By Jennifer Wartabedian, digital director, Initiative
Oil and data are valuable assets, but both are becoming increasingly scarce in the region. Enterprises are relying on data to not just survive, but to identify new revenue streams and lead in the new normal. Large innovators such as Amazon, Netflix and Uber have business models centred around effective use of data.
With rigid laws and privacy fears, marketers are beginning to feel the loss of third-party cookies, which leads to challenges in tracking and understanding online user behaviour. While some fear a ‘cookieless’ future, adopting new strategies that rise above cookies will eventually give brands an upper hand in the industry.
What does a cookieless future look like?
Advertisers will depend less on third-party cookies – the traces of data exchanged with advertisers that contain personal identifiers of consumers browsing the web and apps. This greatly affects websites using third-party cookies which can detect consumers and target them with relevant communication and ads.
The direct impact of a cookieless world will be observed in the size of third-party audiences. Audience sizes will deteriorate drastically, and data will no longer be scalable enough for effective campaigns and reach. This will also lead to irrelevant messaging and lower conversions.
To overcome the loss of third-party cookies, marketers should shift to the use of first-party data, which is crucial in the modern and transparent data ecosystem. First-party data manages user identities and allows advertisers to develop customer relationships, while delivering more personalised user experiences, relevant communication and precise audience segmentation.
With this precise and reliable data, businesses can analyse a customer’s behaviour and preferences to address their requirements. You can track a customer’s online behaviour on owned channels such as a website or an app and bring together key insights to enhance their overall experience. Moreover, first-party data reduces overall costs as you needn’t purchase it from a third party. Processing this data may require more time and effort but it will pay off with detailed insights about customers. With first-party data, you can build stronger marketing campaigns with audience segmentation based on demographics, interests, online behaviour and purchase behaviour. First-party data allows you to detect patterns and predict trends. It enables businesses to create extremely data-driven and well targeted campaigns with personalised experiences that strengthen customer relationship and brand loyalty.
The rise of CDP
As enterprises increasingly rely on first-party data and business leaders prioritise their customer information, we have observed an increase in the adoption of customer data platforms (CDPs). A CDP is the essence of an organisation’s customer data as it allows brands to acquire, manage and activate data through various marketing channels such as social, programmatic and video ads. A CDP comes with numerous benefits such as:
A unified database for omnichannel marketing for personalised communication. Every interaction a brand has with its users – through the website, mobile app, email or social media – provides insights into their interests. A CDP can consolidate this data in ways that customer relationship management solutions (CRMs) cannot.
AI-powered personalisation, which can be used to identify potential customers as well as clients who are unlikely to convert.
The main disadvantage of first-party data is its lack of scalability, and that’s why brands need to leverage data partnerships to widen their reach. For instance, we have noticed a rise in data partnerships and collaboration with telcos. They have a massive amount of data that can be converted into meaningful insights using location info at a very granular level. The concept of collaborating with data providers is not new, but recently technology and innovation have improved the efficacy of these alliances across different verticals. Data partnerships are very powerful as they drive valuable efficiencies in marketing and advertising, scale for reaching consumers, and deliver real benefits for consumers.
It is time to accept that first-party data is the future of marketing. With a CDP as a key component of data management strategy, businesses can adapt to the phasing out of third-party cookies by using a single platform to unify and consolidate all first-party data from multiple sources. By embracing this deeper level of data collection, alongside personalised content, businesses can understand customers better and improve their overall marketing performance.