Whether You Buy Online or in Stores, Google Will Know

Google, like other internet giants, makes its money from online advertising. So it must pander to advertisers -- assuring them their ads are working -- and consumers, convincing them that the personal data used to serve targeted ads aren't violating their privacy.

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The company's latest attempt, currently in beta testing, will let marketers track the success of their ad campaigns online and in brick-and-mortar stores, thanks to Google's recently developed capability to identify purchases that consumers make with their physical credit or debit cards.

Google now plans to use artificial intelligence algorithms to augment the credit card transaction data to which it already has access, allowing advertisers to determine how much in-store revenue can be attributed to their online ad campaigns.

For an example of why such an ability is catnip to advertisers, consider the U.K.-based Holidays division of Richard Branson's Virgin empire, a Google advertiser. Google said in a blog post that Virgin Holidays has determined that a customer who purchases something in a physical store after clicking on an ad appearing in Google search results is three times more profitable than a customer who buys something online.

For consumers, the prospect of Google extending its data dragnet into physical stores is worrisome, especially since there's no third-party ad blocker you can activate while you're standing at the cash register. Thanks to third-party vendors, Google said it's able to capture approximately 70 percent of credit and debit card transactions in the United States.

But Google's early motto was "don't be evil," and the company apparently still takes that to heart. Once the program goes live, you'll likely be able to limit its ability to track your purchases by activating Google's blanket opt-out option for targeted ads. The company said it also plans to encrypt the data it gathers from physical stores to keep them safe from hackers, as well as subject them to its privacy policy.

"While we developed the concept for this product years ago, it required years of effort to develop a solution that could meet our stringent user privacy requirements," Google said in a statement to the Washington Post. "To accomplish this, we developed a new, custom encryption technology that ensures users' data remains private, secure and anonymous."

Still, when ad revenue is on the line, even Google has shown that is willing to modify its privacy rules. Last fall, for example, the company added a line to its privacy policy that allows it to deliver targeted ads to people using their browsing history from across the Google ecosystem.