There may finally be an answer to the question of whether Google will ever loosen the reigns on ad targeting and allow marketers to use their first-party data to reach existing customers.
Citing anonymous sources, The Wall Street Journal reported Tuesday, that Google has been talking with several advertisers about using data sources such as customer email lists to target ads in the search results. Marketers have grown accustomed to this type of targeting with Facebook’s Custom Audiences as well as Twitter’s Tailored Audiences which enable advertisers to upload customer data that can be used for segmentation and ad targeting on those platforms.
Google has sat on the sidelines as the rest of the industry has moved in the direction of giving advertisers tools to incorporate first-party data in ad targeting. The closest Google has come to this level of targeting in search is with Retargeting List For Search Ads (RLSA) which allows advertisers to target past site visitors, as opposed to known customers.
Google’s hold out has been driven by privacy concerns in maintaining anonymity in search. In doing so, it has left significant money on the table — and allowed more ad spend to head to Facebook. David Rodnitzky, CEO and co-founder of 3Q Digital, a Harte Hanks company, predicted in his recent Marketing Land column, “that the advocates inside Google who are pushing for greater use of first-party data in the name of higher advertising revenue will eventually win this argument. And when they do, it has the potential to be one of the most lucrative advertising programs Google has ever launched.”
With the first-party data advocates now apparently coming out on top of the debate, the upside for Google and marketers is huge, as Rodnitzky pointed out.
What Marketers Are Saying
Marketers have been after Google to open up this functionality for some time. George Michie, Chief Marketing Scientist at RKG, a Merkle company, said by email that Google hasn’t given them a concrete answer on the program, but “it makes too much sense for them and it’s been on everyone’s ask list” for Google to keep holding out. “Facebook may have forced their hand, here, but be that as it may we’ve clamored for this!”
Michie added, “Browser behavioral targeting is a pretty crude tool – better than nothing, certainly – but pretty crude. The ability to fold in real customer insight, understanding all the brand’s interactions with a person online and offline going as far back in history as you want is a gigantic leap forward. Understanding which customers prefer to buy online or off, which physical location they prefer allows for a level of personalization we just haven’t had in the walled-garden of Google.”
Jason Hartley, Vice President and Search Marketing Practice Lead at 360i, sees this as the natural evolution of moving away from keyword-focused search to consumer-centric search. “RLSA is powerful,” says Hartely in an email, “but it’s peanuts compared to being able to upload emails from your CRM database so you customize your bids and ads based on rich information you have about your customers.”
Hartely notes that segmentation capabilities will be key in making this functionality truly effective. “If I know that a segment of my customer base has a higher than average AOV [average order value] and prefers Levi’s, then when they search ‘blue jeans’, I’m going to bid higher and make sure my copy and landing page is going to be Levi’s focused.”
For Google, Rodnitzky wrote in his column, “The opportunity to monetize currently unmonetizable queries is probably the single biggest untapped advertising opportunity online today.” The idea being that advertisers would be willing to show ads against millions of unrelated search queries if they were able to get those ads in front of known entities, proven customers. This, coupled with higher competition for commercial queries, is likely to have a big impact on Google ad revenues. (Though millions of relatively low bids on non-commercial queries surely won’t have a positive impact on Google’s sagging CPCs.)
Google has only said, “We’re always discussing potential product ideas with our clients, but have nothing new to share at this time.” The WSJ’s sources said Google has suggested the ad targeting could become available later this year or early next year.
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