Death of the third-party cookie calls for customer-centricity

10 June 2021. Thoughts in Featured, Industry by
Share:

Over the last decade, the way consumer data is collected, used and regulated has changed immensely. Tracking tools like web cookies have allowed advertisers sophisticated and personalised ways to target consumers, but they have also led to privacy violations. However, Google is planning to phase out cookies by 2022, which means companies will have to get clear permission from users to utilise data generated. But because users are more informed about how their data is used, they are unlikely to give their consent.

So, are businesses ready for a future without web cookies?

Sadly, an Adobe survey found that only 37% of businesses are ready for a world without third-party cookies. This inevitable change will leave marketing and media agencies with very little or no first-party data (first-party data is information you collect directly from your audience and their interactions with your product) which takes away all the information required to segment audiences and target them based on their behaviour and demographic.

McKinsey & Company suggests that “marketers and companies that do not figure out a strategy to maintain—and even grow—their access to first-party data may have to spend 10 to 20 percent more on marketing and sales to generate the same returns”. It will therefore be more important than ever to consider new approaches to data-driven marketing. And we’re not talking clever workarounds or technical fixes, instead, a sustainable data strategy will rather look for ways to build transparency-based trust with audiences and to grow strong, long-term relationships with your consumers.

A sustainable first-party data strategy must be customer-centric.

What a sustainable data strategy looks like will differ from company to company, but the goal should be to foster consumer relationships – based on trust – that lead to a value exchange. This could take the form of content or access to publishers and platforms provided in return for personal data.

The value of direct engagement with an audience will become more important than ever and will help to shape strong consumer connections. Publishers and advertisers must look for smart solutions and approaches that will assist them to stay connected with as many consumers as possible – like creating experiences that an audience deems worthwhile.

In the short term, walled gardens (a closed ecosystem in which all the operations are controlled by the service provider, for example, social networks) might provide advertisers with targeting solutions based on their wide reach and their knowledge of an audience’s affinities.

Another helpful approach for advertisers and publishers could be contextual targeting. Because contextual targeting analyses content being consumed and not the specific person consuming it, therefore, it does not rely on third-party cookies. This is a helpful way for advertisers to personalise their content based on contextual information received from a webpage. The key to successful contextual campaigns will rely on bringing together contextual signals and first-party data to help reach and convert consumers who are further down the funnel.

So, it is clear: Those who can quickly find their feet with the new data relationship dynamics may be able to develop a significant competitive edge. But do not make the mistake of only responding to the technical side of customer data management, companies need to build permission-based relationships with their audiences.

New data relationships require the right people, processes, and technologies.

Businesses may benefit a lot more from shifting mindsets and implementing supportive changes throughout their operations. So, a good data relationship strategy and its execution should be a pivotal part of the company’s marketing function. Big companies may even consider appointing a full-time data relationship manager; someone who is versed in business, technology and user experience.

The data relationship manager’s focus must always be on providing the company’s audience with understandable and valuable information. With an agile approach, data relationship managers can run a variety of tests to better understand what it would take to enter a valuable data relationship with consumers.

Due consideration should also be given to the right technologies because a secure infrastructure is integral to delivering on the promise of the data relationship. For example, a secure customer data platform (CDP) can make it easier to manage first-party data. Then there are also consent management platforms that can help to collect, store and manage the necessary permissions captured throughout the customer journey.

Your data value proposition is important.

Customer value is central to data relationships, therefore, a clearly defined and communicated value proposition will bolster customer engagement. McKinsey & Company found that approximately two-thirds of consumers will gladly share their data, or consider sharing their data if they received something of value in return. They also found that the majority of consumers are more willing to share data with a business that communicates a clear, captivating value proposition.

The deprecation of third-party cookies offers businesses an opportunity to really shift their focus to the customer’s experience – especially if it hasn’t been a priority. And while a strong human focus is vital to future success, companies also need to invest in the right technical measures to create a sustainable data strategy.

List of references:

A customer-centric approach to marketing in a privacy-first world [online] Available at:

https://www.mckinsey.com/business-functions/marketing-and-sales/our-insights/a-customer-centric-approach-to-marketing-in-a-privacy-first-world

In a cookieless future, half-baked marketing won’t do [online] Available at: https://www.technologyreview.com/2021/04/27/1023164/in-a-cookieless-future-half-baked-marketing-wont-do/

The big reset: Data-driven marketing in the next normal [online] Available at:

https://www.mckinsey.com/business-functions/marketing-and-sales/our-insights/the-big-reset-data-driven-marketing-in-the-next-normal

The demise of third-party cookies and identifiers [online] Available at:

https://www.mckinsey.com/business-functions/marketing-and-sales/our-insights/the-demise-of-third-party-cookies-and-identifiers

Share:

You may also be interested in the following articles

An agile approach to marketing is here to stay
Kaitoma Creatives
What the rise of TikTok means for marketers
Elizebeth Croeser
Are Your Customers At The Heart Of Everything You Do?
Gerda Le Roux