In 2020, Google announced they stop the acceptance of Third-Party Cookies on Chrome. The roll-out of the same was delayed until 2025. In July 2024, Google announced that they had canceled the plan to phase out Third Party Cookies. This was initially rolled out to give more emphasis on First Party data collection and to continue the testing of Privacy Sandbox as an alternative which provides the balance between fulfilling advertisers requirements and maintaining the privacy of consumers.
To draw a basis comparison between First Party and Third-Party Cookies, First Party Cookies are the ones that are collected when a user is using your website while the Third-Party Cookies are collected when a user is using someone else’s website or a Third-Party website. The First Party Cookies are used to retarget existing or a potential customer that has visited your website while the Third-Party Cookies are used to target user behavior across multiple websites. Though First Party Cookies are more complaint to user privacy and lead to better conversions, Third Party Cookies provide better consumer insights.
Google faced the dilemma of disappointing the marketers to enhance user privacy. Over 61% of marketers did not even believe that Google would go ahead with implementing Privacy Sandbox.
Privacy Sandbox was initiated in 2019, as the digital businesses were rising consumer privacy became a critical point of evaluation. The aim was to restrict cross site and cross app tracking while providing access to the data points of the customer journey on the marketer’s website.
Some Key Features of Privacy Sandbox were:
- Provide users with more control handles that will help in maintaining their privacy
- Make the businesses shift to First Party Cookies
- Developing and setting better privacy standards for the industry
- Provide free access to common web usage data that supports businesses
Google ran testing in 2024, and the results were quite promising, they tracked the numbers for Ad Manager and Ad Sense users and used them in situations where Privacy Sandbox was available. With the Privacy Sandbox, both the platforms faced a drop in programmatic revenue, for Ad Manager it was 34% and for Ad Sense it was 21%. Though the drop seems significant but compared to the security and privacy that it provides to the customers, it does not seem that huge.
The phase out of Third-Party Cookies was canceled by Google as their primary revenue generators, and the advertisers displayed their concerns. According to them, the results were significant enough and providing enhanced privacy to the users at the cost of taking a revenue hit did not seem worth it, according to them, going ahead with Privacy Sandbox would restrict the data collection capacity and will disrupt personalization of advertisements. Further concerns were raised by the regulators, particularly the UK’s Competition and Markets Authority (CMA) and the Information Commissioner’s Office (ICO). Some of their major concerns were that this would lead to an anticompetitive market and would give Google sole control over data collection and availability.
Furthermore, this would raise concern about insufficient disclosure of data collection practices that will further be used by Privacy Sandbox. The data points that will be available to the marketers will be very broad to draw any specific insight that is relevant for the businesses to have an edge over their competitors.
Though Google is taking the initiative to provide better controls to their customers to manage their privacy, but they clearly over-committed to delivering a zero-cookie internet experience. Website users should anticipate more control over their online privacy as Chrome adds more privacy control features and Privacy Sandbox continues to evolve. Meanwhile, advertisers need to explore new tools and strategies to find new ways to engage with their target consumers.
