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While third-party cookies have enabled programmatic online advertising so far, consumer privacy concerns and new regulations are forcing marketers to adapt to a so-called “cookieless” future.
While this will pose challenges, it is neither entirely cookieless (first-party and proprietary cookies will still be available), nor something to fear or avoid. In fact, it creates several new opportunities for transformative change, if B2B marketers make the right choices today.
Summary:
- What are cookies and why are they so important to online advertisers?
- A future without third-party cookies is not a catastrophe. It is an opportunity.
- 5 opportunities a cookieless future creates for B2B brands
- It’s time to seize the opportunities of a cookieless future
What are cookies and why are they so important to online advertisers?
Cookies - both first- and third-party - are small bits of code placed on websites for a variety of uses, including personalizing user experience and aiding customer convenience, or tracking individual user data such as browsing preferences, online behavior like clicks, downloads, search, purchases, demographics etc. for more targeted advertising.
First-party cookies are placed on sites with user opt-in, and help the site owner offer more relevant content and smoother user experiences by remembering visitor preferences. Just like your favorite Barista.
Third-party cookies, on the other hand, are placed on the site by third-parties, usually ad-networks, who sell access to these audiences to advertisers so they can run more targeted digital advertising campaigns.
While responsible websites increasingly seek audience consent even for third-party cookies, users may still not know exactly how, where or by whom their data will be used when they opt-in.
For example, users may opt-in to all cookies on a news site hoping for a better user experience, but may end up being followed around the internet by a barrage of retargeting ads based on their clicks and searches. And while the ads may or may not be relevant, the consumer may feel like it’s an invasion of their privacy or a misuse of their trust, since they don’t always read the fine-print while opting-in.
That is why, in acknowledgement of the audience’s right to data privacy, all major browsers: Safari, Firefox, and Chrome, have changed their policies and will no longer support the placement of third-party cookies on websites. This is being referred to as the end of third-party cookies.
- Lower ad relevance and ROI on ad spend due to lack of user data-based targeting
- Slimmer pipelines, potentially lower conversion rates and higher costs of acquisition due to shrinking audience scale and reach
- Lower ad campaigns effectiveness without cross-site audience targeting
- More dependence on powerful walled gardens for smaller advertisers and publishers
On the other hand, the end of third-party cookies also holds the promise of transformative change which can be good for all stakeholders - audiences, publishers, and marketers.
- Audiences will have far more choice and control in how their data is collected and used
- Publishers will have the chance to monetize genuine audience engagement at a premium
- B2B brands will have the opportunity to harness the benefits of first-party data ownership and create sustainable differentiators around customer experience (CX) and trust.
A future without third-party cookies is not a catastrophe. It is an opportunity.
Progressive B2B marketers don’t see this development in isolation, but in conjunction with other changes that impact how they do business. Primarily, data privacy laws like the California Consumer Privacy Act (CCPA) and the General Data Protection Regulation (GDPR); and evolving buyer behavior like:
- The shift to digital buying journeys and mobile devices
- Increasing use of ad blockers, demand for relevant and contextual communication
- An expectation of seamless brand experiences across channels, devices and geographies
- A renewed focus on brand trust and credibility
In a business environment where disruption is the new normal, they realize that this is not the time for panic or short-term fixes.
Instead, they see these cumulative changes as an opportunity to create long-term competitive advantage. This means going beyond survival tactics, and making strategic choices to harness the opportunities and create a thriving, future-proof marketing organization. Here’s how.
5 opportunities a cookieless future creates for B2B brand
#1 Own audience relationships with zero- and first-party data
While the end of third-party cookies will make audience targeting for online advertising more challenging, the alternative is equally powerful. Their end actually creates opportunities for brands to minimize dependence on third-parties and truly own their first-party audience relationships at a much deeper level.
First- and zero-party data strategies, which encompass all forms of marketing based on consented, voluntarily provided customer data, are the key to increase content and campaign relevance, reduce opt-out, drive deeper engagement and ultimately elevate revenue.
By choosing a first-party data approach, brands can take the first vital step to build an exclusive, direct and long-term relationship with their audiences and customers.
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#2 Create content experiences, not clickbait
Doubling down on direct digital engagement channels like email, social media, events, and community marketing is a golden opportunity to create a strong, engaged audience with high-value content experiences.
Informing, educating and enabling them - rather than pushing ads - helps them make more informed decisions, and creates strong brand preference even before salespeople intervene.
Another emerging tactic is contextual advertising: placing ads next to content about the same theme to improve message relevance and timeliness. Versions such as native ads, advertorial content and keyword targeting are all privacy-friendly ways to drive brand awareness and association when the user is already immersed in the topic.
The intention is to engage prospects and customers via a value-led relationship, at each stage of their buying journey.
#3 Build intent data ecosystems for stronger pipelines
For B2B marketers, a strong pipeline is critical to conversions and revenue. While this pipeline has long been fed leads based on third-party cookie data, this is an opportunity to reframe what a healthy lead pipeline looks like for the business.
Instead of a high volume of low-quality leads, brands can build a strong intent-data ecosystem to generate high-quality Marketing Qualified Leads (MQLs) which convert faster, bigger and for longer.
Intent data is a set of behavioral signals that indicate a brand is in-market for a particular solution. It layers first-party data from credible sources like brand, publisher and partner digital properties with compliant third-party data such as IP addresses, device IDs or location, which don’t need third-party cookies.
Emerging options like cohort-based targeting, differential privacy and universal IDs which leverage group-level anonymization will help retain the scale of third-party data, without the risks of using personally identifiable information (PII) and other sensitive data.
#4 Improve ad efficiency, effectiveness and safety
There is a belief that ad personalization depends on third-party cookies. The truth is that while advertising at scale depends on third-party cookies, there is no guarantee that more targeting to reach ‘inferred audiences’ drives better business outcomes. In fact, we’ve known for a while that third-party cookies don’t provide the most accurate data - cookies expire, people change devices or set-up firewalls, multiple users use the same device, and preferences change.
Since many brands struggle to balance the risks that come with programmatic digital advertising at scale, the phasing-out of third-party cookies is an opportunity to address the three challenges of programmatic advertising: ad fraud, ad efficiency, and ad effectiveness.
B2B advertisers can choose focused reach and behavioral targeting with credible publishers who have built genuinely engaged human audiences. This will reduce ad fraud, drive digital advertising effectiveness, and ensure brand safety.
The resulting reduction in over-targeting (paying for too many parameters), wasteful retargeting, and programmatic bidding across innumerable unknown sites (often to non-human audiences) would automatically lead to better online advertising efficiencies.
The dollars saved could be invested in future-focused technologies that help build a sustainable first-party data foundation, audience trust and regulatory compliance.
#5 Invest in future-focused technology for people-first marketing
Survey after survey proves that brand trust is paramount for customers today. 85% of consumers also feel companies should use only first-party data to run advertising and marketing campaigns.
The time - and opportunity - to invest in future-proof data collection, validation, management and activation technologies is now. What data a brand collects, how and why they collect it, and what they are able to do with it, will be a distinct - and sustainable - competitive advantage.
That is why Consent Management Platforms (CMP) and Preference Management Platforms (PMP) are fast turning into must-have elements of customer-obsessed martech stacks. They can help turn consent, privacy and compliance into delightful customer experiences and stand-out business results.
CMPs not only ensure world-class compliance, by informing users on the usage of their personal data, they can also help you drive-up opt-ins and consent rates without compromising on transparency, and analyze consent data to create a multitude of new business opportunities.
PMPs collect, store and synchronize powerful zero-party data about what consumers want at each stage of their lifecycle, and help use the insights to create stand-out customer experiences.
These powerful insights, combined with intelligent data management and activation capabilities enabled by Customer Data Platforms (CDP), can enable unmatched people-based marketing.
It’s time to seize the opportunities of a cookieless future
The fear-filled narrative about the end of third-party cookies is fast turning into one of potential gains for brands serious about building authentic, trust-led audience relationships. By building user experiences based on peoples’ actual preferences, they are setting themselves up for success.
How brands respond today by seizing these opportunities will define their fate in an unpredictable future. Perhaps that is why 88% of marketers say collecting first-party data is a priority for them in 2021, and 90% of marketers plan to capture zero-party data within a year.
The challenge for marketers in a post-cookie world is to find the sweet spot between reach, audience quality, engagement, relevance, privacy, and compliance. The key is not more audience or data, but the right data about the right audiences.
To get there, brands should stop worrying about a cookieless future, and invest their time and resources into building a marketing strategy that prioritizes people, privacy and preference.
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