What The FLoC? Google Vows To Stop Tracking Users For Ads

New York, New York. - May 27, 2017: Google sign outside the Google office in New York City. It is a multinational technology company specializing in internet services and products.
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Google has told the ad tech industry that privacy will be king, as the tech giant prepares to finally deprecate third-party cookies on Chrome.

In an announcement overnight, Google confirmed it would not be using alternative methods to track users online once third-party cookies are deprecated.

Google’s director of product management, ads privacy and trust David Temkin made the position clear in a blog.

“Today, we’re making explicit that once third-party cookies are phased out, we will not build alternate identifiers to track individuals as they browse across the web, nor will we use them in our products,” he said.

Temkin added that Google had been looking at the alternative ad tracking methods proposed by other ad tech players.

“We realize this means other providers may offer a level of user identity for ad tracking across the web that we will not — like PII graphs based on people’s email addresses,” he said.

“We don’t believe these solutions will meet rising consumer expectations for privacy, nor will they stand up to rapidly evolving regulatory restrictions, and therefore aren’t a sustainable long term investment.”

Privacy rules

Google says the changes are all about creating a “privacy-first world” while also ensuring the web remains open and free for users.

It also promises that advertisers will still be able to deliver targeted and effective campaigns without sacrificing user privacy.

While some companies have put forward proposals to track users using hashed email addresses, Google’s latest changes will not ‘follow’ users as they browse across sites and will not build user-specific profiles, rather all advertising will be driven by privacy-preserving APIs, which are currently being developed within Google’s Privacy Sandbox.

“Advances in aggregation, anonymization, on-device processing and other privacy-preserving technologies offer a clear path to replacing individual identifiers,” Temkin said.

“In fact, our latest tests of FLoC [interest-based advertising] show one way to effectively take third-party cookies out of the advertising equation and instead hide individuals within large crowds of people with common interests.”

Google revealed earlier this year that FLoC advertising was returning a 95 per cent conversions per dollar spent when compared to cookie-based advertising.

What is interest-based advertising?

FLoC [which is short for Federated Learning of Cohorts] identifies users with similar browsing behaviours to build cohorts for advertisers. This means all targeting is based on cohorts, rather than individuals, meaning personal data is always preserved.

On-device processing is used to keep web history private on the browser.

For Google, this approach is all about giving users a greater sense of transparency and control when they access the web. Users should be able to know why they have seen a certain ad and have the tools to change it if they desire, the company says.

Advertisers will be able to use FLoC-based cohorts in Google Ads in Q2 this year.

First-party data relationships

While advertisers have been preaching the importance of first-party relationships with customers for years, with these latest changes, first-party data will be essential for advertisers.

“We will continue to support first-party relationships on our ad platforms for partners, in which they have direct connections with their own customers,” Temkin said.

“And we’ll deepen our support for solutions that build on these direct relationships between consumers and the brands and publishers they engage with.”

These first-party data relationships should work in tandem with FLoC advertising to allow advertisers to reach relevant audiences at scale.

The bottom line for advertisers?

For advertisers, the changes the biggest change will be around how they collect first-party data.

With FLoC advertising currently promising 95 per cent of what cookies have offered, advertisers will be able to make up the difference (and more) with consented customer data that allows them to have direct conversations.

Temkin said that these changes can help the industry move towards a privacy-first advertising ecosystem.

“We remain committed to preserving a vibrant and open ecosystem where people can access a broad range of ad-supported content with confidence that their privacy and choices are respected,” he said.

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