The Cookie Crumbles

Silicon Valley has a saying: Live by the platform, die by the platform.

Translation: If your business relies on anyone else to exist then your livelihood is subject to the whims of that provider, which can change at any time. Their business is more important to them then yours.

So, when Google – the Mississippi River of ad tech – dams up a major tributary saying it will no longer support online data tracking, colloquially known as “cookies” a lot of companies are going underwater.

Starting in 2022, firms used by political campaigns to find and identify voters (data brokers like LiveRamp, BlueKai) and ad exchanges which resell Google’s ad inventory (Trade Desk, A4) to the highest bidder will face dramatic changes in how they do business. Some may not survive.

Says Google:

“People shouldn’t have to accept being tracked across the web in order to get the benefits of relevant advertising. And advertisers don’t need to track individual consumers across the web to get the performance benefits of digital advertising.”

Short version: No more swapping out or selling data that monitors and analyses the behavior of Internet users. In other words, you won’t be able to buy so-called “buckets” of, say, Democrats who own guns and drive Priuses on your favorite DSP.

It gets worse. Google is flatly saying that the use of personally identifying information suggested by some of these intermediary vendors will longer be a way to cull or identify users. Here’s more:

“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 [personal identifying information] graphs based on people’s email addresses. 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.”

Translation: Feel free to use other use tracking techniques but be aware that Google will not support that behavior to sell ads. And Google controls most ad sales.

Google is not the most politically savvy firm in the country (too many billionaires in leadership) but it knows that the 40-and counting lawsuits it’s facing in state capitols across the country, the threatened oversight by federal regulators and a general distrust and suspicion of big tech – which it embodies in a single verb – means things have to change.

What it’s offering as change is audience-based ad sales, more formally known as “Federated Learning of Cohorts.” These “FloCs” will let advertisers find groups of Google Chrome users – and, so far only Chrome users – package and sell to them as they see fit. Google will control the grouping, the cohort definition and the access. Outside data – voter files – will not be allowed.

This raises lots of questions. Privacy activists are already questioning Google’s apparently total control of data and suggesting that a closed ‘black box’ for targeting users is just as bad as the free-for-all that currently exists.

So what does this mean for political advertisers? Well, kiss voter file targeting good-bye. Voter files are composed of personally identifying information [PII] like age, name, home address and gender, which has always been questionably effective.

Secondly, be very concerned about how any “political cohort” might be constructed. Political advertising doesn’t work like brand ads. Joe Biden isn’t a budget hotel chain, Elizabeth Warren is not an organic apple grower. Political cohorts, if created, won’t be able to keep up with changing voter perceptions. They are likely to go out-of-date quickly

Political cohorts will also vary by location – they won’t scale like brand advertising. As the 2020 election demonstrated, while a San Francisco Republican and South Carolina GOP supporter may pull the same party ballots their choices, especially at the local level, will be very different.

Then, of course, there’s the question of whether or not Google will even permit these political cohorts to exist. Political ad revenue made a lot of Google’s DC sales team very happy last year. But that revenue – still less than $1 billion – was a fraction of Alphabet’s $180 billion – and a large portion of its bad PR.

It’s a safe bet that large presidential campaigns will craft cohorts for their efforts. But it’s just as safe a bet that they won’t share with other firms or other campaigns. And it’s likely those cohorts will have short shelf lives and be pretty useless on a local level.

Spot-On’s been touting the value of contextual ad buying – putting ads on known sites – for a while. We’ve even built a new ad buying platform specifically for political ad buyers. Our Pinpoint Persuasion platform is independent from Google’s technology and designed for the specific needs of political ad buyers who want to reach known established outlets in cities, counties and states where their voters live.

We’ll have more public details soon but if you’d like an early look, feel free to give us a shout and we’ll set you up with a demo.

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