Google Topics: A close look at search giant's new plan to replace publisher cookies
This article was originally shared by pressgazette.co.uk.
Ad industry executives have described Google Topics, the tech giant’s new interest-based advertising proposal, as a “step in the right direction” for publishers though not a silver bullet solution.
Google first revealed its Privacy Sandbox plans to shift away from third-party cookies in 2019.
Since then, it has faced resistance to the Federation Learning of Cohorts (FLoC) proposal, which it said would have maintained users’ anonymity by clustering them in a group with similar interests while never sharing data that could identify them as individuals.
It was estimated that publishers may have only received up to 80% of their cookie-enabled ad revenue through FLoC, while regulators had concerns that hiding data in the way it did in the name of privacy would have impeded competition in the market by giving Google exclusive control.
Last week Google revealed it was ditching FLoC to be replaced with interest-based advertising system Topics.
Cookies on Chrome are a huge issue for publishers because around 60% of UK desktop web users and 50% of mobile ones use Chrome to access the internet. Publishers depend on cookies to track web users and serve them relevant ads.
Here we outline the new proposition and how it may affect publishers – with views differing between whether it is the “same flawed solution” or a potential boon for user experience and therefore loyalty.
What is Google Topics?
Topics is Google’s new plan to replace FLoC which, instead of grouping users like FLoC, will record several interest-based topics depending on the sites a user visits in the Chrome browser. Advertisers will then be able to serve relevant ads without knowing what specific sites people have visited, Google said.
Multiple experts told Press Gazette it was similar to the way contextual advertising already functions.
Each website will be labelled with a topic, for example sports or fitness, from a list of about 350. Press Gazette understands that publishers sites will be able to be allocated multiple topics, for example news, sports and lifestyle.
Users will be able to see the list of topics associated with them, delete any they don’t like, and opt out altogether, Google said.
When someone visits a participating site Topics will choose three interests, one from each of the past three weeks, to share with the site and its ad partners.
Google said each user’s interests will only be kept for three weeks and then be deleted.
It also said: “…by providing websites with your topics of interest, online businesses have an option that doesn’t involve covert tracking techniques, like browser fingerprinting, in order to continue serving relevant ads.”
Is Google Topics a good thing or a bad thing?
Adobe’s 2022 digital trends report, which came out this week, found that 35% of UK marketing practitioners are not prepared for a cookie-less future.
Adobe’s VP of international marketing Alvaro del Pozo told Press Gazette this was despite their demise “being in the works for some time”. “Publishers need to take a proactive approach now, and start planning and implementing their first-party-data strategies,” he said.
“By focusing on growing their direct audience and deepening their relationships with their readers and viewers, publishers will be well-positioned to deliver brilliant, personalised digital experiences their audiences expect.”
Responses to Press Gazette’s callout for reaction to Topics were mixed, although most seem to consider it at least a step in the right direction for publishers.
Others questioned how different it is to FLoC or existing contextual advertising.
James Rosewell, chief executive of data services company 51 Degrees, a founder member of the Secure Web Addressability Network (SWAN) and a director of the Movement for an Open Web group, told Press Gazette: “Topics is the same flawed solution [as FLoC] but without all the mathematical mumbo jumbo. Publishers should see it for what it is – another attempt to force them to use the Google walled garden. Don’t be fooled.”
Similarly initial analysis from Movement for an Open Web said there was “little substantive improvement… that address the main criticisms and reservations regarding FLoC”. It added: “Unfortunately, Google doesn’t allow competitors to accurately measure the accuracy of these interests nor the information required to estimate how well they work for various different marketers who compete in each market ‘category’. So crucially, it doesn’t do what cookies do.”
Rosewell questioned why advertisers, who want addressable and measurable audiences, would spend their money in the open web under these proposals if they can get the best return on investment with Google and Facebook themselves – meaning benefits to the duopoly that already dominates the industry.
Rosewell added: “There’s a lot for publishers to be concerned about and it’s based on the same proven flawed premise, which is Google, or web browsers in general, should be allowed to make these decisions and restrict what data is shared in the name of privacy because we’re trusted more than everyone else. Well, says who? Why shouldn’t [a small publisher like] Press Gazette have access to the same information that Google has if it’s shared lawfully, and consumers are in control?
“GDPR after all is a principle-based law… so why shouldn’t that be possible for publishers and consumers? Why should they have that choice removed from them?”
Loch Rose, chief analytics officer at marketing company Epsilon, shared similar concerns with Digiday. He said Topics “still seems like a recipe for taking data from valuable publishers and allowing it to be used to deliver advertising on other publishers, which will incentivise publishers with the most valuable inventory to opt out — assuming that Google makes it possible for them to do so”.
Others were more optimistic, at least in part.
Allan Tinkler, head of platform business development EMEA at ad tech company Quantcast, said publishers could benefit if they have a good user experience on their sites – although he acknowledged it may be harder to sell ad inventory as the information they have becomes more vague.
“Google has taken a sharp U-turn when it comes to FLoC, and it’s likely that we’ll see more changes and developments throughout the next few years,” Tinkler said. “Trying to find a solution that works for publishers, privacy advocates, regulators, and consumers alike remains a significant challenge. If tech giants like Google are struggling to strike this balance, other companies are most certainly confronting difficulties as well.
“For online news publishers, Topics has both its benefits and drawbacks. Given that data availability is set at three weeks, news outlets will have an edge, with their up-to-the-minute understanding of their audiences. This will not be the case for all publishers, however.
“As audience understanding is rendered more vague, online news publishers will face greater hurdles in selling inventory to brands, for whom reaching the right consumer in a measurable manner remains primordial.
“Navigating the post-cookie world and striking that balance between being privacy-first and maximising outcomes for publishers is a complex task. What is crucial, however, is ensuring that the solution works for the consumer and brings them the best possible browsing experience – something that will entice them to continue visiting their preferred publisher destinations.”
Dirk Wischnewski, chief marketing officer at data technology data provider B2B Media Group, said Topics was a “nod to the old system” and an “interesting development as it proves the necessity of keeping interest-based targeting”.
Wischnewski said publishers and advertisers “should not be afraid of” a move to “prevent unethical individual targeting”. “In fact, it’s actually an important step to gain back people’s trust,” he said.
Ryan Afshar, head of publishers UK at data connectivity company LiveRamp, said the Topics announcement was a “positive development, but it’s not the silver-bullet solution that many publishers seem to be seeking”.
He did see it as better than FLoC, saying: “Importantly, Topics also increases user control, privacy, and transparency, and prevents nefarious tracking such as fingerprinting…”
“Overall, we view this as a step in the right direction for the advertising industry, however the future of digital marketing will undoubtedly require a mix of both contextual and addressable solutions,” he went on.
“Topics could be a useful intelligence layer for publishers and marketers, but it lacks audience data. As the industry continues towards the post-cookie future, if publishers continue to operate without first-party audience data, publishers will still have too many blind spots to effectively monetise and maximise the value of their inventory, preventing them from truly competing on the open web for the lion’s share of digital ad spend.”
Julien Hirth, co-founder and general manager at marketing AI company Scibids, added: “As an industry, it’s crucial that we continue testing with Sandbox measurement alternatives and provide constructive feedback where applicable.
“Ultimately, AI will play a significant role in making Google Topics API work efficiently for publishers and the ecosystem. It’s a step in the right direction, but we need to learn more and think globally.”
Wayne Coburn, director of product, analytics and AI at US-based marketing platform Iterable, cited potential benefits for revenue and user satisfaction at newsbrands.
He said: “Before FLoC and Topics, the cookie-based advertising ecosystem allowed for many players in the supply chain to take a cut of the adbuy profits; players in the real-time bidding network would take a cut of the publisher’s revenue, dispersing the funds amongst the faceless data brokers and squeezing profits for the consumer-facing brand. Google’s Topics, which are much broader in scope than FLoC or third-party cookies, restricts target advertising, making the bidding and data-selling job of these ‘middlemen’ in the ad buy supply chain obsolete.
“Publishers need to monetise, either through subscriptions or ads (usually both). And Topics will ultimately mean more revenue for publishers and a simplified ad-buy ecosystem.”
Coburn continued: “In action, Google’s Topics will result in less-targeted ads on publisher sites. Because we know that consumers want personalised experiences, this may seem like a bad thing. Rather, it’s a good thing for consumers, like myself, who avoid searching for Christmas online during the holidays because we know that an ad will pop up when your spouse or children are surfing the web, spoiling the surprise entirely. Fewer ads mean a better experience for consumers, which will build trust and loyalty, delivering long-term value to publishers.”
What do regulators think about Google Topics?
Its concerns include that ad spending could become even more concentrated on Google, harming consumers who ultimately pay for the cost of advertising, and that the ability of online publishers to generate revenue and continue to produce valuable content in the future could be undermined.
The CMA has not yet said whether it considers Topics to be an improvement or not.
On Tuesday a CMA spokesperson told Press Gazette: “We have an investigation underway into Google’s Privacy Sandbox proposals and are in regular contact with Google in relation to its planned changes. Any updates to its processes will be considered, where appropriate, as part of our investigation.”
However Movement for an Open Web felt that Google could have developed Topics outside of its commitments to share Privacy Sandbox developments with the CMA.
Why is Google under so much pressure?
The CMA said in 2020 that Google had more than a 90% share of the £7.3 billion UK search advertising market, while Facebook – the other dominant player in online ads – had more than half 50% of the £5.5 billion display ad market.
Google is therefore trying to improve privacy for users at the same time as the publishing industry is fighting for fair opportunities in the market.
Google’s latest financial results, published on Tuesday, showed it had “ongoing strong growth” in its advertising business. Chief financial officer Ruth Porat said: “Our fourth-quarter revenues of $75bn, up 32% year-over-year, reflected broad-based strength in advertiser spend and strong consumer online activity…”
The announcement of Topics also came days before the Mail on Sunday reported the UK’s Culture Secretary Nadine Dorries is planning on forcing Google and Facebook to pay newsbrands for the use of their stories under the Digital Markets Unit.
A Department for Digital, Culture, Media and Sport source told the newspaper that by “opening up the online advertising market to competition [the legislation] could also see longer-term benefits for publishers”. They also said the DMU would ensure publishers get “greater access to data on how users interact with their content”.
What else could happen next?
Rosewell called for regulators to “press pause”, which in the UK would mean the CMA issuing an interim order. He said the talks, which have so far lasted two years, “effectively create a tax on the rest of the industry” and were not having any meaningful benefit to society.
“A few multi-trillion-dollar companies in Silicon Valley deciding what happens in Britain, as far as media is concerned, is deeply troubling to us all,” he added.
Rosewell was in favour of the UK to first have new legislation in the form of the Digital Markets Unit as, at present, the industry is effectively negotiating with a gun to its head, he said. This creates a “fearful” and “toxic environment”, but if legislation is put in place there can be “a genuine discussion around improving privacy,” he added.
Rosewell pointed to SWAN, a new project using only pseudonymous identifiers which he said some corners of the market have been receptive to since its launch in April last year, as his preferred alternative.
With SWAN, users who visit signed-up publishers would only be asked to consent to personalised marketing once – with their choice then carrying over to all the other websites involved.
The privacy message would also allow publishers to explain to their readers why personalised ads help them make money and fund more journalists. A unique identifier enables the personalisation, if opted in, to be shared without the use of third-party cookies. Users will also be able to more easily tell websites if there are particular adverts they are uninterested in – which could mean publishers can better make the most of their ad slots and make more money.
Outside of the Privacy Sandbox, Google is also trying to help publishers to expand the use of their first-party identifiers to serve more personalised ads.