The death of the cookie - a Sword of Damocles that has hovered over advertisers and brands alike since Google announced its planned shuttering in February 2020. Kevin Daly, First-Party Data Director at Making Science, explains why Customer Data Platforms hold the solution...
The news of its impending demise was a turning point for the e-commerce industry, forcing online retail brands to rethink their marketing strategies. After the announcement, Google unveiled a timeline for ‘responsible’ cookie phase-out, with its final step set for late 2023.
For many, this pronouncement also signalled the death of ‘easy e-commerce’. But despite the doom and gloom, global e-commerce revenue is forecast to grow to $2.724 billion by the end of 2021. So how can brands and marketers maintain this growth and get ahead even as the cookie crumbles?
Firstly to first-party
Google announced that as part of its Privacy Sandbox initiative, providing stakeholders tools to transition smoothly into cookieless operations, several of its ‘key technologies’ in development – including FLoC and FLEDGE – will be ready a year ahead of the final cookie cut off in late 2023. As developers grapple with this new technology, advertisers will need to prioritise adapting their marketing strategy to fit with the changing landscape.
This strategy should be unique and also be underpinned by first-party data. Though harder to gather than third-party data, it provides marketers with more reliable and relevant information to work with to draw richer insights.
Building relationships with audiences will be key to getting first-party data. Whether through email marketing campaigns, social media or even offline events, by aiming to engage customers throughout their purchasing journey, brands are more likely to gain valuable first-party data whether or not a conversion happens.
However, this will not be simple – Salesforce.com found that 83% of consumers are concerned about sharing personal data online – meaning while the task is not impossible, marketers will need to build trust with consumers in order to collect their data. Brands have evidenced the success of this by increasing their ‘consent conversion rate’ by 20% by testing different approaches, such as the messaging style when asking for consent on their website or app.
In addition to building first-party data, advertisers should consider data activation within their strategy and build a continuous analytics approach to engaging customers, creating a data feedback loop that helps to constantly generate valuable insights and improve processes. The steps to a successful data journey would look like this:
1. Activation planning
2. Discovery and data enrichment
3. Apply customer events
4. Calculate customer metrics and KPIs
5. Contextual data enrichment
6. Data activation
Marketers following this process will draw clear insights and will be able to enrich their data, by synthesising with other data sources - including data outside the e-commerce space.
All under one roof
Once first-party data is acquired it must then be processed to make the assessment stage possible. But bringing together large amounts of data can be tricky, especially when converging information from different sources such as from an app, email or offline. These siloed data sets rarely interact with each other and often contain duplications which makes it difficult for marketers to identify the value in their data, and therefore not optimise their budgets effectively.
This is where a Customer Data Platform (CDP) comes into its own. It should be viewed not just as a tool, but as a solution as well.
Augmenting first-party data, from a variety of sources to create a single vantage point, means brands can create a uniformed, holistic view of their consumers. There are multiple tools available but CDPs tend to conclude faster than CRM, ERP and e-commerce systems. By standardising and unifying the information collected from customers across all user touchpoints, brands are able to better target, optimise and report marketing communications.
The richness of this first-party data also enables marketers to activate the data on a per-customer basis, allowing for personalised and reactive marketing strategies. For instance, marketers can provide more targeted product recommendations based on previous purchase behaviour and web browsing history. This holistic understanding of current customers leads to further growth as well – the data will allow marketers to pinpoint and access new audiences based on previously existing audience profiles.
Ultimately, the death of the cookie means brands and marketers need to shift their focus. No longer can they rely on interactions and conversions derived from third-party data personalisation. Instead insights will have to be based on first-party data modelling to inform a mix of precision and predictive marketing.
Creating a unique, agile and engaging marketing plan to gain first-party data is a must for brands as the cookie is phased out. Combining that properly with an effective platform to manage and sort customer data should empower marketers and allow them to meet customer needs effectively.
By Kevin Daly
First-Party Data Director