Published: 1. September 2018 20:33:30
Over the past year, select Google advertisers have access to a powerful new tool to determine if the ads they put online led to a sale in a store in the United States. This recognition is partly due to a large number of Mastercard transactions that Google has paid for. But most of the two billion MasterCard owners are unaware of this behind-the-scenes persecution. Because the companies have never told the public about the agreement.
Google and Mastercard Inc. of Alphabet Inc. have formed a business partnership during four years of negotiations, according to four people who knew about the business, three of whom worked directly on it. The alliance gave Google an unprecedented benefit in measuring retail spending, which was part of the search giant's strategy to strengthen its core business against attacks by Amazon.com Inc and others. But the deal, which has not been reported yet, could lead to further privacy concerns about how many consumer data technology companies, such as Google, quietly absorb.
"People do not expect that what they buy physically is connected with buying online," said Christine Bannan, adviser to the Electronic Privacy Information Center (EPIC). "There's just too much of a burden that businesses impose on consumers, and not enough corporate responsibility to let users know what they're doing and what their rights are." Google paid Mastercard millions of dollars for the data, so two people worked on the deal, and the companies were discussing sharing some of the advertising revenue, according to one of the people. People did not want to be identified when discussing private matters. A spokeswoman for Google said there was no agreement with its partners on the distribution of revenue.
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A Google spokeswoman declined to comment on the partnership with Mastercard turned however, to the ad tool. "Before we launched this beta product last year, we've developed a new, double-blind encryption technology that prevents both Google and our partners from seeing personally identifiable information from our respective users," a statement said. "We do not have access to personal information from our partners' credit and debit cards, nor do we share personal information with our affiliates." The company said users can disable ad tracking online using Google's "web and app activity" console. In Google, several people objected that the service had no obvious way for cardholders to reverse the persecution, one of the people said.
Seth Eisen, a Mastercard spokesman, also expressly declined to comment on Google. But he said Mastercard shares transaction trends with traders and their service providers to help them measure "the effectiveness of their advertising campaigns". The information, which includes sales volume and average size of the purchase, will be added only with the permission of the dealer, Iron, shared. "No individual transaction or personal data is provided," he said in a statement. "We do not provide insights that track ads, show ads, or measure ad effectiveness for individual customers." Last year, when Google announced the "Store Sales Measurement" service, the company said it had access to "about 70 percent" of US credit and debit cards through partners without naming them. "
These 70 percent could mean that the company Contracts with other credit card companies, which accounts for 70 percent of the users of credit and debit cards, or it could mean that the company has signed contracts with companies that include all card users, and 70 pr Of these, tens of thousands of people sign in to Google Accounts like Gmail when they click on a Google search ad. According to two people who are familiar with the talks, Google has contacted other payment companies about the program, but it is not clear if they have made similar offers. People did not want to be identified because they were not allowed to talk about the matter. Google has confirmed that the service will only apply to people who are signed in to one of their accounts and have not opted out of tracking ads. According to Nilson Report, a finance research firm, purchases of Mastercard cards last year accounted for about a quarter of the US volume.
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This trial allows Google to anonymously match these existing user profiles to physical store purchases. The result is impressive: Google knows that users have clicked on ads and can now tell advertisers that this activity has led to actual sales. According to a spokeswoman, Google tests the data service with a "small group" of advertisers in the US. Marketers see aggregated sales and estimates of how many they can associate with Google ads. However, they do not see any personal information from buyers about how much they spend or what exactly they buy. The tests are only available to retailers, not the companies that sell the items in stores, the spokeswoman said. The service only applies to his search and shopping ads, she said.
For Google, the MasterCard deal fits in a broad effort to drive more retail spending. Advertisers spend a lot of money on Google to gain valuable insight into the connection between digital ads, a website visit, or an online purchase. It's harder to tell how ads affect offline behavior. This is a particular frustration for companies that market items like clothing or housewares that are often researched online but go into stores to buy them. This gap has caused Google to look for ways in which its largest customers could estimate offline sales and then connect them to the promotions they are placing on Google. "Google needs to link this activity with one click," said Joseph McConellogue, head of online retail for the advertising agency Reprise Digital. "Most advertisers rely on this type of integration."
First, Google developed its own solution, a mobile payment service first named Google Wallet. Part of the original goal was to tie clicks on ads to purchases in physical stores, according to someone who worked on the product. But the adoption never got started, so Google started looking for allies. A spokeswoman said that her payment service was never used for ad metering.
Since 2014, Google has shown advertisers when someone who clicked on an ad visits a physical store using the Location History feature on Google Maps. However, the advertiser did not know if the buyer had made a purchase. So Google has added more. With a tool introduced the following year, advertisers can upload email addresses from customers who track them to the Google Ad buying system and then encrypt them. In addition, Google relied on data from third-party data brokers, such as Experian Plc and Acxiom Corp, which used demographic and financial information for marketers.
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But these tactics did not always lead to more ad spending. Retail stores could not easily connect emails to their ads. And the information they received from the data brokers about the sale was inaccurate or too late. Marketing managers have not mass-deployed these location tools, said Christina Malcolm, director of digital advertising agency iProspect. "They did not give them what they need to go back to their bosses and tell them, 'We beat our numbers,'" she said.
Then Google brought in map data. In May 2017, the company introduced Store Sales Measurement. It consisted of two components. The first option is to provide companies with personal information about consumers, such as encrypted email addresses, to upload to the Google system and to synchronize ad purchases with offline sales. The second injected card data. It works like this: A person searches on Google for "red lipstick", clicks on an ad, surfs the Internet, but buys nothing. Later she goes to a store and buys red lipstick with her Mastercard. The advertiser who served the ad receives a report from Google listing the sale, along with other transactions, in a column labeled "Offline Revenue" – only when the web surfer is signed in to a Google Account online and the Buy within 30 days Click on the ad.
Advertisers receive a bulk report of the percentage of buyers who clicked on an ad or served an ad, and then made a relevant purchase. The spokesperson for Mastercard said that the company does not look at data on each item purchased in stores. It's not an exact match, but it's the most powerful tool that Google, the largest ad salesman in the world, has offered to go shopping in the real world. Advertisers once had a patchwork of customer data in their hands to see who saw their ads and who was asked to. Now they had much more clarity.
Google's advertising chief, Sridhar Ramaswamy, introduced the product in a blog post and wrote that advertisers had "no time-consuming setup or costly integrations" Agreement with Mastercard
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Initial signs indicate that the deal was a blessing to Google. The new feature also combines transaction data in advertiser systems as they occur. This resolves the pre-existing delay and allows Google to serve better-performing ads. Malcolm said her agency had tested the card measuring tool on a major advertiser she did not want to mention. Earlier, the company had generated $ 5.70 in revenue, according to an iProspect analysis for every $ 1 spent on marketing in the Google advertising campaign. With the new transaction function, the return doubled to $ 10.60.
"That's really powerful," Malcolm said. "And it was a really good way to invest more in Google, frankly." But some privacy critics mocked the tool as opaque. EPIC filed a lawsuit last year against the US Federal Trade Commission. A report in August that Facebook Inc. talked to banks about accessing information for consumer products sparked similar criticism. For years, Facebook and Google have been working to link their huge user behavior with consumers' financial data.
And financial companies have found ways to leverage the wealth of digital advertising. Google's connectivity is not Mastercard's only attempt to shape customer-generated data. The company has expanded its data and analytics capabilities over the last few years through its consulting division, Mastercard Advisors, and offers advertisers and merchants the ability to forecast consumer behavior through cardholder data. Ad buyers who work with Google insist that the company keeps the boundaries between transaction information and behavior on the Web, and keeps the information anonymous to retailers and marketers. "Google is very strict about this," said Malcolm.
Prior to the launch of the product, Google developed a novel encryption method, according to Jules Polonetsky, head of the Future Privacy Forum, who was notified by Google about the product. He explained that the system ensures that neither Google nor its payment partners have access to the data that everyone collects. "They share data that has been transformed in such a way that if they get public, no party could do anything with it," Polonetsky said. "There is no privacy risk." The Future Privacy Forum, a nonprofit corporation, receives funding from 160 companies, including Google.
Google's advertising business, which had $ 95.4 billion in revenue in 2017, has grown at a staggering 20% per year. But investors have been worried how long that can take. Many big advertisers are starting to spend more on Amazon, the company that hosts far more and more detailed online shopping data. In response, Google pushed ahead with offline measurements. The company, like Facebook and Twitter Inc, has explored the use of "beacons", Bluetooth devices that track when shoppers go into stores.
Some advertising agencies have actively talked to Google about more ways to better measure offline behavior. You have discussed adding functions to the display system, such as: At what time of the day people buy items and how much they spend, said John Malysiak, who runs search engine marketing for Omnicom agency OMD USA. "We're trying to go deeper with Google," he said. "We would like to understand more." Google declined to comment on the discussions.
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