Google’s Q2 updates to Customer Match

Yesterday, Google announced that beginning in Q2 of this year, campaigns using Smart Bidding and Optimized Targeting would use all Customer Match lists in user accounts. This is an effort to automatically improve campaign performance over the most recent best practice, which is applying those customer match lists in observation mode to your current campaigns.

While the immediacy of this measure may come as a surprise to some, it shouldn’t be. This move has been coming for some time and is in preparation for the upcoming departure of cookies in Chrome in 2023. While Google does have millions of users and billions of data points, one thing they do not have is information on what happens to customers once they arrive at a brand’s website. Google realizes that first-party data is at an all-time premium with the depreciation of cookies, and they are working on alternatives to ensure brands can make the most of their user information.

Google has long stated that applying your audience in Observation Mode – on top of smart bidding strategies – helps improve algorithmic learning, but they are now forcing our hand. As with all things, the sooner we can learn the impact of our bidding strategies the better. We believe the timing for this move is so that Google’s proprietary bidding system will have the learnings of the effect of first-party data before Chrome drops its cookies next year. This change calls a few things into question, including the value of remarketing campaigns and if brands need to create similar audiences. Another one to consider is whether the universal application of A.I. customer match will make bidding strategies so advanced to the point that humans managing those strategies will become an obsolete practice.

One thing we do know for sure is that first-party audiences have become the best tool for brands to drive performance within their digital media portfolios going forward. We’ve been saying it for months now and we’re going to keep hammering on this point – brands of all sizes MUST develop a comprehensive first-party data strategy because those that lead in this area will have an outsized advantage in the future cookie-less world.