Last night, Google announced Customer Match, a program that advertisers have anticipated since the Wall Street Journal first reported on its existence earlier this year. Customer Match allows advertisers to segment and target Google search, Gmail and YouTube users via first-party lists of email addresses that the advertiser has collected and that Google can match to its users.
Merkle has had multiple clients participating in this program as beta testers and we are excited about the possibilities it holds, and what it signals about the future of Google advertising.
How Does it Work? Customer Match vs RLSAs
In many ways, Customer Match can be viewed as an enhancement to the capabilities advertisers currently have under Google’s remarketing lists for search ads (RLSAs) program. RLSAs allow advertisers to create audience lists based on the actions a user takes on the advertiser’s site. Advertisers can then adopt different advertising strategies for the different audience lists.
However, the restrictions around RLSA audience list creation (which Google has recently updated and clarified) inherently limit the types of data that advertisers can use to inform their RLSA strategies. Also, a user can only remain on an RLSA audience list for 180 days, unless they take further action on the advertiser’s site. Both factors limit the scale of traffic that advertisers can impact using RLSAs.
By allowing advertisers to use customer email addresses to create lists, Customer Match creates new possibilities for optimizing advertising programs for a different and potentially larger audience, using a richer pool of first-party data. This data potentially includes offline interactions and other CRM data that the advertiser has at their disposal.
To create Customer Match lists, advertisers upload a list of email addresses to AdWords, segmented as they see fit. Google will then attempt to match those addresses to the email addresses it has for Google accounts. Once the audience list is created from the matched addresses, Google will discard the data used to create it.
From there, a Customer Match audience list will offer advertisers similar capabilities as RLSAs to: target or exclude the audience, adjust bids for the audience, and tailor messaging for the audience.
One major addition is the ability to have Google create Similar Audiences of new potential customers based on your audience list. Similar Audiences is essentially look-alike targeting in the vein of Facebook Custom Audiences, which has proven invaluable as a prospecting tool and set a high bar in the space. Upon release, Similar Audiences will initially only be available for YouTube and Gmail ads.
Google Proceeding with Caution, but Direction is Clear
While platforms like Facebook and Twitter, with their respective Custom Audiences and Tailored Audiences programs, may be providing cover for Google to move forward with first-party and user data driven targeting capabilities, Google is proceeding with caution in this area.
As Merkle’s Matt Naeger describes Customer Match in an article on AdExchanger, “Google is launching this program with some very tight guidelines and has been working on how those guidelines can serve both their users as well as their advertisers.”
Google must balance user privacy concerns against giving advertisers greater capabilities to reach the right users at the right time. We see this in the limits Google places on the use of third-party data for RLSAs and the sharing of audience lists across brands. Customer Match will face similar limitations even as it opens up new possibilities.
The reality is that this is the direction where the marketplace is heading though, and even incremental change from a company the size of Google can have large consequences and send a powerful message.
There is value for both advertisers and users for ads to be better-targeted, with more appropriate messaging. At Merkle, we like to talk about these issues in terms of “addressable marketing” and we have been investing in our capabilities to integrate first-party data into digital strategy in anticipation of developments like Customer Match.
In its initial incarnation, Customer Match may not be a game changer for many brands, particularly those already employing RLSAs with success, but it should provide another leg up on the competition for sites that use it in smart ways, and it will be fascinating to anticipate where Google takes it next.
