Marketers Will Need To Reframe Their Approach As Third-Party Cookies Crumble

Co-Founder/CEO of Vujà Dé Digital, on a mission for conscious capitalism and reinventing the media agency model.

Since 1994, the marketing and advertising industry has been playing an identity game with third-party cookie data, relying on data matching to indicate that someone is who they think they are.

This guessing game has led to some annoying — and, at times, inappropriate — customer experiences. Consumers have been commonly targeted with advertising messages for products they have no interest in, are offered a product they have just purchased, or feel the company doesn’t recognize them as a customer because of the impersonal messaging they receive at times.

Agencies that have relied heavily on automation and third-party cookies, with a more hands-off approach to campaign management, are going to feel the greatest impacts of this shift toward a more (third-party) cookieless future. The agencies that have always deployed and executed media based on hard performance objectives will feel it the least. Simply setting up a Facebook campaign and hitting the “automate” button won’t be so effective for some agencies anymore.

Apple, Firefox and Google started limiting third-party cookies on their web browsers some time ago. In addition, with Apple’s recent iOS 14.5 update, consumers will have more control over their mobile phone app data and how it’s being used by companies like Google and Facebook. Each of these players has a vested interest in their solution, and there is unlikely to be a single winner in the end.

It’s time that marketers and the advertising industry find a way to strike a balance between profitability and consumer privacy. The fact that marketers have relied on third-party cookie tracking for close to 30 years is a feat in and of itself, given the pace of change in digital marketing.

The million-dollar question is: What will be the ultimate solution to the elimination of third-party cookie data? First-party, privacy-proof datasets have always been far superior to third-party data. Previous cookie matching, used by DSPs (demand-side platforms) and DMPs (data management platforms) to warehouse internally owned data and third-party data sources, was messy and not completely accurate. Third-party data was just easier and faster for campaign implementation. But first-party datasets have always been richer and more impactful at driving campaign performance.

First-party data will outperform third-party cookie data any day. This change puts the onus on brands and marketers to truly build a customer relationship where consumers are willing to let brands use their information because they see the value in doing so. Regardless of the new solution to elimination of the third-party cookie, as long as there is an open and fair exchange of value that is transparently communicated to consumers, they’ll be more apt to get on board and become part of the solution.

Multiple approaches to the elimination of the third-party cookie are being developed simultaneously across the industry. Google has been clear that it will not implement user-level consumer identifiers to replace third-party cookies. Of all parties, Google is in the catbird seat with all of the first-party data it collects. However, Google has indicated that it will provide an extra level of support to advertisers who have direct first-party connections with their own customers. This makes developing customer relationships even more important.

Google is proposing a new browser standard that enables interest-based advertising without letting advertisers know an individual consumer’s identity.

The Trade Desk has taken the most proactive position in driving the creation of a new alternative to third-party cookie data that applies across the digital ecosystem. Their development of Unified ID 2.0 creates an identity solution that improves consumer control while preserving value exchange between the advertiser, publisher and consumer.

As a result of these changes, we see a shift back toward contextual relevance becoming a major consideration in media placement and more the norm. The user journey, along with collection and ownership of first-party data, will be a priority for any good marketer. Finding ways to cultivate customers and factoring in the user experience expected as a result of being exposed to an ad will become a fundamental requirement. The value of actions beyond just purchases will become of greater importance for good marketers.

With these changes, I anticipate the life cycle we look at to determine audiences exposed to ads will become shorter. Seek proxy signals that indicate influence in shorter windows, such as how much time a user spent watching an advertising video spot on YouTube. Finding ways to use those proxy metrics to effectively create longer-term marketing strategies that keep users engaged longer, will be crucial.

I believe we’ll see more emphasis on and interest in observing what consumers do an hour, a day or a week after seeing an ad. These insights will become more important as third-party cookies go away. Knowing what to do as a result of these actions along the buyer’s journey will determine your level of success. Determining the most effective next step in the consumer journey and how to use ads to drive those next steps will become a critical factor. This is where the real “talent” will show up and trump the automated scale that advertising has become overly reliant upon.

While no one-size-fits-all solution currently exists with the elimination of the third-party cookie, the progress made in creating a more equitable and transparent marketplace for all is commendable. Here’s to the continuation of transparency and more equal balance of power within the entire advertising ecosystem.

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Author: Todd Juneau, Forbes Councils Member