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Google’s FLoC Enters Testing Phase on Chrome to Transform Interest-based Advertising

Advertising trends are all set to get a massive push toward interest-based targeting. In the latest Google update, the company was found to be testing the Federated Learning of Cohorts (FLoC) algorithm on Chrome. Changing expectations from advertising has influenced the entire value chain of AdTech developers, website marketers and publishers to look for safer and trustworthy solutions to keep the web ecosystem free of issues, including the ones related to malvertising and bot audience. When Google Chrome announced Privacy Sandbox, it was perceived as the advertising world’s biggest development — providing new context to data audience data management and cookies analytics. The goal — eliminate risky privacy frameworks associated with third-party cookies and bring in viable privacy-first alternatives. Anywhere on the web — mobile or desktop, people’s privacy will be protected, that’s what Google promised in January this year.

What is FLoC?

And, the key to Google’s advertising success is entirely based on ‘Interest-based’ targeting and analytics. The engine that will drive its success is labeled as FLoC — a Privacy Sandbox technology for Interest-based advertising. It is based on the idea that unique groups of people can be identified, tracked, and targeted based on their common interests, which would definitely replace the need to track and target “individual identifiers”.

What FLoC Promises to Deliver?

As per Google, FLoC testing would help advertisers to replace their cookie-based approaches and focus on pure-bred advertising analytics based on people’s behavior. This would help in preventing fraud using advanced metrics and anti-fingerprinting techniques. In short, Google is projecting its Privacy Sandbox technology as the ‘future of web advertising’ in the post-3rd-party cookie world.

Keywords Related to FLoC Algorithm

We identified certain keywords that would be at play once FLoC Technology is fully adapted for web browsers. Here are the list of keywords web advertising teams should know to include in their post-third-party-cookie approaches.

Interest Cohort

In digital advertising, a cohort means a group of web users having a statistical factor (such as age, shopping behavior or class membership) in common in a demographic study. Google’s FLoC technology is targeting users around the web, based on their ‘interest cohort’ – which means, the advertising targeting would focus on the groups of people who demonstrate similar web behavior, analyzed from their recent browsing history. FLoC would work in a dynamic manner to recalculate browsing metrics based on location data, device history and browsers. The data would stay private and not shared with vendors or anyone else.

Adtech

Adtech is the umbrella term used to define a set of digital advertising software, tools and solutions that advertisers use to create, test, analyze and deliver their advertising campaigns. These could be categorized into website adtech, mobile adtech and social media adtech tools. In recent years, video advertising technology and Data management / audience data tools have also joined the long list of adtech solutions for native and programmatic advertising.

Google Marketing Platform (GMP) offers its own adtech stack to customers, enabling them with advanced adtech solutions and analytics for better customer insights and behavioral intelligence to drive highly-refined marketing and advertising campaigns. FLoC technology is expected to further accentuate the analytical prowess of GMP adtech stack.

Privacy Sandbox
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According to this blog, “the Privacy Sandbox is a series of proposals to satisfy third-party use cases without third-party cookies or other tracking mechanisms.”

The FLoC algorithm sits on top of Privacy Sandbox to eliminate the risks of privacy infringement and device fingerprinting, thereby bringing in a much safer advertising experience without compromising either user’s privacy or ad relevance.

Does FLoC Use AI and Machine Learning?

The answer is a straightforward “Yes”. And, it’s great to see the AI ML applications getting synced with programmatic advertising solutions from Google. FLoC is built using Machine Learning models that predict the overall probability of a user matching the interest cohort and predict the conversion of that user for better ad placements in the future based on auction bidding for advertisers.

The AI ML in FLoC is also capable of delivering a better content experience through native ad placements that don’t dilute messaging on any device or browser.

Interest-based cohorts would be able to consume relevant content displayed alongside ads that they are most likely to click and shop from.

Another interesting application of AI Ml in FLoC is the way it will block sensitive cohorts from the database. Sensitive categories include race, sexuality, financial data and medical history.

Cohorts that might reveal sensitive categories such as race, sexuality, or medical history will be blocked.

Can Publishers and Websites Opt-Out of FLoC?

Yes, the technology allows websites to opt-out of FLoC calculations.

How FLoC Works?

Here’s a  graphical workflow of how interest cohort-based advertising works using FLoC algorithm.

Diagram showing, step by step, the different roles in selecting and delivering an ad using FLoC: FLoC service, Browser, Advertisers, Publisher (to observe cohorts), Adtech, Publisher (to display ads)
author: Sam Dutton
[To share your insights on Google’s cookieless initiatives and adtech developments, please write to us at sghosh@martechseries.com]

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