Google is betting on its logged-in user base to replace third-party cookies: A Q&A with Goodway Group’s Rober Webster and Anonymised’s Mattia Fosci

Which is precisely why Digiday contacted Rob Webster, global vp of strategy at digital marketing consultancy CvE, and Mattia Fosci, CEO of privacy-focused ad tech platform Anonymised. They’ve helped make sense of Google Ads Data Manager (GADM), which is being made available in Google Ads later this year.

But before we dive headfirst into their breakdown, let’s peel back the layers on what GADM actually is: According to Google, it’s supposed to make sharing your first-party customer data (the stuff that’s like the crown jewels of marketing — online and offline sales, plus personal tidbits like names, email addresses, phone numbers and even home addresses) with Google’s platform a breeze.

Google then takes this treasure trove of data, stirs it into their own media data and mixes it up with Google log-in info, like a mad scientist brewing a potion. The result? They use it to target ads and measure campaign attribution like a digital sorcerer.

Specifically, GADM builds upon and expands two Google products:

• Customer Match allows Google to match advertisers’ first-party customer data with Google Account data and publisher data using the new EPID features. Once matched, Google uses the data to drive targeting, retargeting and lookalikes within its first-party properties (YouTube, Gmail, Google Discover, etc.) and on millions of third-party websites. For instance, an e-commerce site can create a segment of customers with higher Lifetime Value and target them with personalized messages (retargeting), or that data can be used by the bidding model for optimized segment on Display Discovery and Video Action Campaigns or audience expansion for Video campaigns with “Product and brand consideration” or “Brand awareness and reach.”
• Enhanced Conversions, on the other hand, lets Google match advertisers’ first-party customer data with conversion data extracted from any website where the user is logged in with a Google Account. Once matched, the data is used to attribute any conversions to the relevant ad seen by the user — and it works both for conversions that happen on a website and off a website (for example phone or email).

The comments below have been lightly edited for clarity. 

First impressions of GADM?

While these two products are not new, Google’s decision to revamp and improve them right now suggests a desire to leverage its massive logged-in user base as a replacement for third-party cookies, agreed both Webster and Mattia. They said that Google’s approach draws parallels with Meta’s Conversion API  and Customer List which is helping Meta circumvent privacy limitations introduced with the deprecation of third-party cookie and mobile identifiers, TikTok’s Customer File to create custom audience starting from user email, and Event API to track conversion using CRM data, by Linkedin with Contact targeting and Conversion API. But Google’s role in the market makes their move potentially more controversial, concluded Webster and Mattia.

What impact will GADM have on privacy?

Fosci: The platforms’ legal basis for data processing is the consent collected by the advertiser, which is often buried in the T&Cs and rarely read by the users during the authentication process. This consent process provides less transparency and control to the user than the consent process used by open web vendors. The privacy harm is even greater when one considers that even more of this advertiser data will be shared with companies that already know a lot about its consumers (including highly sensitive information). If a reduction in the number of data controllers can be seen as net privacy positive, the further concentration of personal data in the hands of a few mega-corporates is likely to ring all privacy alarm bells. 

What impact will GADM have on the ad industry?

Webster: This development has both positive and negative consequences for the industry. On the positive side, this innovation promises robust measurement options for advertisers. Its compatibility with browsers like Chrome/Android and, to a lesser extent, Safari/iOS, opens avenues for comprehensive performance analysis. Additionally, the potential extension of measurement capabilities to connected TV (CTV) and beyond could bring changes to advertising metrics. As third-party cookies get deprecated, alternative forms of targeting, retargeting and measurement are needed to maintain the open web as a competitive advertising destination.

What about the supply side?

Both: On the supply side, the benefits of using persistent IDs are likely to be limited to the walled gardens. Open web publishers, with their limited logged-in user base, will lack the scale advertisers need so there’s a real risk that advertising spend will further consolidate within Google’s ecosystem. The Privacy Sandbox gives Google exclusive control over cross-site data on Chrome, reducing targeting and measurement capabilities outside of Google’s ad network. This in turn makes the cross-site and cross-device deterministic data tied to the Google Account much more valuable, allowing Google to profit from its proprietary data and products.

At the same time, the opacity of Google’s and Apple’s measurement methodology could hinder advertisers’ ability to critically assess and incorporate findings into their independent measurement strategies. By replacing widely available attribution tools with proprietary tools (Attribution API within the Sandbox, SKAdnetowrks in Apple and GADM for deterministic data), Google and Apple become the only supply chain vendors that are allowed to assess the effectiveness of all other vendors in the supply chain (i.e. its competitors). In other words, Google and Apple are a player and referee in the same game.

How will regulators view GADM, especially the timing of it and Google’s depreciation of third-party cookies in Chrome? The overlapping timelines might be casual, but the two products are more likely part of a broader strategy embraced by all the industry.

Fosci: It is unclear how these developments will be seen by the UK CMA, which is currently investigating Google’s Privacy Sandbox. Google’s Q4 2023 Report argues that GADM “simply facilitates uploading of first-party data” and “does not enable any net-new capabilities […] in terms of addressability or measurability of ads.” But for Google to be in a preferential position after third-party cookie deprecation there is no need to build new addressability or measurability capability. All Google has to do is to develop products that make its existing ID-based technology as easy-to-use, integrated and functional as third-party cookies — which is precisely the objective of GADM, PPID and EPID. In its Q4 2023 update report the CMA has acknowledged that GADM “might place Google in a preferential position after the removal of third-party cookies” and stated that it is “considering the extent to which further restrictions on first party data sharing might be required to avoid Google gaining an unfair competitive advantage.” 

So does this mean Google is betting on its logged-in user base to replace third-party cookies?

Webster: To conclude, Google appears to be dismantling the traditional power source of cookies while concurrently pushing targeting and measurement options dependent on its first-party data, creating a landscape where only they (and other giants running closed platforms) can fully capitalize on this paradigm shift. This makes much of what is happening with the Privacy Sandbox appear like a smokescreen to the real solution. None of this is good for the open web or genuine user privacy.