Benefits of first-party data: Spot-on marketing, fantastic results
With the rise of the privacy-first web, marketers need to focus on harnessing the power of first-party data for gaining competitive edge.
For a few years now, Google planned to eliminate third-party cookies from its Chrome browser. But the search giant kept extending the deadline, and on Monday, announced that it’s dropping the plan entirely.
Google decided to scuttle the plan, part of its Privacy Sandbox initiative to boost online privacy, after conducting tests and receiving feedback from advertisers, regulators, publishers, and others.
The change would have required a lot of work by many stakeholders and impacted “everyone involved in online advertising,” Anthony Chavez, VP of Google’s Privacy Sandbox initiative, wrote in a blog post.
“In light of this, we are proposing an updated approach that elevates user choice,” he wrote. “Instead of deprecating third-party cookies, we would introduce a new experience in Chrome that lets people make an informed choice that applies across their web browsing, and they’d be able to adjust that choice at any time.”
Google didn’t offer details about its new approach, but said it’s discussing the plan with regulators and will engage with the industry on it.
Google’s long cookie saga comes to an abrupt end
Back in 2020, Google had originally planned to eliminate third-party cookies by the end of 2022, but faced a lot of regulatory challenges and pushback from the advertising industry. It extended the deadline several times, with the latest shift to 2025.
The UK’s Competition and Markets Authority, which was reviewing Privacy Sandbox, said Google now will introduce user-choice prompt, which will allow users to choose whether to retain third-party cookies.
In a blog post, the agency said it will carefully consider Google’s new approach and welcomes comments on it, including possible implications for consumers and market outcomes.
Google said developers still need privacy-preserving alternatives to third-party cookies.
“We’ll continue to make the Privacy Sandbox APIs available and invest in them to further improve privacy and utility. We also intend to offer additional privacy controls, so we plan to introduce IP Protection into Chrome’s Incognito mode,” Chavez wrote.
Cookies live on: Reprieve for marketers? Not so much
Marketers and advertisers who relied on third-party tracking cookies for consumer insight may be breathing better after Google’s reversal.
But most marketers are well aware that consumer demand for greater online privacy isn’t going away. Privacy regulations and controls continue to grow, including California’s Consumer Privacy Act and Apple’s move in 2021 to boost iOS privacy with its AppTracking Transparency framework, which requires apps to ask users for permission to track them.
Many have already been shifting away from reliance on third-party cookies to focus on their first-party data — the data they’ve collected directly from their customers.
“Since 2020, the industry has become less reliant on cookies as consumers became more privacy and data right aware,” said Ratul Shah, BTP platform product marketing at SAP. “A strong first-party data strategy still offers a path to personalization based on trust.”
Liz Miller, VP and Principal Analyst at Constellation Research, told us that the Google news “should be a rallying cry for marketers to stay the course when it comes to data that more immediately and directly connects brands to their buyers.”
Third-party cookies have their place in ad operations and optimization, but “we’re not in a time where we can afford to move backwards in what we know, the relationships we build, and the customer intelligence we collect,” she said.
There’s a difference between privacy and safety, Miller added: “Privacy puts the control of engagement and the value exchange of customer data in the hands of the customer. Safety is the promise that the data that is exchanged is secure and used responsibly and to the benefit of both parties involved in the exchange. They are not the same and marketers have the opportunity to take advantage of that difference.”
The Content Marketing Institute’s Robert Rose said Google’s decision may be just a short-term reprieve for marketers:
“Google’s reversing course about third-party cookies does NOT minimize the importance of getting your first-party data house in order. It does mean personalization based on consumption data across social media, websites, and other media is here to stay.”
Google reversal viewed as a step back for consumer privacy
Consumer privacy advocates and watchdogs criticized Google’s decision to let cookies live on in Chrome. The UK’s Information Commissioner’s Office (ICO) said blocking third-party cookies would have been a positive step for consumers.
“The new plan set out by Google is a significant change and we will reflect on this new course of action when more detail is available,” the agency wrote on its blog.
“Our ambition to support the creation of a more privacy friendly internet continues. Despite Google’s decision, we continue to encourage the digital advertising industry to move to more private alternatives to third party cookies – and not to resort to more opaque forms of tracking.”
Electronic Frontier Foundation Staff Technologist Lena Cohen said Google backtracked on its privacy promise while Safari and Firefox have blocked third-party cookies by default since 2020.
“Google’s announcement underscores their ongoing commitment to profits over user privacy,” Cohen said in a statement to the Future of Commerce.
Third-party cookies enable advertisers and data brokers to collect and sell information about user online activities, which can lead to harm like bad actors buying sensitive data, Cohen said.
“With nearly 80% of Google’s revenue derived from online advertising, it’s clear why Chrome is putting advertisers’ interests above users’ privacy,” she said.
