This week's Lift Letter is brought to you by Sonja Kristiansen.
Until recently, Google's various platforms, including YouTube, DoubleClick Campaign Manager (DCM) and DoubleClick Bid Manager (DBM), allowed data exports that included the DoubleClick ID (DID). A little over a week ago, Google sent a note to partners that it will no longer allow the use of the DID. The DID was the only external-facing identifier that tied the entire ecosystem together.
Google announced this change as part of its refreshed commitment to user privacy - which is heightened in no small part by GDPR and the recent Cambridge Analytica controversy. GDPR would indeed create significant operational challenges with the continued use of the DID. Yet given Google's market position, many industry insiders are inherently suspicious of moves that have the potential to materially impact the competitive balance. And it is therefore not surprising to see some that industry observers openly question the rationale. Is it truly about privacy, or is it something more strategic, like an aptly-timed move designed that may compel advertisers to stay within the walls of the Google ecosystem, becoming ever-more reliant on Google’s stack.
Eliminating the ability for marketers to pull data out of DCM for reporting and measurement across other platforms means marketers will not be as effective using multiple platforms. This is a significant challenge for marketers that want to own their audience strategies. Data like reach and frequency that once could be combined with other platforms' data through the DID will no longer be effective outside of Google's ecosystem. This also means Google data can no longer be fed into third-party multi-touch attribution platforms -- meaning marketers may end up needing to rely solely on Google's attribution system.
Google is, in many ways, caught between two countervailing forces. On the one hand, there are genuine privacy concerns. Facebook's data collection and usage have become material concerns for legislators and regulators, and Google has many similar practices. As Facebook makes active strides to address its data usage, Google needs to keep pace. That said, Facebook's advertising platform is of a significantly smaller scale and extends through less of a marketer's overall stack. Meanwhile, the advertising ecosystem has moved in the opposite direction, especially from an ID perspective. Competing platforms have taken steps to collaborate towards a "universal ID" (e.g. the AppNexus, The Trade Desk, LiveRamp and Index Exchange’s Advertising ID Consortium) while Google limits interoperability.
Some have noted that Google's Ads Data Hub, Google’s DMP-like offering, will retain use of the DID - presenting it with a nearly incomparable advantage. Some agencies have already gone on the record questioning this change and what it means for their clients - noting that it’s nearly impossible for a marketer to live in a world completely independent from the Google stack given their dominance in the DSP, ad server and site analytics world and questioning what this will mean for choice in the marketplace.
As mentioned above, Google is particularly powerful in advertising. A company with its level of market dominance cannot do the same things that a less-powerful company can do. Europe, in particular, is aggressively pursuing Google for a number of anti-competition violations. The existing cases are 1) Google ranking its shopping service above competing comparison shopping companies (which Google recently lost), 2) Google requiring Android distributors install certain Google apps in order to get the Google Play store, while also precluding pre-installation of competitive apps, and 3) exclusivity provisions in AdSense for publishers. Margrethe Vestager is the current European Commissioner for Competition and regularly issues statements concerning Google, such as remarking she will follow the implementation of Google's ad blocker in Chrome closely. The closer scrutiny on the company means that any acts that could potentially harm the ability of viable competition would raise flags.
Very few enterprises in the world have the ability to make such a move, especially in such a competitive ecosystem. Ironically, many originally considered GDPR a means by which the European governments were taming the Goliath-like platforms dominating the digital ecosystem, but moves like this clearly seem to instead bolster the positions of those platforms.