Google Has a New Ad Algorithm Game Plan After it Phases Out Cookies

Last January, Google laid out its plan to phase out support for third-party cookies by 2022. To address skeptics, the search and advertising giant made a new commitment on Wednesday:

• “Once third-party cookies are phased out, we will not build alternate identifiers to track individuals as they browse across the web, nor will we use them in our products.”

Google’s new M.O.

The company says declining consumer trust puts “the future of the free and open web” in jeopardy. But wait, there’s the unspoken part: Three months ago, attorneys general from 10 states hit Google with a lawsuit related to its outsized digital advertising power.

The alternative: Google is betting on a new ad strategy to kill two birds with one algorithm: Federated Learning of Cohorts (FloC). The basic gist: User data can be "hidden" within large groups of like-minded individuals—and still deliver valuable ad insights. It’s a continuation of a privacy-focused form of machine learning the company introduced in 2017.

Don’t get too comfortable

Google may be rolling back some third-party ad capabilities, but it still has loads of first-party data...and more than 70% of its revenue comes from advertising. Though there might be fewer unique identifiers, targeting isn’t going anywhere.