How Google TOPICS Impacts Analytics Strategy for Consumer Data Privacy and Digital Ads

On Jan. 25 Google announced a major evolutionary change for its privacy sandbox campaign to eliminate third-party cookie usage for its digital ads and analytics solutions. Until then Google had been developing a data privacy management framework, called Federated Learning of Cohorts (FLoC), that intended to help serve digital ads while preventing unwanted ads and covert tracking online from third-party solutions.

Now Google has replaced FLoC with an algorithmic API framework called TOPICS for its privacy initiative. The tech giant believes TOPICS will offer the right combination of personalized advertising insight and protection of consumer privacy.

How Google TOPICS Improves Interest-Based Marketing and Privacy

Given its market share dominance in browser usage and online search, Google has been working to position itself at the vanguard of the industry transition away from third-party data generated from browser cookies. Its first attempt resulted in FLoC.

FLoC was designed to replace cookie-based advertising signals by applying machine learning modeling to browser history. The models note the topic of a website visited through a browser, match the topic to a category, and then allow the appearance of personalized ad campaigns based on the category. The categories are simple descriptions that are relevant to consumer activity, such as “travel” and “fitness.”

The initial plan was to roll out FLoC, allowing marketers to gradually adjust supporting ad campaigns and search strategy. But initial industry feedback of the first trails with FLoC raised potential concerns about model performance.

In an API documentation for TOPICS on GitHub, the FLoC trials feedback included concerns about identifying customers according to cohorts. The sharpest feedback was the concern about fingerprinting, a technique in which information about the software and hardware of a remote computing device is collected for the purpose of identification.

Any information gathered without explicit online permission is increasingly questioned, and identifying mobile devices can sometimes be akin to identifying someone without permission.

Related Article: Why Did Google Drop FLoC for Topics and What’s the Marketing Impact?

Google’s Reimagined Approach

With TOPICS, Google incorporated the lessons learned from FLoC into a reimagined approach. The machine learning model for ad guidance remains, but with a revised framework that incorporates a time block feature.

When analyzing the topics from a user’s browser behavior history, TOPICS identifies the top three categories based on a three-week period of history. Google TOPICS also provides user controls within the search engine to let users regularly review the categories and remove the ones that will likely send ads irrelevant to them or ones they just don’t like.

The categories in TOPICS began at 350, relating more to consumer daily interest. But this will certainly change — a majority of B2B professionals rely on Google Search, so it is likely categories will play a bit more into business needs when TOPICS is rolled out for wider usage. Thousands of categories are expected to be added soon.

Potential Benefits for Marketers, Consumers 

The impact Google TOPICS brings to analytics becomes as profoundly multifaceted as analytics itself. The systems and behavior strategies being measured through analytics will gain through Google TOPICS clearer signals related to page visitor behavior, raising the quality of measurement applied.

Here are three potential benefits:

Marketers and Consumers More Confident

One impact from Google TOPICS is a potential lift in confidence from both consumers and marketers — a rare opportunity given well-known struggles in attribution and cross-channel messaging these days. With a user-selected limit to browser behavior history, consumers will feel confident that they can control which advertisers learn their interest while casually browsing web sites.

Marketers will have better choices for understanding how personalized ad campaigns are influenced. That influence often drives where ads are placed within online content through networks not originally on an advertising plan. Marketers are demanding a tool to prevent ad campaigns from appearing on online networks hosting the wrong customer audience. Google TOPICS aims to be that highly desirable tool.

Boost to Behavioral Cohort Analysis

The second impact is a guiding timeframe for data to be used in a behavioral analysis. For example, a SEO keywords analysis can reflect search queries or conversions from customers who presumably have seen a given campaign over a three-week period since the campaign launch date. Incorporating TOPICS into an analysis also serves as a starting point to guide campaign scheduling.

This scenario gives marketers a reasonable assumption for how long customer interest in content will remain, bolstering behavioral cohort analysis. By having the data associated to a set retention period and a known set of user interests, TOPICS brings a consistency into the type of cohort that will be identified from the data.

Emphasis on Device-Focused Search Behavior Data

A third benefit from Google TOPICS is that ads are curated without involving data sent to a server, addressing a major privacy sticking point. First-party data that eliminates transference ensures compliance for privacy regulations that involve data residency — the application of laws according to where data resides relative to a given territory.

Google and other tech giants have struggled with court decisions regarding data privacy. My privacy post explains the recent legal decision declaring Google Analytics non-compliant because of its data being sent to servers outside the European Union. TOPICS eliminates this server residency concern by placing an emphasis on device-focused search behavior data within a client rather than involving servers.

App Development Will Also See Google TOPICS Influence

Google TOPICS is significant not only from an analytics solution standpoint. Developers are learning how to provide services through browser extensions. Extension provides another level of data that can assist customer experience, especially when an app is central to that experience. Naturally, ads are also used in many apps, so developers also share the same concerns as marketers for maintaining ad relevancy and protecting customer privacy from outside parties.

Developers will see further technical options to address those concerns. Google announced the TOPICS framework becoming available for Android apps. In addition, a developer trial is forthcoming where Google will learn more insights on acceptance of user controls from marketers and developers. Developers will also see a second API framework, PLEDGE, designed for re-marketing and custom audience needs, while avoiding third-parties that track user browsing behavior across sites. Google will reveal more about PLEDGE later this year.

Marketers working alongside developers will need to better understand what devices customers use as they are experiencing ads and content. This has always been available through the tech reports in analytics solutions, which I explain in this post:

Related Article: How Google Analytics Tech Report Can Inform an App Launch or Marketing Strategy

What Will Google Bring Next for Marketers and App Developers?

Google is confident that TOPICS will provide improved customer experience with ad campaigns while protecting consumer privacy. In the meantime, marketers can prepare adjust their data analysis for first-party data strategies.

Consumer browser privacy is about having a choice for your exposure to advertisers during an online search. People still accept ads but are demanding better privacy measure to ensure relevancy. Google is working to respect those choices, highlighting a machine learning strategy that incorporates first-party data and privacy-first needs.

As a result, Google TOPICS may be the best opportunity yet to strike a balance between personalized convenience for consumers wanting privacy and insights for marketers wanting to serve the relevant personalized ads.