Being careful not to draw too much from Google’s latest announcement, we do see five conclusions:
Conclusion #1: No magic Google solution
Since Google will not use alternate IDs, this rules out the usage of Google Login IDs for cross-site advertising purposes. During 2020 this has been a hard-to-kill myth, despite obvious anti-trust arguments. Many have assumed that publishers and advertisers will move inventory and spend to Google platforms based on a belief that Google will launch a magic solution using Logins.
Conclusion #2: Not the death of first-party IDs
First reactions proclaimed the death of unified ID solutions, but that’s a hasty conclusion. Certainly, Google’s support would have fueled faster adoption, but with most publishers running header bidding and multiple SSPs or direct DSP/PMP integrations, it doesn’t really change much. Accordingly, we read that Google acknowledges its products will have a disadvantage.
Already many publishers are deploying first-party ID solutions, despite not being supported by Google. This makes Google less competitive against other SSPs and DSPs due to its continued lack of support, and strengthens those supporting and funding these IDs. The outlook of not competing against Google Logins is very welcomed news.
The question now remaining is how Google might fight such IDs – and the app store and Chrome is where Google can look at restrictions. In the app store, it is possible for Google to impose rules, like Apple, on whether apps can use Identifiers for advertising purposes without explicit consent. It’s possible because Google ultimately controls what apps are in the store, whereas a ’technical filter’ of server-to-server ID transmission is technically inconceivable. A similar option doesn’t apply to the open internet where neither Apple nor Google would likely ban a website like Facebook in their browsers if utilizing IDs for advertising. Browsers do not control server-to-server data being passed from websites to SSPs/DSPs. There doesn’t seem a way for Google to ’turn off’ ID solutions.
Conclusion #3: This does not make Google evil
Let’s state the obvious: Google is likely on the right side of history with its decision! It is not in consumers’ interests to have their email addresses hashed and transmitted across the adtech landscape – an opinion likely to be shared by regulators as well. From a mid-to-long-term perspective, consumers having privacy concerns about Google poses a large existential threat to them.
With these mounting privacy concerns potentially hurting Google’s main search engine product, it’s a sensible strategy for Google to disengage from cross-site tracking and for Chrome to follow its main competitors in blocking third-party cookies. It would seem reasonable for Google’s left hand to follow the right hand, and not have DV360 introduce alternative IDs for tracking and advertising, so we do not see that conclusions can be made to say there is any evil behind Google’s announcement.
However, it should be mentioned the industry has been vocal with complaints about Google’s Privacy Sandbox approach. It is perceived as driven almost entirely by Google, with little-to-no industry input factored in, with limited transparency and with preferential early access by Google’s own platforms.
Conclusion #4: This is a blow to DV360
In Google’s words, other vendors will offer something that Google’s ad products will not. DV360 especially is disadvantaged in comparison with competitors. To illustrate that, let’s compare DV360 with the Adform stack, one of the vendors starting Privacy Sandbox implementation and trials. Being an early mover, Adform supports all major first-party cookie and unified IDs, such as ID5, TTD, LiveRamp and Britepool, which are affected by the announcement.
This new influx of first-party publisher IDs on Safari browsers has allowed re-activation of frequency capping, algorithmic optimization and also facilitates targeting of first-party publisher audiences linked to these. Those capabilities will be lacking in DV360 due to Google’s new policy.
Filtering out what Google now excludes in its advertiser and publisher offering, the result is illustrated in this diagram. We note that Google explicitly calls out supporting “first-party relationships on our ad platforms”, so we believe Google might introduce support of first-party publisher IDs that are not cross-site but limited to individual publishers.
Naturally, it remains to be seen which IDs will become the most dominant ones, as well as how strongly Sandbox will be able to compete against these. With full Google power behind it, it will be important, but it also looks likely many premium publishers will block Sandbox from profiling their users – it will be interesting to see if Google will do the same on YouTube and Google.com.
Conclusion #5: Nothing has actually changed
Finally, nothing has actually changed. Google has simply put some speculations to rest and given some insights into its plans – or rather, what it plans not to do. However, it is also not doing any of those today.
We’ll be deciphering more about Google’s latest news this week, so sign up to join Adform’s Identity Week webinars where industry experts will discuss the future of the identity landscape.
Jakob Bak is co-founder of Adform.