Evelyn Mukherjee

The current landscape of digital advertising is about to change upon Google’s announcement to remove cookies from their popular browser, Google Chrome. As leaders in the advertising industry, Google’s third-party cookie removal has put many advertisers and companies into a frenzy of finding new cookieless advertising methods. This choice was inspired, or rather pushed, by a majority of consumers’ increased frustration, mistrust, and confusion with data collection and usage on the company’s end. Consumers interact with cookies on an almost daily basis, but are not aware of what comes with clicking the “Accept Cookies” button. Companies are collecting and selling user data, many times unbeknownst to the user, and give little to no information to consumers on what they are doing with the collected data. While third-party cookies are integral to many advertising companies in order to provide insight into their consumer’s online behavior and provide tailored advertisements to users that could lead to increased conversion rates for the company, it comes at the cost of leaving consumers in the dark with where their data is going and how it is being used. Concerns from consumers are starting to rise, and trust in large companies is decreasing. It is crucial that Google uses its influence as a large company to empower the consumer and their privacy in their pursuit for creating new advertising methods, as it is owed to the consumer to be more aware of their online presence and how third-party cookies are affecting them. The practice of data collection is a highly debated topic surrounding user privacy and data protection, and it’s important to first look into the large ambiguity that comes with privacy policies and data collection transparency on the user’s end.

The first step to data collection is through the user’s browser with the help of cookies. Data is typically collected online using small text files called “cookies”. Cookies can collect information and activity on pages you have visited, save your usernames and passwords, save items in your cart, deliver targeted ads, and customize your overall web experience by saving preferences on websites even when you close out of them. There are three main categories of cookies many users interact with on a regular basis: persistent cookies, session cookies, and third-party cookies. Third party cookies are the most controversial, as they collect your data and send it to various different locations, many times unbeknownst to the user. Despite being the most controversial, advertising companies rely heavily on the user data provided by third-party cookies in order to target advertisements properly.

Ironically, the purpose of cookies created in 1991 by Lou Montulli was to protect the user’s privacy while saving their progress on different websites. Cookies were designed to create a personalized web experience between the user and their server, with no intention of the stored data being shared. It wasn’t until advertisers realized they could look at the back end of websites and their HTML to view cookies and the data stored in them. One of the first companies that realized they could see data stored in a cookie was an advertising company called Double Click, which was later bought by Google in 2008.

As consumers are becoming more concerned and confused with where their data is going, there have been many federal and state acts that have been created in an attempt to combat this problem. Currently, California is the only state with a privacy protection act that closely resembles the General Data Protection Regulation in the EU. The California Consumer Protection Act gives residents the rights to know what data is being collected, whether it is being sold and if so to whom, access to their personal data, the right to say no to their data being collected, and the right to equal services and prices regardless of whether they exercise their privacy rights or not. Following suit, Utah, Colorado, Virginia, and Connecticut are currently the only other states with legislature. On the federal level, the American Data Privacy and Protection Act is the most recent privacy protection act introduced on July 20, 2022. If signed, this act will give consumers more autonomy over their data, including the rights to view, edit, and opt out of targeted advertising on the websites they visit. Websites will be required to give a notice to consumers about their cookie policies, as well as give them the option to change their cookie settings or opt out of data collection on the website altogether.

Privacy policies and data collection are now a part of our everyday life – whether it’s scrolling on a news or social media website, shopping online, or even creating an email account – our data is being collected and shared with the website hosts and others if the company collecting our data sells it to other parties. While 81% of Americans agree to privacy policies presented to them on a monthly basis, only 22% read a majority of them. 13% of people understand a great deal of what is being said in privacy policies, while 55% only understand some of what is being said. In a cookie policy readability study done by Elizabeth Rawlings, the average reading level of adults Americans between the 7th and 8th grade reading level, while the average reading level needed to understand privacy policies is 12th grade level.

There are two main forms of advertising that are largely used amongst companies to precisely target their audience. There is third-party advertising, or behavioral advertising, which is the advertising method surrounded by high concerns of lack of privacy, and there is contextual advertising. Third-party advertising relies heavily on data collected from third-party cookies, while contextual advertising relies on the user’s browsing history and first-party cookies. Both methods have proven to be successful, but both still require a certain amount of data from the user’s end. A benefit of contextual advertising is its use of machine learning and AI, which helps to predict which advertisements the user would want to see based on their past browsing history. While contextual advertising is praised for taking less data from the user, there are still many concerns surrounding contextual advertising, as it does also take into account the user’s location and IP address, which threatens the safety of the user’s personal information. Additionally, contextual advertising is heavily reliant on the progress of machine learning, making it a risky alternative as it develops further. While Google specifically has relied on third-party cookies to help companies target their advertisements, they have started to use contextual advertising as inspiration for replacing their current third-party data collection method. Despite contextual advertising being a main method in advertising, it is interesting to see Google’s struggle with developing a cookie-less method which could be due to the scale of their Google AdSense and Analytics business.

Concerns demonstrated by many online consumers include the general ambiguity surrounding data collection, a lack of control over where their data goes and who it is shared with, as well as the limited transparency from companies that have the ability to collect their data. If large companies wish to create a new method of targeted advertising, it is extremely important they take into account the concerns and frustrations expressed by consumers, as they are the industry leaders in advertising with many advertising companies and businesses relying on advertising products provided by large companies such as Google or Meta. Consumers in general have demonstrated a low level of understanding when it comes to their online privacy, leading to higher concern levels and increased frustration. As important as it is for big companies to increase transparency and trust in the data collection process, it is just as important that consumers find tools necessary to educate themselves on their rights as consumers, data privacy, and how they can protect themselves in this age of surveillance capitalism. With both working hand in hand, we could create a new age of digital advertising that is trustworthy, transparent, and less ambiguous to the average consumer.