Guest Post by Ron Jacobs, CEO Jacobs & Clevenger (ronjacobs@jacobsclevenger.com)
Ron Jacobs is an industry veteran with insights useful to the MindFire community. As CEO of Jacobs & Clevenger, a data-driven marketing and creative agency in Chicago, IL, and co-author of Successful Direct Marketing Methods, 8th Edition, we asked him to provide a guest post to share his view on third-party cookies and their impact on the marketing community at large. Join me in welcoming him — and let’s talk in the comments!
Last month, I participated in a virtual conference sponsored by the Interactive Advertising Bureau (the IAB.) This annual conference included speakers and participants from large advertisers, digital ad agencies and the digital ad media. One topic that was mentioned time and again during the conference was the end of third-party cookies. I was surprised by the depth of the digital industries’ collective hand-wringing about this change.
In research released by the IAB at that conference, they reported that most brand advertisers were unprepared for the loss of third-party cookies and identifiers. Brand advertisers are most likely to delegate the heavy lifting of data preparedness to their agencies or ad tech providers (Interactive Advertising Bureau (IAB) State of Data 2021 Report).
Google let marketers know back in January of 2020, that by 2022 they would phase out the use of third-party cookies in the Chrome browser. Google was late to the party. Safari and Foxfire stopped allowing tracking using third-party cookies a few years ago. Google recently announced that they were starting the phase-out of third-party cookies in April 2021. This has become a very top-of-mind and urgent issue within the digital advertising technology space.
Cookies are small snippets of text that are added to a browser when users visit a website. Third-party cookies leave crumbs across the internet so some of a user’s personal information (PII), as well as their browsing behavior and website visits, can be tracked long after the user has left the website that added the cookie.
In the current climate of privacy concerns, it seems time that third-party cookies end. Given that marketers are people too, this should be something that all of us celebrate…Until we realize how it changes life for digital-only marketers. Digital advertising counts on tracking activity to help reach prospects and customers at a point when those users are ready to convert or make a purchase.
The end of third-party cookies, however, is not the end of first-party cookies. First-party cookies store usernames, passwords and other information that makes it possible for users to be recognized when they return to a website that they have previously visited. First-party cookies do not leave crumbs of data that can be used to follow user’s activities to other websites. First-party cookies make life tolerable for those who cannot remember every password for every website they visit frequently. First-party cookies are still available for use on all major browsers and most websites.
You may have already heard about the end of third-party cookies. But you may not have realized the significance to digital-first marketers. For those that rely on digital advertising, it is a sea change not to be able to easily follow their users across the expanse of the digital realm. Why? One reason is that many digital marketers are much less adept at collecting and using first-party data than direct mailers, response marketers and direct-to-consumer marketers.
Listening to digital marketers, one could think that first-party data was something just invented. Digital marketers are being told that it requires huge investments in both time and dollars to create customer data platforms, data lakes or big data technology to collect, clean, analyze and apply first-party data. There is a lot of misinformation being shared among digital advertisers about first-party data.
It is true that digital advertisers will have to recalibrate their solutions to targeting, measurement and optimization. That is something that many marketers like us, who are already using first-party data, know how to do.
We use first-party data for acquisition, retention, engagement, win-back and personalization. Today, personalization is not about personalizing names and addresses. It is about using behavioral data, intent data, next best action and a host of subtle observational data put at our fingertips by first-party data. It is about making marketing more relevant to consumers. While consumers expect and are delighted by relevancy, many worry about marketers’ use of their personal information (PII). While digital marketers have their own special brand of data myopia, so do those of us who have been using first-party data since the 20th century. Some things have changed.
Consumer’s concern regarding privacy has been expressed and heard by regulators. Regulators have devised a myriad of privacy laws such as the European Union’s General Data Protection Regulation (GDPR), the U.K.’s Privacy and Electronic Communication Regulations or California’s Consumer Privacy Act (CCPA). All of these laws mandate the need for user consent (opt-in) for websites to use cookies. These regulations allow marketers to continue to reach prospects and customers using the first-party data that they captured as part of doing business, as long as consumers are given the option to opt-out of having their personal information used commercially.
It is likely that if you are reading this blog post, you may already know how to collect and apply first-party data. You may have been frustrated speaking to digital marketers and partners within your own firms about using first-party data. What seems to many digital marketers as a crisis, appears to be a great opportunity for us to reach out and help digital marketers and advertisers understand how to use and apply the first-party data that many of them may have already collected— but have never actually applied in the ways that we do.
What seems to many digital marketers as crisis, seems to be a great opportunity for us to reach out and help digital marketers, brand marketers and advertisers understand how to use and apply the first-party data that many of them may already have already collected, but have never applied it in the ways that we do. It is likely that digital advertisers will learn that first party, data-driven marketing programs will have significantly better results than the passive, third-party cookies cookie programs that they are losing.
Here are things that digital marketers can do today:
- Coordinate within firms among decision makers for digital advertising, data, analytics and direct marketing, to learn how to strengthen cross-channel programs
- Test and demonstrate how online and offline channels can work together, for example using calls-to-action within direct mail to drive digital conversions, leads and response
- Combine technologies like PURLs, QR codes, video and other digital tools with direct mail
- Use first-party data to drive hyper-personalized variable data printing and direct mail, making it a powerful digital marketing tool
- Run opti-channel campaigns, combining and unifying email, Facebook, Instagram, Pinterest and other digital channels with direct mail in ways that marketers have not done before
Companies like MindFire and Jacobs & Clevenger have seen these possibilities. It is great to have so many others that we may be able to share this with.
The end of third-party cookies end is an opportunity that all of us can be excited about. It comes just at the end of the long pandemic, and as the economy seems to be turning a corner. This could help propel 2021 into a year of new thinking and great innovation.
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Ron Jacobs is CEO of Jacobs & Clevenger, a data-driven marketing and creative agency in Chicago, IL and co-author with the late Bob Stone, of Successful Direct Marketing Methods, 8th Edition.
Thank you Ron, for sharing your valuable insights with our community!!