In early 2020, when Google announced it would replace third-party cookies with its Federated Learning of Cohorts (FLoC), privacy experts warned the new technology would only worsen things. They argued FLoC would create new privacy issues and that its resulting behavioral-based ads would increase discrimination and predatory targeting. In Google’s eyes, lumping people into cohorts was far better than third-party tracking. Ultimately, the privacy police had their day and FLoC was pulled from the shelf and replaced with a concept Google is now calling Topics.
But as Google irons out the details on Topics, some within the industry are taking what comes next with a grain of salt. They believe Google is preparing a Hail Mary plan and that the end game for Web tracking is near. According to Beeby Clark+Meyler (BCM) co-founder and Principal Michael Clark, it’s only a matter of time before Google’s Topics goes away too.
Google’s Business Model is in Danger
“Google is investing a lot of time and money into maintaining its leadership within paid search marketing,” said Clark. “But when you sit back and look at what’s happening within the online industry as a whole, Google’s model is outdated. The way people engage online now is completely different than it was 24 years ago when cookies and Google came to be. Today, it’s all about media platforms.”Founded by Tom Beeby, Michael Clark and Stuart Meyler, BCM is an integrated performance marketing agency that has made a name for itself by representing clients such as Visit Florida, AON, Stokke, Energizer, Choice Hotels and many others. The boutique agency has a unique ability when it comes to helping large enterprises get a giant ROI on their digital marketing dollars. The firm also specializes in marketing automation systems like Salesforce Marketing Cloud.
When it comes to limiting third-party cookies, Google is trailing its rivals. Seeing the writing on the wall, Apple’s Safari started the trend in 2017. But because Google’s Chrome has the lion’s share of the search market, it has maintained a different standard, regardless of what others do. After failing with FLoC, however, onlookers aren’t so sure that Google’s new plans will continue to shape the future of online advertising.Due to consumer and governmental pressures around privacy, and the changes being made as a response to privacy pressures, the tracking and measurement of digital media is fundamentally changing. And the implications of these changes are forcing all media platforms⎯Facebook, Pinterest, LinkedIn, Google, Amazon, etc.⎯to provide alternative ad targeting and performance insight capabilities for advertisers. Advertisers have been preparing by organizing their first-party data (email addresses and other CRM data) and second-party data (partner data) to aid in targeting and media delivery. However, the potential effectiveness of these things is being called into question, especially given how media platforms are organizing their advertising products.
Social Media Platforms Will Evolve
“The walled-garden nature of big media platforms will become more of a factor in media targeting and measurement, rendering tactics like retargeting and website-based lead and purchase fulfillment obsolete,” said Clark. “Marketing automation and CRM platforms may also be endangered, especially because platforms like Facebook and LinkedIn could conceivably host these functions better than advertiser-side platforms like Salesforce, Eloqua and Adobe.”
Media platforms like Facebook, TikTok, and LinkedIn will continue to evolve. After Apple’s iOS changes required Facebook and other apps to ask users permission to track or access their device’s advertising identifier, only 4% of users opted in. This means that 96% of US-based iOS users are invisible to tracking and attribution events that occur outside of the Facebook platform. Android users will be similarly protected in 2023.
“Facebook pixel retargeting will be almost impossible, as will retargeting customer files,” said Clark. “As a result, Facebook Custom Audiences, a very popular and productive tactic, will be greatly diminished. In addition, any data or lists ported into Facebook from an outside source will not be able to populate unless opted-in to tracking. This includes 1st-party data, Pixel Audiences, 2nd and 3rd-party data.”
According to Clark, this will also impact look-a-like audiences, which CRM and marketing automation platforms have enabled for advertisers. And regarding attribution, advertisers will only see one event file based on priority. The pixel will know that an action was taken but won’t be able to tie the action back to a user. This means reporting will be limited to one event, and it will be anonymized.
Social Media Platforms Will Take Control
“As a result of increasing privacy measures, Facebook’s algorithm will start relying on what data it can see,” added Clark. “Because a user’s data is not visible when they leave the Facebook app, the algorithm will focus on the only thing it can see; on-Facebook actions. The actions will become the basis for optimization strategy and this dynamic will occur on LinkedIn, Pinterest and other platforms as well.”When asked what this all means for businesses, Clark hinted that there would one day be no media benefit to sending consumers to a website. Social media platforms like Facebook, LinkedIn, and others will become the new purchasing ecosystem.
“Platforms like Facebook and LinkedIn are addressing this by providing services such as Lead-gen ads and Instant Experiences,” he said. Basically, social media platforms are now hosting the shopping conversion process within the media platform. All interactions with these on-platform ad products can be fully tracked, measured, retargeted, and optimized. Look-alike-audiences will also be available from these tracked interactions.”
Tracking doesn’t mean knowing, however. The advertiser will not have access to personally identifiable information (PII). And, what advertisers have long feared, they will not have a direct relationship with the prospect. It will all happen within these new ecosystems. But the good news is, it is highly likely that the hosted media platform prospect-customer engagement process will outperform the website-based process of most advertisers.
The End of Website Marketing
“On the bright side, most websites suck at converting prospects anyway,” said Clark. “Most advertisers fail to invest in basic landing page optimization, speeding up their websites, or building simple look-a-like models of their own customers. Now, the media properties will do these things for them, without their participation.”
Clark also noted that “website traffic as a metric will become less meaningful as much of the brand interaction, lead capture and conversion activity will occur at the media platform level, rather than at the website level.”
Unless there is a drastic change in the direction of privacy pressures, websites, personalization engines, and marketing automation platforms will be subsumed by media platforms. Why have Salesforce when you have LinkedIn? As a result, advertisers and their agencies will need to invest heavily in modeling rather than rely on direct observation to garner insights about their advertising and marketing performance.
This content was originally published here.