Is Google PAIR the New Programmatic?

Recently, Cup O Content wrote about Google's decision to sunset third-party cookies. While we're sure that decision was painful to Google in some ways, the timing of the announcement turned out to be strategic. At the end of April, with great fanfare, Google announced that it is rethinking programmatic ads by offering new ways to leverage first-party data.

PAIR (Publisher Advertiser Identity Reconciliation) is Google's answer to third-party cookie privacy concerns. Instead of allowing all advertisers to use tracking cookies to identify audiences from other sites and apps, it allows advertisers to leverage their own first-party data in comprehensive ways.

What is PAIR?

PAIR uses first-party data, which is collected directly by the advertiser. It may include customer emails, analytics from the advertiser's website, content or membership subscription data, loyalty card data, customer purchase history, and more. It is called “first-party” because it is collected and protected by the company. It is not shared or borrowed.

Qualifying companies can use PAIR to upload first-party data and use it exclusively for their own marketing efforts. But it's not always easy. Instead of simply uploading data to Google, each PAIR must be, well, a pair. It must be done in conjunction with the publisher, and PAIR data can only be used on that publishing platform.

Ads can only be delivered if the user (the person receiving the ads) has an existing relationship with both the advertiser and the publisher. For example, if a grocery store wants to market only to its loyalty card members on a local news website, PAIR would provide a way to do that.

Both the advertiser and the publisher must have big enough datasets to facilitate enough matches to make an ad campaign possible. Because data matches are usually 50 percent or less, PAIR seems to be another tool that is more useful for large companies and large publishers, but it may not be practical for companies or publishers with datasets in the thousands instead of the millions.

PAIR and Privacy

PAIR is a privacy solution that allows advertisers to target specific customers without the privacy concerns of tracking software. PAIR also has safeguards in place that virtually eliminate any chance of data leakage. Data is encrypted on both sides and then held in a secure "clean room" that gates the data and prevents use outside of the PAIR agreement.

Google offered the following example of data security (image courtesy of Google, below).

Pros and Cons

Like any new marketing tool, PAIR offers some clear benefits as well as some challenges. PAIR offers advertisers a new way to leverage first-party data. It also sets the stage for targeted messages that could provide a high return on ad spend (ROAS). Now, advertisers can remarket in new ways to offer deals on repurchases, reminders to restock, sale messages, new inventory messages, product announcements, and more.

However, PAIR is not a tool to attract new customers. It's limited to remarketing and cultivating sales against an existing customer base. Additionally, these customer databases must match with publisher databases, often resulting in the loss of 50 percent or more of the database.

Finally, PAIR is only available to advertisers using DV360, a media placement program from Google designed for advertisers buying upfront and open auction media. So, it's not necessarily a feature for smaller advertisers.

What's Next?

We suspect that PAIR will be an interesting add-on for major advertisers. If it produces successful results, Google may adapt it for smaller advertisers. If you want to know more about PAIR of Google ads, contact Cup O Content, and let's start talking.