Google’s user registration crackdown has advertisers bracing for change

Advertisers use data collected while people browsing the Internet to find out who to show an ad to and whether that person subsequently purchased the advertised product. After the change from Google, neither of them can get as detailed a picture of it.

“In a way, you lose the ability to track and measure behavior as we have come to expect,” said George Popstefanov, CEO of digital advertising agency PMG. However, he supports the change, which he believes is better for the consumer. “I think our ability to track and measure will change, but I don’t think it will get any worse,” he said.

Scott Hagedorn, CEO of Omnicom Media Group, a collection of media agencies, said Google’s privacy change is part of an inexorable trend that the company has long been preparing for. “We’ve had plans for it for 10 years,” he said, describing the change as seismic.

In recent years, this preparation has meant testing ways to work directly with major tech platforms like Google without looking at personally identifiable data. Google’s latest move will accelerate this kind of dynamic, Mr. Hagedorn said.

Others in the industry saw Google’s move as an anti-competitive seizure of power. “This is Google unilaterally trying to define the privacy standards for the Internet,” said John Nardone, CEO of Flashtalking, an ad server company. “It is not appropriate.”

Google is proposing its own technologies that it says will achieve many of the same things that advertisers tried to achieve by tracking web users down to the individual level, but in a way that better respects consumer privacy.

These include tools that promise to group consumers on their devices into interest groups or cohorts and never send their browsing data to a central server. Google has claimed that these tools have performed almost as well as the existing ones – which are tracking consumers individually – and is starting to open them up to industry testing.

PMG’s Mr Popstefanov said it is too early to determine how well they really work. “Will it be as good as what we have? No. It is too early to say whether it will give us the insight we need. “

Advertisers will have to decide if they’re comfortable with Google’s new approach to ad targeting, which will be less accurate. “If you can target individuals precisely, your effectiveness is very high,” said Raja Rajamannar, head of marketing and communications at Mastercard.

“If you do it in cohorts, it will undoubtedly be less than the individual, but we don’t know how much less at the moment.” He said it would take time to decipher the impact of Google’s plan.

Ad executives said companies that have a lot of first-party data – information they’ve collected about their own customers, such as through apps or loyalty card programs – will be in a stronger position to run accurate digital ad campaigns.

Companies that don’t have a lot of first-party data or whose business models focus on acquiring new customers versus marketing for existing ones will face challenges, according to John Lee, chief strategy officer at digital marketing firm Merkle.

“You don’t have this stool anymore,” said Mr. Lee. “You must use data from the first party.”

Due to the potential weakness of Google’s replacement, some ad executives believed the move created an opening for other industry players who have been working on alternative technology to track users in a privacy-safe manner.

“I see this as an important statement of opportunity for the rest of the ad ecosystem,” said Paul Silver, global chief strategy officer at MiQ Digital, a company that helps agencies buy media.

Advertisers who want to target users individually on different websites can do that – just not with Google’s advertising tools, said Mr. Silver.

The Trade Desk, a company that makes tools for advertisers, proposed a technology that would create identification data for users based on their emails; the plan is currently under review by the Partnership for Responsible Addressable Media, an advertising industry group.

PRAM has tried to work with Google to create privacy-safe identifiers that would work in Google’s Chrome browser after cookies are deleted.

While Google’s announcement on Wednesday appeared to be targeting these kinds of fixes, Google hasn’t yet considered whether the fixes PRAM is pursuing will work in Chrome when cookies disappear next year. Google’s Chrome has a dominant share of the web browser market.

“We are disappointed that Google did not work more closely with the industry before announcing its plan,” said Bill Tucker, executive director of the PRAM project. “But we believe this represents a critical opportunity for future collaboration.”

Other agency executives agreed with Google’s assessment in a blog post announcing the change on Wednesday that individualized user registration is unlikely to survive future privacy regulatory measures.

“Like it or not, even if you can find ways to deliver patches and move forward, legislation will kill those patches,” said Simon Poulton, vice president of digital intelligence at Wpromote.

Write to Keach Hagey at [email protected] and Alexandra Bruell at [email protected]