According to a report from Bloomberg, Google and Mastercard have signed a secret agreement so Google could track retail of Mastercard transaction data. This is another proof that Google's true customers are the advertising partners.
Online advertising has now taken over all other advertising methods. Businesses spend more on online ads than TV ads, newspaper ads, and more.
And the reason why online ads have become so popular is that it's much easier to track the effectiveness of your ad campaign. If you spend money on Google or Facebook ads, you can directly track the number of customers who end up in your online store because of your campaign. You can even see what they end up buying.
And yet, what if you watch an online advertisement for a TV and then you buy a TV in the store? Technical companies have been trying for years to bridge the gap between online and offline sales. Therefore, Google will always follow your location, even if you turn off Location History. And that's why Google and Mastercard may have signed an agreement.
According to Bloomberg, all Mastercard transaction data are encrypted in the United States and transferred to Google. Google pays Mastercard, and potentially other card networks, to access this information.
Google can not see individual transactions. However, the company may extract relevant information from this pile of data. For example, it can match offline purchases with user profiles. And the company knows about a user clicked on an ad.
Advertisers can upload an email database to match offline sales with Google profiles and ad clicks. Google sends them reports with total offline sales. Advertisers then see how much money they generated thanks to their online advertising campaign.
It's a good way to convince advertisers that their campaign was effective. When these companies think about the advertising budget, there are chances that they will end up spending more money on Google if they see that it leads to a lot of sales.
This strategy shows that building a large-scale advertising business requires some privacy concessions. It's even more offensive that Google does not talk about these deals more publicly. Users deserve to know what's happening.
You can allegedly opt out of this Mastercard Agreement by turning off "Web & App Activity" in your Google Account. But this setting is hard to find and includes tons of things. Disconnected purchases are also not "web" or "app" data, for example.