With regulatory and privacy changes preceding a cookie apocalypse, brands face important questions as we head into 2021.
For decades, cookies have served digital marketers as an important part of delivering personalised customer experiences and data-driven marketing, whether that’s through audience profiling, retargeting, or analytics and measurement.
Many consumers value personalised experiences and expect this to continue. In fact, SmarterHQ have found that 72% of customers only engage with marketing messages that are personalised and tailored to them.[1]
However, consumers are also increasingly disappointed by existing data practices, particularly when it comes to online data. This has manifested into stronger data privacy legislation, such as the GDPR and California Consumer Privacy Act (CCPA), as well as in decisions by major web browsers to change the way cookies track users when we use the web.
Safari and Firefox already have restrictions on first and third-party cookies, which many marketers still depend on. And Google, who’s Chrome browser commands 66% of the global market share, have announced they intend to end support for third-party cookies by 2022.
What does this mean for marketers who rely on cookies in their measurement and advertising? In our playbook for the ‘Cookie Apocalypse’, we address how businesses can adapt to this change in the two affected areas:
- Measurement
- Audiences
Measurement
Digiday recently undertook research to illustrate the impact that browser and regulatory changes are having across the industry. According to their findings, this could cause up to 30% tracking loss on users[2], a perceived drop in return on ad spend, and potentially 15% revenue loss for advertisers who under budget.
Here are three things you can be implementing now to help you minimise the risk to your business.
Begin Implementing Google Analytics 4
Google Analytics 4 (GA4) is built to address the needs of a cookie-less future. It is a new, more intelligent Google Analytics with machine learning at its core to automatically surface insights and give a complete understanding of customers across devices and platforms.
The Consent Mode feature in Google Tag Manager allows the passing of user consent back to Google platforms and enables altered measurement depending on whether users accept or refuse. GA4 is expected to use a privacy safe, conversion modelling approach to fill in gaps where reporting data may be incomplete.
As a leading Google Analytics 360 Sales Partner, we are excited to continue working with Google and our client partners to implement and consult as we migrate to GA4.
Optimise Your Privacy UX
In recent years we have seen a significant step change in how websites and apps manage cookies with their users, with implied consent rightly being phased out and greater adoption of technologies to allow users to manage their preferences. This is creating a more standardised experience across websites, but brands are often missing an opportunity to engage with their users to gain consent and go on to deliver those personalised experiences that they desire across the user journey.
At dentsu, we combine our UX and A/B testing expertise with strong consideration of data privacy requirements, to enable our clients to speak to their users in a familiar language, be transparent about their data privacy policies, and reduce friction for users opting into marketing whilst also helping to ensure experiences remain compliant. We call this approach Privacy UX.
Key to this is the use of user-led insights obtained from data, research, and media sources as the primary driver for optimisation. We then adopt a test and learn methodology through both performance and A/B testing, ensuring that changes are driving performance around opt-in and progression rates and any further optimisation opportunities are captured and fed back into research and testing plans.
Upgrade Your Measurement Toolkit
As well as tapping into what’s on offer from existing technology, the framework of how you measure is key. By bringing together digital attribution, incrementality testing and Market Mix Modelling (MMM) there is the opportunity for marketers to build a measurement framework with less reliance on cookies, to get the fullest view of performance and effectiveness.
This starts with objective setting and defining what you want to solve with measurement.
Selection of appropriate methods should follow but there needs to be a clear understanding of limitations, while intelligence is still a key factor. This process should facilitate as broad a perspective as possible and allow consideration of short, medium and long term objectives.
Audiences
Advertisers spend billions annually on acquiring third-party audience data to target personalised ads. As third-party cookies are removed from browsers much of this will no longer be possible – in its current form at least. But, how do you reach your target audience without third-party cookies?
Leverage Advanced Contextual Targeting Solutions
Advancements in AI and machine learning have seen the dawn of a new era of contextual solutions. Traditional contextual targeting enabled advertisers to place ads in relevant, brand-safe digital environments. However, advanced semantic and image interpretation, alongside machine learning has enabled us to uncover deep insights around emerging trends and sentiment to aid strategic decision making and fuel innovative media activation opportunities.
To fuel contextual advertising solutions for our clients, dentsu have developed a proprietary in-house contextual data platform called Contextual Intelligence. The platform offers an end-to-end solution, from analytics to better understand sectors, brands, competitors, and market trends, through to powerful activation capability which use contextual data signals to optimise media performance.
Have A First-Party Data Strategy
Without cookie-based identifiers, it’s crucial for brands to have an effective identify management approach that prioritises first-party data and understands how to use it ethically and transparently, to win trust with customers, and how to harness it for better marketing. Boston Consulting Group have found that organisations that are able to use first-party data effectively may see up to 2x better performance, and 1.5x cost efficiency[3].
To do this, every organisation needs to have a first-party data strategy which considers how this data is collected, stored, accessed, and activated in their communications channels. This could be paid media channels such as search, social and display, or owned platforms like a website or app experience. And customer segments can be used in many platforms for not only retargeting and cross-sell tactics with existing customers, but also prospecting activity amongst new potential customers, by using in platform capabilities to find similar audiences.
Are you ready?
There is no doubt that privacy is evolving, and the era of cookies is ending. This is already affecting marketers in several ways, disrupting many common, cookie dependent approaches in measurement, analytics, and audience targeting.
To combat this, marketers should upgrade their measurement toolkit, and look for cookieless approaches to reaching audiences online.
Google Analytics 4, Privacy UX, incrementality testing and MMM are set to be major themes this year for marketing analytics teams.
When it comes to reaching audiences without third-party cookies, contextual targeting is taking centre stage, powered by new data and tech capabilities. And those organisations that can effectively use first-party data can personalise their digital experiences and drive higher value customer relationships.
Change is on the horizon; is your data strategy ready for the cookieless future?
[1] https://smarterhq.com/privacy-report
[2] https://digiday.com/media/digiday-guide-everything-you-need-to-know-about-the-end-of-the-third-party-cookie/
[3] BCG, Responsible Marketing with First-Party Data