The last few years has seen the tech industry pivot and try to manage the backlash against personal data collection. Safari, Firefox and Chrome have all phased out third-party cookies, which has until now made up the bulk of advertising data online. Their focus has turned to using their own vast eco-systems to create walled-gardens of first-party cookie data to keep advertisers targeting users solely within their platforms.
The latest development, Apple’s roll out of IOS 14.5 and the App Tracking Transparency (ATT) network, is likely to have huge implications for Facebook’s business model, which relies on targeted advertising for 99% of the company’s revenue.
Indeed, early indications suggest that given the opportunity to opt out of data collection by IOS 14.5, approximately 80% of users will do just that.
It seems clear that increasing unease with how big tech are collecting data is bound to start coming back to bite advertisers with greater frequency. For large advertisers in particular, the need to take control of your own data and build more reliable, trust-worthy and valuable pools of zero-party and first-party data sets will become the big topic for marketing and technology alike.
What does this mean for businesses who rely on digital targeting and customer segmentation?
Here are four areas I think successful businesses will invest in to continue to grow:
Experience is more important than ever
It’s more important than ever to ensure users want to interact with your brand directly. Creating environments online that are searchable, useful and delightful to use must be a priority for firms in the new cookie-less world.
Prioritise the journeys on your site that add most value to your users and look to optimise them to drive performance. Have a user testing strategy in place to enable the business to constantly optimise as your users’ expectations evolve over time.
Finally, close the loop on experience with valuable and differentiated CRM programmes. Think about where the value lies in the relationship between yourself and the user. What are your shared interests and purpose? Where can you add value to their lives based on your unique position in the market? These added experiences will keep users coming back to you and reduce your reliance on 3rd party cookies and tracking.
Invest in your own data platforms
Where you have scale, a broad customer base and product selection, your business will benefit from investing in a customer data system to hold, manage and activate all your zero and first-party data.
Five to ten years ago, the trend was for businesses to invest in data management platforms (DMPs), as a way of targeting anonymous customer segments via ad networks. Shifts in regulations and trends around data privacy have meant that more frequently we’re seeing these same businesses pivoting to CDPs (customer data platforms). CDPs work differently by consolidating and unifying customer data from various channels, including known-first party data, to enable both CRM targeting campaigns and more traditional personalised ads.
Businesses have more control over the personally identifiable information (PII) data which gets stored by the CDP, than they do with a DMP, making it the technology of choice for many businesses in today’s climate.
Build mutual value exchange
The onus is now on advertisers to collect, utilise and protect consumer data at a zero-party and first-party level and organisations need to incentivise users to submit that data.
Never has it been more important for advertisers to create clear value exchanges for users. If advertisers want users to willingly submit their data, then they need to do more than simply sell services and fulfil purchases. Creating relevant and valuable exchanges as part of experience has become imperative.
Those exchanges differ depending the type of business you are and the type of industry you’re in – if you’re a retailer then loyalty schemes and promotion offers are likely to be valuable to your user base. If you’re a bank, then it might be a proactive and personalised money advice service. The opportunities that existing to engage in value exchange are limitless, just as long as you ensure they’re relevant.
That means ensuring you have a clear data governance policy in place. If you’re going to be collecting more customer data, you’ll need to ensure that data is safe, that there are systems, standards, and rules in place, and that you have a team ultimately accountable for handling that data.
Ensure that your entire organisation is aware of and adheres to the principles of the data governance policy, and that your data policy is visible to your customers. A transparent data policy creates a clear contract of trust between your business, your employees and the customer.
Don’t hide behind legal jargon. Speak in plain language so it’s understandable to the user, and where possible, ensure that you keep that consistent to your brand tone of voice to show that you’re one organisation connected.
The power balance is changing…
The time has come for advertisers to take control of their own eco-systems and with that, their own data collection efforts. The balance of power is beginning to swing back to the consumer in terms of their rights and understanding how their data is used, who it gets shared with, and how much value it holds.
Businesses that understand this value and build the right experiences that collect, protect and utilise data with a customer-first mindset, will be the businesses that successfully navigate the new cookie-less, data safe world.