How to navigate a cookie-less world

Digital marketing is facing upheaval as two of the biggest players in tech wield their power as regulators of internet privacy. How should marketers respond to the challenge?

The ability to track customers as they browse the web could soon become a thing of the past for marketers. Google is laying the groundwork for a future without third-party cookies, while Apple’s attack on app usage tracking via the unique identifier for advertisers (IDFA) assigned to each of its devices is limiting firms’ capacity to monitor customers’ online activities. 

These developments are the result of a backlash against such surveillance from consumers, who are becoming ever more aware of how much valuable data they have been giving away.

Apple’s iOS 14.5 update in April obliged iPhone apps to start seeking permission from users to track their online movements through their devices’ IDFAs. The mobile operating system’s default state has, in effect, changed from opted in to opted out of tracking. Only 13% of iPhone and iPad users had opted in by the end of May, based on figures compiled by app marketplace Flurry. 

Businesses are having to adapt to this severe limitation on their ability to follow consumers’ digital footprints. Three-quarters of marketers responding to a poll conducted in September 2020 by the Mobile Marketing Association and AppsFlyer agreed that both Apple’s and Google’s decisions would reduce publishers’ advertising revenues, for instance.

Despite this, the early indications are that few companies are well prepared for these changes. Only a third of marketers say the brands they work with have made plans for a post-cookie future, according to research conducted by the World Advertising Research Center (WARC) in 2020. So what should those other two-thirds do?

From third-party to first-party data

Ebay’s general manager of UK advertising, Harmony Murphy, acknowledges the problem but is seeing it as an opportunity too. While third-party data has been a mainstay of the marketing industry for more than 20 years, the move to first-party data should be seen as a chance to improve advertising, she argues.

“This moves marketers from being less subjective about that data to being more objective. Using first-party data provides a lot more relevance because it’s coming straight from the source,” Murphy says.

There are people burying their heads in the sand and saying: ‘We just need to find another way of replicating cookies.’ They are going to struggle

Some of the UK’s biggest publishers and advertisers have joined forces in a bid to harness the power of first-party data. One such collaboration is the Ozone Project, which claims to offer brands the ability to reach 99% of the UK’s online adults “with trust and transparency” by combining the readerships of publishers such as Guardian Media Group, Telegraph Media Group and Bauer Media. (News UK, the parent organisation of the newspapers publishing Raconteur reports, is also a member of the project.)

Data collection challenges

Yet not all organisations are able to collect reliable first-party data, because they don’t have the infrastructure in place to gather that level of detailed information on consumers or, if they do collect it, they can’t then parse it correctly. Just over 40% of marketers responding to the WARC survey did not agree that their companies had a plan for actively collecting first-party data from customers.

Despite this, some ad industry insiders are sanguine about the post-cookie future. Matt Dailey, chief performance officer at agency network Havas Media, is one of them. He says that the upheaval provides “the opportunity for those of us who want to be honest to stop pretending about the all-pervasive power of digital. We can actually get back to some proper media-planning principles that have always held true, but have been bastardised somewhat.”

Dailey, who thinks that some brands have become too reliant on cookie data that can often be flawed, adds: “From a planning, channel-allocation, value and measurement point of view, it’s going to help us correct the balance.”

Make do and mend

For brands eager to maximise their reach, Dailey suggests that search can be a useful replacement for third-party cookies and app tracking. “Search has always been underplayed, because people think of intent as: ‘I want to buy a phone on O2.’ But there’s so much generic opportunity further up the funnel where people are demonstrating intent,” he says.

Some high-level data on demographics will still be available, Dailey points out, meaning that it will become more important to go back to core principles of marketing, such as relevancy, quality and effective storytelling. Retooling campaigns to focus less on frequency and more on quality will reap benefits, he predicts. 

“There are people burying their heads in the sand and saying: ‘We just need to find another way of replicating cookies.’ Those people are going to struggle, because Google has said that it won’t support any technology that simply tries to replicate cookies,” Dailey explains.

For those businesses that want to retain an element of the digital approach they have spent the past decade or more honing, there are opportunities. For instance, long before the beginning of the end of the cookie era, eBay used its first-party data to help support customers. 

“When targeting, this means using that first-party data in a really intricate way to ensure that you’re enriching that consumer journey,” says Murphy, who adds that the freedom from a bombardment of ads is a boon for customers. “It keeps them within the ecosystem to a degree that they want to be within it.” 

Ebay is not alone. Adobe’s head of product marketing, Ryan Fleisch, says: “We saw the writing on the wall with some of these changes and the need to evolve to include more durable identifiers. There will definitely be short-term pain for a lot of those companies that feel they need to reimagine different pieces of their business.” 

But he adds: “If you’re one of the brands that effectively manages that over the next 12 months or so, you’ll be leapfrogging many of your competitors that won’t be ready.”