support across the publishers who work with AirGrid, we can already see how these trends are changing the industry status quo. Our data (outlined in the graph below) shows a clear downward trend in the percentage of cookie supporting traffic. With consumer trends, regulatory pressure, and shifts in industry practices continuing, we expect this trend to continue at pace, regardless of delays to Google’s approach.
And although Google is dragging its feet, most web browser providers are already getting ahead of this shift in publisher and web user preference. Both Firefox and Safari have recently turned off third-party cookies by default. As a result, rather than changing the game when it comes to cookie usage, Google is merely responding to industry-wide trends that are already shunting platforms, publishers, and advertisers away from cookie dependency.
Cookie Use Is Ending, But Personalisation Isn’t
As regulations, consumer preferences, and declining support push cookie use towards a cliff edge, monetising content online or targeting audiences with third-party data naturally becomes more challenging. Fortunately, however, the decline in cookies also presents a silver lining — the rise of first-party data.
As they face up to a future where collecting, sharing, or holding third-party information is a significant liability, advertisers and publishers alike simultaneously gain access to a new paradigm of first-party data provided directly by consumers who also benefit from doing so. Rather than being an encouragement to anyone trying to push back against the privacy’s incoming tide, Google’s delay instead forms a wake-up call that change is inevitable. In the next decade, privacy will have to become part of the online experience.
About AirGrid
AirGrid is a privacy-first audience platform.
Our vision is to make web ads more private, by allowing people to retain control over their own data. We do this by shifting the audience modelling to run directly on the individual’s device.
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