Google’s announcement on Monday that, on second (or third) thought, it won’t kill third-party cookies in Chrome after all has left the industry grappling with a slate of unanswered questions.
Google now says it will introduce new browser-level controls so users can opt in to cookie tracking – or not. But nobody, not even inside Google, apparently, knows how these controls will work in practice.
Advertisers fear an Apple ATT-esque universal prompt that discourages consent for tracking. That approach essentially ended Apple’s mobile ad ID as a viable targeting and measurement signal, since most users decline to opt in to tracking.
If Chrome imitates Apple, there may be a de facto deprecation of the third-party cookies as a viable signal, too, since potentially only a slim percentage of users would consent to tracking. In that case, advertisers would still have to primarily rely on cookie alternatives, including the Chrome Privacy Sandbox.
AdExchanger spoke to industry experts about their most urgent questions for Chrome.
Cookies or Sandbox?
By far the biggest open question is to ask for more clarity regarding the new consent prompt or interface that users will see.
“This is all about the user experience and defaults,” said Paul Bannister, chief strategy officer at Raptive. “When we have more information about that, we can all make some better decisions about the future.”
There are several possibilities for how Chrome’s consent interface will look, said Jared Siegal, founder and CEO of Aditude. It could be akin to a mandatory consent management platform pop-up, which are ubiquitous in Europe now as a GDPR consent mechanism. The new consent tools might also be buried within the settings menu, as the current privacy controls are, and make it the user’s choice to toggle new options. The language allowed in the prompt itself could also make a huge difference in terms of collecting opt-ins.
All the experts AdExchanger spoke to agreed that Google must carefully balance its competing interests in the design of its own new interface. The ad tech business may want to steer users toward opt-ins, but addressing privacy concerns means less tracking overall and thus encouraging more opt-outs. But more opt-outs also should spur wider use of Chrome’s Privacy Sandbox APIs.
“One thing is for sure: There will be a correlation between the aggressiveness of UX update and the extent to which Google is incentivized to see Privacy Sandbox succeed,” said Stephen Caffrey, CEO of display.io and Founder of Sponsorcart.io.
Basically, the Privacy Sandbox can only succeed with broad adoption among publishers, advertisers and ad tech. If cookies remain viable, execs from those categories expect programmatic companies to cling to what they know, especially since the Sandbox underperforms cookie-based campaigns in all tests (even Google’s).
If Chrome’s new UX is geared toward getting users to opt out of third-party cookies, and it rolls out by early next year, then “Privacy Sandbox adoption won’t suffer too much,” said Bosko Milekic, chief product officer and co-founder of Optable. But if the UX doesn’t steer users toward opting out, Sandbox adoption might not reach critical mass among publishers and advertisers.
Opting out
All that being said, there’s no guarantee that Chrome’s new interface will even have a consent prompt.
Currently, about 40% of Chrome users have opted out of cookie tracking in some form by using the existing privacy settings, said Joe Root, co-founder and CEO of Permutive. And that’s with no universal prompt.
But a universal consent prompt for individual sites, or one that asks a user one time whether to block all third-party cookies, could result in a massive drop in addressability on Chrome.
“If it’s an unmissable prompt, expect ATT-like opt-out rates,” said Caffrey. “If it stays buried in settings, it will be a nothingburger.”
ATT-like opt-out rates would be disastrous for most web publishers. As of Q2 last year, the average rate of opt-ins for iOS users was just 34%, according to Adjust.
Meanwhile, Criteo, which has been a Privacy Sandbox tester since the earliest days of the solution, recently reported an average of 60% reduction in publisher revenue on Chrome when third-party cookies aren’t present.
And publishers have few opportunities to incentivize opt-ins for tracking or make their pitch clearly, since the opt-in is likely to happen at the browser level, not at the site level.
“While opt-in rates from web publishers have been higher – ranging from 60% to 70% – we don’t expect consumers to have the same trust in browsers,” said Mathieu Roche, co-founder and CEO of ID5. Plus, he added, the cookie conversation has officially gone mainstream, meaning general audiences are much less inclined to opt in to cookie tracking than they would have been a few years ago.
Clearly, there’s plenty for publishers to potentially worry about – although that’s par for the course.
“This announcement is another example of upheaval that publishers face in this landscape, and the lack of transparency and unequal access to guidance widens the disadvantage gap for smaller publishers,” said Amanda Martin, CRO at Mediavine.
“However, this announcement allows us an even longer runway and greater opportunity as we transition to a post-cookie world,” she added.
And there’s always a chance Chrome’s opt-in rates won’t be as bad as those on iOS.
“I am optimistic that the consent dialog and defaults will be much more reasonable and pro-competitive as opposed to what Apple did with ATT,” Bannister said. “The involvement of the UK’s Competition and Markets Authority as well as Google’s engagement with the larger industry would indicate this is more likely.”
Because the exact format and phrasing of Chrome’s new UX will have an outsized impact on opt-in rates, we can “expect to see a lot of haggling by industry stakeholders regarding the details of this new experience for user choice,” said Ian Trider, VP of product, DSP, at Basis Technologies. “Naturally, ad tech companies will want this to be done in such a way that leads to higher opt-in rates.”
Why the pivot?
One question for Google is pretty basic: Why? After four years of tough work, why reverse course now?
Most experts agree Google simply can’t balance the prerogatives of the Privacy Sandbox (i.e., less third-party tracking or cross-site tracking) with regulators’ requirements to not cause upheaval in the online ad industry or raise anticompetitive concerns.
By decoupling the Privacy Sandbox and third-party cookie initiatives, the Privacy Sandbox can move forward with less pressure to stick to a predetermined schedule, which makes development of a successful product more feasible, said Myles Younger, head of innovation and insights at U of Digital. Plus, the “tiresome cookie deprecation timeline drama” goes away, shifting industry attention to the Sandbox’s viability, he said.
Increased attention on the Sandbox could be a good thing, considering most experts who spoke to AdExchanger consider it an unsatisfactory stand-in for cookies.
“It’s a very complicated solution that the average publisher would never be able to support,” Siegal said. “It may inadvertently give Google even more control over the auction, defeating the purpose of what regulators want. And the [negative] revenue impact is too large for publishers, Google and everyone involved.”
Plus, by shifting the burden of opting out of cookies to the end user, Google has successfully avoided being branded as “Cookie Killer” by the ad industry, while protecting itself from regulatory liability, according to Caffrey.
After all, he said, “how do you legislate against the choice of the end user?”
What next?
So where does the industry go from here?
Most experts agree that Google’s pivot isn’t an excuse to stop investing in post-cookie solutions.
Now, instead of cookies being removed by Chrome, they’re likelier to be removed by the users themselves, said Roche. Which leaves the industry in the same place it was before Google’s announcement.
“The advertising ecosystem still requires multiple solutions to safely and effectively target consumers, including alternative IDs, server-side solutions, Privacy Sandbox and cookies,” said Anthony Katsur, CEO of the IAB Tech Lab. “This isn’t materially different from what is happening today, as approximately 25% of the browser market is already cookieless.”
And regardless of the lingering questions about Chrome’s new consent interface, the announcement actually puts the industry on more solid footing than before.
“Honestly, I’m happy with this latest curveball, because it puts an end to the constant delays and uncertainty,” Bannister said. “This really seems like a workable plan for the first time.”
