Google have taken its data encryption policy to the next level and companies around the world are asking what it all means. The changes Google announced recently whereby they’ll stop passing search term referral data on to third parties mirror changes introduced last year to organic traffic driven from the search engine.

At the time, this had a significant impact on SEO and data analysis activity, as website owners and marketers were no longer able to view which specific terms were driving traffic to their sites from natural listings.

Google argued they were withholding this information to improve user privacy, but the search engine has faced ongoing criticism for only applying this to free, organic traffic and neglecting to do so on clicks from sponsored listings. It was felt that user privacy concerns were being pushed aside for people who were prepared to pay Google for traffic.

Last month’s move addresses these concerns, with paid and organic traffic now being treated equally. The impact of this varies depending on what website tracking infrastructure your company has in place, though importantly there will be no changes to the data available within the Google AdWords interface.

For those using anything else such as website analytics platforms like Google Analytics, you’ll only be able to see the traffic produced by the keywords targeted by advertisers, not those that were actually searched for by users.

The difference between a search term and a keyword is down to match type targeting in Google AdWords that changes the type of search terms you’ll show ads for. For example, if you target the keyword “social media biz” on Broad match, you could show ads for any searched term which Google thinks may be relevant to it, such as “social network”.

This data is important to advertisers as it allows them to expand their search marketing strategy by understanding what search terms their consumers are looking for and what value they bring to a business.

While you won’t be able to analyse this specific searched term data side by side with other marketing channels through analytics platforms, it will remain in Google AdWords. There’s one caveat to this and that’s when advertisers want to see what revenue, sales and leads came through a particular searched term, not a targeted keyword, they will have to use Google AdWords’ conversion tracking system (ACT).

Analytics platforms like Omniture or Google Analytics are able to show all clicks to a website that were made by a user prior to the purchase taking place, ACT actually only knows about AdWords clicks, not journeys that touched different marketing channels.

This means that ACT would allocate the sale to the Google advertising activity every time, regardless of whether the user engaged with other forms of advertising before and after clicking the paid search ad. The result is that ACT will always overstate paid search sales when compared to third party analytics software, making it seem like Google campaigns are driving more conversions than they can usually be credited with.

Also with the recent addition of ‘estimated total conversions’ data into ACT, data which up weights the impact of AdWords campaigns on site sales and conversions even further.

These changes announced last week are going to have minimal impact on a well-constructed AdWords campaign and ultimately won’t disrupt most advertisers’ marketing activity. User privacy was the driving force behind the changes that have been made, but the knock-on impact with increased ACT uptake will definitely be a happy coincidence for Google.