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How first-party data can mitigate the effects of 3rd party cookie deprecation

Author: Laura Ballam


It turns out, you'll have to find a new way to market effectively to people online. That's the message Google sends to publishers and advertisers with its upcoming third-party cookie deprecation that is set to go into effect in late 2024.

The move is a natural evolution of privacy legislation (think GDPR and CCPA) and new technology requirements demanded by users who want anonymity and privacy on the web. In fact, Google is late to the party. Apple launched its Intelligent Tracking Prevention (ITP) in 2019. Braze continues to block third-party data capture mechanisms. And many others are joining in, so much so that it’s become the predominant leaning of the entire internet to limit access to third-party data points, such as third-party IDs (3PIDs) and Device Ids.  

Why is this a problem? Because this type of data is the foundation of how many businesses understand who's who on the web. Without these data points, marketing, advertising, and many consumer-360 and business intelligence (BI) initiatives will lose the ability to connect the dots across channels. As a result, advertising and marketing complexity will increase, ROI will decrease, and some fraud-prevention activities may even see diminished effectiveness!

And this isn’t just a problem for "technical people." The implications of Google's decision go beyond technical to require businesses build their own high-quality first-party data sets to fill the gaps left by the loss of 3PCs, 3PIDs, and Device IDs.

If you don't act now to remediate your data situation, you'll likely find your organization behind the analytics 8-ball in 2024.

Defining our terms


What are cookies?

Simply put, a cookie is a tiny bit of data placed on your computer by a website that identifies your computer on the web.

What are third-party cookies, and what do they do?

Third-party cookies allow companies to track users across multiple websites to progressively build a picture of who visitors are including their likes, dislikes, and buying habits. This understanding of identity allows businesses to present targeted advertising along the user's web journey based on their interests and behavior. This technology drives most of the advertising, retargeting, and personalization efforts on the internet today.

What are first-party cookies?

First-party cookies are just like third-party cookies, except they only operate on the site you're currently visiting (for example, your website). Their primary purpose is to capture user behavior, preferences, and identity between pages of a website (or across multiple owned domains), save their selected preferences, and store details about the user's session or shopping cart, for example. Keep in mind that a true first-party cookie is placed by the same company that will use it, within their own properties - if it’s not, then it’s a fake first-party cookie and may as well be a third-party cookie, because it will be blocked.

What will be the effects of Google deprecating third-party cookies?

Traditional advertising used to function with a shotgun approach. You'd create an ad, send it out to the masses, and monitor general trends, such as increased sales, to measure its effectiveness.

As the internet evolved, tracking users became more prevalent, and businesses could soon connect the dots between an individual ad impression and a particular purchase by using 3PCs, 3PIDs, and Device IDs. This technological evolution led to hyper-personalization, where many of the shopping and content experiences on the web are dynamically adapted to a user's particular identity and preferences.

Without these 3PCs, 3PIDs, and Device IDs, four immediate impacts will become evident:

1. Collecting and drilling down into customer data will be more challenging.

With the loss of these data points, much of the customer record data and reporting will become less specific. You'll need to find a new way to drill down to the same level of specificity on each individual's behavior. Without an understanding of customer identity, you lose a lot of your aggregated insight into your audiences. You'll again have to rely on an outdated advertising approach that relies on a more aggregated and anonymized view of your audiences. That is, unless you effectively collect and crunch high-quality first-party data to re-establish a sense of customer identity.

2. Ads will be less targeted and less effective and will require more work to see increased ROI.

This loss of identity will result in less personalization and less control over who sees your highly targeted advertising and marketing. Without device IDs and an understanding of identity to correlate to your ad impressions, you'll effectively be flying blind. You won't be able to connect the dots between an ad on an affiliate site and the purchase that customer eventually made.

3. Ad campaigns will take more time and require more work.

Technologies like programmatic advertising also rely on 3PCs, 3PIDs, and Device IDs. Without these data points, you won't be able to purchase ads programmatically based on automated data flows. Instead, you'll have to go back to a more manual way of feeding your campaigns that’ll be more time-consuming and less efficient than automated solutions based on 3PIDs and Device IDs. First-party data can help here, by driving more accurate audience understanding and segmentation which can be used for programmatic ad targeting. Without these data points, you won't be able to purchase ads programmatically based on automated data flows. Instead, you'll have to go back to a more manual way of feeding your campaigns. That'll be more time-consuming and less efficient than automated solutions based on 3PIDs and Device IDs. First-party data can help here, by driving more accurate audience understanding and segmentation which can be used for programmatic ad targeting.

4. You’ll need ways to capture high-quality first-party data.

The loss of third-party cookies doesn't mean you'll never be able to deliver hyper-personalization for customers again. Instead, you'll need to invest in technology to capture and crunch your customer data in new ways. Businesses that don't invest in real-time first-party data capture technology will find themselves at a massive competitive disadvantage come 2024.

3 ways a high-quality first-party data capture solution can mitigate the effects of data deprecation

Machine learning (ML) and artificial intelligence (AI) power a new generation of customer data tools that allow businesses to adapt to the changing landscape.

A high-quality data and contextualization solution enables businesses to capture first-party data in a transparent and compliant way, then use this in real-time to feed their marketing and advertising infrastructure.

1. Capture and own your data to power digital identity resolution

A modern customer context solution will compliantly capture data and build individual identity using an ID graph. An ID graph tracks all user data and compiles it into a picture of who the customer is. It also persists identity across multiple devices, channels, and domains, enabling you to create an even more precise view of the customer than what 3PCs previously enabled.

2. Build a more meaningful business-customer relationship

Opt-in models and aggressive first-party data collection are critical components of any quality data capture solution, but you must do this intentionally and consistently. Unfortunately, many businesses never go beyond a basic cookie collection strategy on their websites. There needs to be more!

You must intentionally curate your customer data-gathering relationship to establish ongoing reciprocal trust. A modern data capture solution gives you the tools you need to do this, but you need to use them intentionally.

3. Adapt to user preferences and insights in real-time

As data flows in, you must evolve appropriately to customer insights and changes in the marketplace or customer behavior that your data capture solution flags for your attention. A data capture solution that doesn't provide real-time activation is like a car without a gas pedal - it's not going to get you where you need to go. Live-time insight is the heart of what a modern data capture solution can do for your business. It helps you to understand customers, anticipate their needs, and develop products and services that meet their expectations.

The future of advertising and marketing is bright (depending on how you respond now)

For marketers and advertisers, the upcoming changes driven by the market's desire for privacy will hugely impact brands everywhere, but there's a silver lining in it all. These changes force businesses to adapt and reach their audiences in new and compelling ways. Companies that do this well will recognize a competitive advantage and set the tone for the future of their customer relationships.

So, are you ready for 2024?

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