"The blocking of third-party cookies in Chrome will bring the single biggest change to the digital advertising ecosystem since the introduction of real-time bidding in 2009" (Berger, et al, 2020). This latest change is a further step in a global trend of data deprecation accelerated by legislation such as GDPR and CCPA in 2018.
Third-party cookies have enabled cross-site tracking and retargeting techniques that facilitated the explosive growth of programmatic marketing over the last decade. "90% of digital display ads are traded programmatically" (Sobo, 2020), and global programmatic advertising spending increased by 158% in the last five years (Statista, May 2022).
But the use of third-party cookies hasn't always been a panacea. Jide Sobo describes an unnecessarily complex system with issues of fraud and non-human traffic termed 'the leaky bucket' (WARC, 2020). Data from the ISBA supports this position finding that 15% of a programmatic spend was "unknowable" (Smith, P 2020)
In the wake of recent scandals like Cambridge Analytica in 2016, data shows a turning point in consumers' value of privacy. "70% of respondents associate banner ads with fake news, while 83% feel digital advertising is becoming more intrusive" (Statista, 2022).
To prepare for a cookieless world, brands need to be cognisant of tools at their disposal and the moral compass consumers now expect on issues such as privacy.
1, First-Party Data
With consumers' consent, brands can utilise metrics such as purchase history, time spent on a page and email CTR. Statista's recent 'Cutting the cookie from digital advertising' study forecasts that "First-party data is poised to take centre stage and become the most valuable currency in the online marketing ecosystem" (Statista, 2022).
According to Mallory Fetters of Cox Communications, brands must strike the correct tone and message to succeed. "Fundamentally, what we need to do is make sure that we are highlighting the benefits to customers. How is this going to make my customer experience, my brand experience with you better, highlighting those value propositions when we're interacting about sharing an email address or sharing data." (Analytic Partners, 2021).
Utilising first-party data at scale may pose a challenge for low-price point products that rely on heavy discounting, and brands should consider a value exchange tailored to their unique customers.
2, Partnerships
"Brand partnerships can be used to meet various objectives, such as raising awareness, aligning with a good cause or forming strong relationships, which improves resilience during times of market disruption.
(Guerrieria, 2018)
In 2020, confectionery bar brand Butter Fingers partnered up with the makers of the Final Fantasy VII video game to appeal to younger consumers in the US. The campaign saw a 15% rise in sales and a 900% lift in unaided awareness on Twitch (Voorburg & Kelly, WARC, 2020.
Research data shows that partnerships are most effective at driving perception, consideration and likelihood of a recommendation, but they may have less impact on the perception of value or quality (Gladdice, 2019).
Brands should take special care to avoid negative associations with partners that don't match core values.
3, Contextual Marketing
Also called native marketing, contextual marketing matches ads with the platform's content rather than the user and is a favoured option with consumers. "79% are more comfortable seeing online ads that are relevant to the webpage appear within than ads based on their browsing history, and 65% would be tempted to buy a product from an online ad that is relevant to the web page they are looking at at the moment" (Statista 2022). Although this Gumgum survey only presents a snapshot of a thousand users over two days, it shows a positive correlation, and marketers should take note.
The IAB states, "Advertisers could use contextual targeting at scale as a substitute for cookie-based targeting, since contextual targeting uses information about the content of the page, not bid or impression data" (IAB, 2020). This trend is forecast to grow by 86% in the next five years (Statista, 2021).
Solutions such as deterministic industry IDs, probabilistic industry IDs and Google's topics all show promise. And with "attribution modelling now used by a third of brands (34%), despite challenges around cookie data" (WARC, 2022), third-party data will still have a part to play.
Brands should embrace a holistic strategy that utilises traditional upper-funnel techniques. "Heavy upper-funnel marketing strategies focused on brand equity messaging and channels reaching a broader array of potential new and existing customers - have 65% stronger impacts in the long term." (Analitic Partners, 2021) These three steps are good practices regardless of technological change and will help future-proof brands.
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