The ripples around Google’s announcement on Wednesday show the need for clarification on their approach to user-level identifiers next year.
Google’s announcement
In Google’s blog post on Wednesday, they provided clarity on what a “privacy-first web” means to them. Specifically, it:
- Confirmed that they will not support alternative user-level identifiers once third-party cookies are phased out of Chrome;
- Reiterated their focus on privacy sandbox initiatives such as federated cohorts of learning (FLoC) as the way to balance targeting precision with user privacy;
- Reiterated support for first-party data activation (specifically “first-party relationships on our ad platforms for partners, in which they have direct connections with their own customers”).
What does this mean for the industry?
On the one hand, this has provided much-needed clarity – Google isn’t, and will not, build an identity solution like The Trade Desk’s Unified ID 2.0.
The commitment to first-party data also suggests that tools we rely on to provide relevant marketing and build lookalike audiences – like Customer Match – will continue to function within the Google ecosystem.
However, some of the commentaries around this announcement has raised concerns that this consolidates yet more power in Google. And that the commitment to “privacy” is really a smokescreen for building more walls around their digital footprint. In many ways, Google is in a difficult position; more privacy control for consumers means less – or different – data for advertisers. And as the biggest player in this space, whatever they do will come under scrutiny.
What it does seem to mean though, is that for those brands who want to continue to have a detailed understanding of their audience’s digital marketing interactions, the only way to do this at scale will be to use Google’s products. And for the providers building alternative ID solutions, they have now lost access to a large market – no Google product will accept it. This negative view has been seen in the stock markets, with The Trade Desk’s share price down by 20% at time of writing.
And while the rest of the industry can shift on to first-party data, FMCG/CPG verticals in particular don’t have that adaptation available to them and may find it difficult to reach very targeted and relevant audiences. Finding a balance between Google’s scale, reach and rich data, and innovations in contextual targeting and omni-channel experiences will be critical.
How to get privacy-ready
This announcement is a clarification rather than fundamental change of direction. And, crucially, the statement didn’t really give much detail on what’s coming next.
Google has confirmed that first-party data solutions are not going to break. So, in the absence of further detail we are continuing to work with clients to ensure they are “privacy ready”. This means adopting best practice data capture strategies, building first-party relationships with consumers where possible, testing ways to activate that data and developing measurement methodologies in preparation for 2022.
Fundamentally, this comes down to having the solution that works for your audience. If your consumers are primarily using the Google ecosystem, testing FLoC cohorts and adopting Google’s solutions make sense. Our team look forward to working with Google and our clients to test the FLoC cohorts as they are made available to advertisers in Google Ads in Q2.
But for those brands that engage with audiences primarily on the “open web” (i.e. engage with audiences across a range of buying platforms and networks beyond Google), now is the time to think about the alternative solutions which will offer the same level of privacy compliant targeting as Google (albeit with a different technical solution).
Being “privacy ready” will allow brands to adopt the solution that is right for them and their audience as they develop. Until then, we will continue to monitor developments and work with our ad tech partners to ensure that our clients can deliver the best marketing experiences to their customers.
To find out more, or get access to ad operations support at Croud, get in touch.
