Digital Transformation Data & Privacy

Google Analytics stops logging IP addresses: here’s why it’s a big deal for marketers

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By Kendra Clark | Senior Reporter

March 16, 2022 | 8 min read

By announcing the elimination of IP address logging on Google Analytics, the tech titan is doubling down on its focus on consumer data privacy. While some applaud the move, other see it as a headache for advertisers and another nail in the coffin of digital marketing as we know it.

Google is axing Internet Protocol (IP) address logging on its analytics platform. The decision could hamper marketing effectiveness by cutting off advertisers’ ability to access user location data, but experts say it’s a sensical move in the broader context of maturing privacy standards.

An IP address is a unique identifier that allows Google, and others, to locate an individual user’s device on the internet or a local network. Advertisers rely on this information for targeting – but its days on Google’s analytics platform are numbered.

Person looking at Google Analytics dashboard

Google Analytics will stop tracking user IP addresses / Adobe Stock

The move is part of a larger decision announced today, which will see Google Analytics 4 (GA4) take the place of Universal Analytics (UA) and Universal Analytics 360 for all Google customers beginning next year. In a statement shared with The Drum, the company said the decision was made in response to “a monumental shift in the way people behave on the internet and ... how we measure that behavior.” In essence, Google sees the UA platform as increasingly outdated due to its reliance on third-party cookies – which are disappearing as fast as the long winter days. Instead of cookies, GA4 will employ an event-based framework, which aggregates data from specific instances of user interaction to generate modeled data that’s easy to query. The shift aims to enable seamless operations across platforms. GA4 also offers a range of new, valuable integrations across Search, Google Cloud, YouTube, Google Display & Video 360 and more.

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But the company noted that the decision to shift to GA4 also has to do with “the constantly evolving privacy landscape.” As part of Google’s efforts to address the changing privacy space, the new iteration of its analytics platform will no longer store user IP addresses. The move represents a major shift away from long-standing tracking-based models of data collection, advertising and campaign measurement, and reinforces Google’s increasingly stringent privacy stance.

Some marketers are already worrying that the decision to eliminate IP address logging in GA4 will hamper ad targeting and measurement. They’ve already seen this occur as a result of Apple’s privacy-centric iOS changes – such as its AppTrackingTransparency policy, which gives users more say over the apps and websites with which they share their personal information.

Russell Ketchum, director of product at Google Analytics, says that tracking IP addresses is simply no longer necessary, since GA4 is equipped with other tools to help marketers optimize performance. “We’re not logging or storing IP addresses because we no longer need to,” he tells The Drum. “When we introduced Google Analytics 4 [in October of 2020], we made it clear that there was a core focus on end-user privacy. IP addresses have been anonymized in Google Analytics 4 since it launched and, with this new announcement, we’re going even further and removing IP addresses altogether. This change won’t impact the quality of customers’ reports.”

And for many, the change comes as no surprise. “Google has been developing this new analytics platform for more than three years now, so ... [the news] isn’t completely unexpected,” says Charles Farina, head of innovation at Adswerve, a firm specializing in Google marketing and analytics. “The company has made the decision to sunset Universal Analytics for Google Analytics 4 in direct response to consumer data privacy preferences and evolving marketing strategies that do not lean on third-party cookies. This is a shift from a session-oriented model to an event-based model that better aligns with how companies are looking to measure user engagement with their digital marketing content in the future.”

Beyond Google’s ongoing efforts to improve consumer data privacy standards by phasing out the third-party cookie come 2023 and abandoning last-click attribution for a machine-learning-based model as the standard yardstick for marketers, the broader cultural shift toward more stringent privacy norms is well under way. Following the implementation of the EU’s General Data Protection Regulation (GDPR) in 2018, the international community has seen a proliferation of similar national and state-level laws both proposed and passed that have introduced new protections and controls for consumers but have limited business’ ability to collect, store, sell and use consumers’ personal information. For advertisers in particular, the stakes have grown exponentially higher with new user privacy policies implemented by tech players such as Google and Apple.

Although it’s been a leader in determining the future of consumer data standards and norms, Google itself has come under fire a few times over the last couple of years for failing to adhere to privacy standards – including as recently as December.

Google Analytics in particular has been the subject of some controversy amid Schrems II, the EU’s landmark data protection verdict issued in July of 2020, which, for surveillance reasons, prohibits Europeans’ data from being shared with US servers. The new GA4, however, will offer country-level controls that allow its use to be customized according to local and state-level regulations. This change could help the platform gain adoption in Europe; previously, many EU policymakers have forbidden its use due to the classification of IP addresses as protected personal data under Schrems II.

Plus, earlier this year, both the Austrian Data Protection Authority and France's Commission nationale de l'informatique et des libertés have cracked down on privacy in two cases involving Google Analytics.

The decision to ban IP address logging on Google Analytics 4, then, is seen by some as a strategic move by Google made in response to backlash faced in Europe. “In light of the recent Google Analytics decisions in Europe, and in particular, the Austrian Data Protection Authority’s emphasis on the failure of the website operator to properly implement IP ‘anonymization,’ the IP address change is likely a timely effort to mitigate such risk while awaiting resolution on the broader issue of EU-US transfers,” says Arielle Garcia, chief privacy officer at UM Worldwide. “The GA4 privacy controls, and their country-level settings, will be useful for brands as they consider refining their privacy approach – for example, ahead of the new state laws that will be operable in 2023.”

Others argue that marketers who are already on the ball won’t see much of a practical difference in the platform’s new privacy changes. “The privacy features being added to GA4, such as IP address redaction, have little or no penalty,” Doug Hall, senior director of analytics EMEA at Media.Monks, says. “The industry has known for the best part of a decade what data with purpose looks like, and the loss of IP address resolution is inconsequential for analysts and marketers, with only upside for the users.”

At this point in the game, most savvy marketers have moved beyond reliance on the location and ISP information gained from tracking user IP addresses, according to Hall. Plus, he says, the industry’s growing attention to consumer data privacy will naturally fuel innovation.

GA4 will only equip marketers to better prepare for the cookieless future, says Hall. “GA4 has more integrations and more features for first-class first-party data gathering – there’s every reason to believe that in 12 months, we’ll look back at the session-based, page view-oriented, artificial constructs that the old data model imposed and we’ll be thankful for change. The trajectory is clear, if not immediately welcomed by all.”

Universal Analytics will be officially phased out on July 1 2023 and Universal Analytics 360 will follow on October 1 2023. Google declined a request for comment.

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