The end of the cookie is nigh… yadda yadda yadda, you’ve heard it already.
But do senior marketers really understand what the new age of data privacy means for them on a practical level? I'm not so sure.
I don’t like to be a fatalist, but it’s actually baffling to me that more marketers aren’t talking about what the cookieless era means, and what we should be doing about it.
BCG put out a fantastic piece about first-party data (I highly recommend you read it), but one thing I don’t think it stresses enough is that a solid first-party strategy shouldn't just be a long-term goal.
It’s about to become imperative for digital marketing.
To put it simply, big tech firms won’t track users around the internet for us any more. We must take responsibility for our own first-party data collection.
This isn’t bad news for the industry as a whole – far from it. But it’s going to be a problem for marketers who don’t take action now.
What the data privacy revolution means for marketers
Major data privacy changes like ITP and CCPA have had plenty of media coverage already this year. However, it bears repeating that government legislation and major tech providers are both taking action to protect user privacy, by reducing third-party data tracking and requiring clear consent mechanisms for data collection.
Things are changing drastically, and ignoring or resisting it is the worst thing anyone could be doing.
To name a few of the upcoming changes: Apple’s iOS will soon allow users to disable tracking between applications, Chrome is on its way to blocking third-party cookies, and it’s likely that other jurisdictions will follow California’s recent push for privacy regulation.
As a result, a lot of things marketers have relied on are going to be breaking (for example, frequency capping, post-view tracking, post-click tracking after one day, audience segmentation, creative sequencing, and effective audience targeting).
We’ll have a reduced ability to attribute conversion tracking, execute bidding strategies, and target relevant audiences, in other words, the fundamental pillars of performance marketing.
Act now to mitigate data loss (and maximise performance)
I can’t stress enough the importance of taking steps to prepare for this today.
The only way to future-proof your approach to data collection is by reducing your dependency on third-party cookies and capitalising on first-party data.
If you haven’t begun this process, your top priority right now is to audit your data set-up to review your tracking implementation and forecast impact. Then, you can go on to enhance your data collection and leverage insights.
I’ll admit that this isn’t a one-and-done thing, and I hate to be the bearer of bad news, but I’m afraid you don’t really have a choice in the matter.
There will be some technical obstacles, no doubt about it. Is your tracking implemented correctly? Does your tech stack enable data sharing?
(Side note: I honestly can’t believe that it’s 2020 and some advertisers don’t own their own data yet – but here we are. Advertisers need to ensure that with their tech licences and media partnerships, they have ownership over their data.)
Then there’s the organisational roadblocks, for example, do all teams have access to relevant data? Do you understand how to be compliant with regulation, and communicatie transparently with users to obtain their consent? Do you have the necessary technical expertise?
Internal silos will need to be broken down and nuanced conversations will need to take place about what might be a performance problem versus a data problem.
Reviewing everything from tech stack and tracking accuracy to KPIs and compliance will take a lot of work, but it will pay off in more ways than one.
Data privacy is good for the industry
Whatever it may take, a pro-data privacy mindset is the only way forward.
This isn't an anti-personalisation thing. The reality is that consumers like relevant experiences (Accenture found that 83% of consumers are willing to share their data to create a more a personalised experience).
But relevance requires data, and to collect data responsibly you need consumer trust. Which is currently lacking: according to the Pew Research Center, 79% of US adults assert they are very or somewhat concerned about how companies use their data.
Trust takes transparency.
This year Global Web Index research has shown a decline in concern around privacy in Europe, and Deloitte has found that in the UK consumers are not only less worried about the use of their data every year – they are willingly sharing more of it.
The reason? Europe’s pro-privacy regulation in recent years has shifted consumer mindset.
This tells us that if a) consumers know that their data is protected by regulation, b) they are able to give informed consent to sharing it and c) they understand the value this brings in the form of free services and personalised experience, they don’t mind sharing their data.
That’s a win-win for everyone.
Looking beyond: the true potential of first-party data
There’s a lot more to first-party data than pure survival.
Many companies collect data, but they don’t do anything with it. They fail to integrate it for full visibility of the customer journey, and don’t activate that data for high-level insights such as bidding to margin and predicted lifetime value.
BCG found that advertisers who effectively link their first-party data sources stand to double their incremental return on advertising spend versus advertisers who do not.
It’s the differentiator of the decade.
There is so much potential with predictive modelling to optimise towards the future which I haven’t got into here. First-party data equals better experiences, maximised lifetime value, and increased customer retention.
We’re about to embark on a rapid evolution of business, media, and creative strategy.
If you’re not coming along for the ride, you won’t just be left behind – you might as well quit marketing now.
Daniel Gilbert is chief executive of Brainlabs