24 FEB 2021
The end of the cookie is nigh and advertisers are fretting about how to prepare. MediaCom's Vanessa Newkirk outlines three key areas to take action and future-proof for a cookie-less world.
It’s been more than 25 years since computer programmer, Lou Montulli, launched the cookie. Since then, third-party cookies that have played a large and important role in consumer profiling and re-targeting for advertisers since, which has been a big source of growth for brands.
But now the cookie is about to enter the empty biscuit tin of history as Google prepares to follow in the footsteps of Mozilla and Apple, which both opted out of the cookie ecosystem in 2019.
Google’s decision is a much bigger deal, impacting 63% of the world’s browsers – in some countries the figure is as high as 83%, marking the company’s 2022 commitment as a significant moment for the industry.
Without quick and timely action, many brands will be confronted with challenges right across their digital ecosystem, as technology, measurement, inventory, strategy and creative are all hit. Brands will need to find new and creative ways to ensure their online ads can still be targeted and tracked. They will also need to tweak how they invest to prepare.
While there is no one-size-fits-all approach to addressing this challenge, there are three important areas to consider in the lead up to a post-cookie world:
1. Real, permission-based first-party data reigns supreme, but not without implications
The death of third-party cookies will no doubt mean a heavier reliance on first-party data. Data assets that have identifiable attributes (e.g. email address, phone number, physical address) will, of course, come with a premium. However, there are more challenges to consider.
With increased use of first-party data comes increased privacy implications. Consumers are savvier than ever before when it comes to advertising and data privacy laws and the more knowledgeable people become, the less keen they are about how, when, where and with whom their data is shared. Consumers are becoming their own walled gardens. This creates a conflict between precision marketing and personalisation and consumer privacy.
To address these privacy implications, some brands and advertisers will need more help in ensuring their first-party data collection strategy is ethical, legal and robust than others.
Conversations need to start now with all stakeholders – agencies, marketing, sales, legal and IT teams – about creating organisational processes and marketing strategies for the future. There should be a review of the strengths and weaknesses of first-party data collection strategies and opportunities available.
2. ID Resolution will be the hallmark of the future, but this requires technology and data partnerships
Third-party cookies enabled us to recognise user IDs across domains – and our reliance on them via Google is what’s causing our angst. Unfortunately, in the new world of 2022, there will not be one universal ID. Instead, businesses and brands need to build their own ID Graphs based on their own data and that of partners. To do this, they will need to have proper data partnerships and technology stacks in place to resolve (connect) all the disparate data points (ID Resolution).
While major tech companies such as Facebook and Amazon are experts at using ID graphs, think “who you might know” friend recommendations on FB and product recommendations on Amazon, most brands are just starting to build their own Customer Data Platforms (CDPs), a collection of software used to stitch together data points to create a single ID that then can be activated across marketing channels.
These are not simple structures so brands need to start looking at their own data, the use of data partners and sources, and the exchange of value they can offer to the consumer.
Customer data platforms extend beyond the website (Tealium)
3. Walled Gardens will strengthen their grip, data partnerships will grow
Platforms such as Facebook and Amazon are experts at data and their size, coupled with the demise of third-party cookies and lack of a universal ID for brands to use, will strengthen their position in securing online advertising spending.
Google and Facebook are power players in the digital ecosystem with the largest percentage of digital investments going towards their platforms. However, with the increased focus on ecommerce, Amazon is becoming equally powerful.
These walled gardens can’t be ignored; brands can work with them to leverage data in a private and compliant manner (via data clean rooms). Similarly, data partnerships with publishers outside of these walled gardens will also become important to enriching addressable audiences as well as segments powered by first-party data, informed by ID graphs, and activated via customer data platforms (CDPs).
Brands need to be one step ahead if they are to soften the loss of what has been up until now an integral part of their advertising strategy.
Now is the time to prepare for the future by establishing avenues for education, organisational process alignment, and test and learn initiatives for data alternatives before the cookie crumbles.