Privacy is becoming more and more important to consumers. As a result lawmakers are introducing data protection regulations and internet browsers are moving away from the use of third-party cookies.
So what does a cookieless future mean for marketers? And how can they prepare for it? We explore these questions and more below.
What does 'a cookieless world' mean?
Third-party cookies are used to anonymously track a consumer's activity as they browse the web. This allows advertisers to create carefully targeted campaigns and accurately measure the results.
While cookies are incredibly useful for marketers they raise privacy concerns for consumers. For this reason Mozilla's Firefox and Apple's Safari have already blocked the use of third-party cookies. Google is currently phasing them out in its Chrome browser too.
At some point in 2022 Google will officially stop supporting third-party cookies and it doesn't plan to implement any alternative tracking. Instead it intends to focus on privacy-preserving tech. This means the data-driven highly-targeted performance advertising that marketers have used successfully over the past two decades will come to an end.
What does a cookieless future mean for eCommerce?
If you think you can rely on your eCommerce app to track the online activity of shoppers you'd be wrong. Internet service providers are cracking down on these cookies too.
Apple's iOS 14 allowed users to control their data on an app-by-app basis. Then iOS 14.5 took privacy protection a step further by using in-app pop-ups to ask users if they want to be tracked. This 'App Tracking Transparency' feature is making consumers more data-conscious and constrains a company's ability to target and measure their campaigns. While some shoppers may choose to enable cookies eCommerce companies will be left with incomplete data.
Nobody knows precisely what the future holds. But since Mozilla removed third-party cookies back in 2013 tech companies have been paving the way for a cookieless future and empowering the public to protect their data. Going forward privacy and trust must be a priority for eCommerce brands.
When third-party cookies disappear the amount and quality of data available to marketers will drop. This will disrupt the ad targeting attribution and optimisation that many eCommerce brands currently rely on. It's likely to result in an increase in customer acquisition costs and a decline in return on ad spend too.
However brands can adjust to this new reality by tapping into a broader range of data sources and seeking out alternative technologies.
How can marketers thrive in a cookieless world?
So how do eCommerce marketers create effective campaigns without the help of third-party cookies?
To understand consumer behaviour and create personalised campaigns eCommerce brands will need to implement consent-based tracking and transform the way they collect data.
Here are five actions they can take to prepare for the era of cookieless advertising:
1. Leverage first-party data
First-party data is information that you collect in-house through your website app social media or other customer interactions. Because it comes directly from customers this data is highly relevant and reliable.
Most eCommerce marketers will have tons of first-party data on-hand. So in preparation for a cookieless future it's a good idea to review everything available from Google Analytics your CRM your past market research and any other analytics tool you use.
Analyze all the data available and ask how it can be improved. Are your tools tracking the right KPIs? Are there any data sources you aren't analysing? Do you need to introduce new analytics tools? Implementing cookieless tracking through a 'Where to Buy' solution or a clickstream data tool could be particularly enlightening.
Don't hesitate to set up surveys or questionnaires either. Research by Forrester suggests that most consumers are happy to provide personal data in order to receive personalised offers. Many will share product preferences interests hobbies style preferences and demographics for this reason. eCommerce brands that start requesting this information now will be well-positioned to implement cookieless targeting in 2022.
2. Consolidate your data
To get an accurate understanding of customers brands need to merge all their first-party data in an effective way. They also need to use tools that provide contextual data and predictive analytics to extend their cookieless advertising reach beyond their current customer base.
Big brands like Coca-Cola and Mars have already successfully applied unified data to improve their marketing ROI. Coca-Cola and other leading businesses are also calling for the creation of an industry-wide audience ID which companies can link with their first-party data to target relevant consumers.
3. Try contextual advertising
Contextual advertising is a great place to start when introducing cookieless advertising because it allows marketers to reach relevant consumers without needing to collect any personal data whatsoever.
With contextual advertising you can serve ads to consumers based on the web page or content they are currently viewing. For example you could advertise hiking boots on a YouTube video about hiking trails or promote cake tins on a blog post featuring a cheesecake recipe.
Rather than relying on data about past behaviors' this cookieless targeting method uses current consumer behavior's to reach the right audience at the right time. Marketers can easily implement it through platforms like the Google Display Network Amazon DSP or AdRoll.
4. Invest in retail media
If you sell your products on third-party retail sites like Walmart Amazon or eBay you can use their retail media platforms to tap into their extensive first-party data and target highly relevant consumers.
Every marketplace collects valuable data from its shoppers. They often know what products someone has bought viewed or added to their basket. If they run loyalty programmes they probably have in-depth insights into the likes of household size income and in-store purchases too. Recent stats even show that using loyalty card data to target consumers based on their past purchases can boost the ROI of a campaign by 20%. It also suggests that this cookieless targeting method is more effective than contextual or demographic targeting.
Retail media also offers definitive attribution metrics.
5. Upgrade your email marketing efforts
Email marketing has been around for decades and was established long before third-party cookies came on the scene. That's why this technology is ideal for marketers who are now pursuing cookieless advertising.
Email marketing has always been used to nurture audiences understand their behaviour and increase sales. Best of all email lists are based on consent-based opt-ins and most eCommerce brands already have lots of subscribers.
You can segment these lists by the likes of location past purchases order value survey results loyalty and email engagement. Each group can then be targeted with unique content and promotions. eCommerce marketers can even use automated journeys triggered actions and retargeted emails to drive conversions.
Effective email marketing can achieve the same things as third-party cookies so it will be a key channel for eCommerce marketing in the years ahead.
The end of third-party cookies will bring big changes to the world of eCommerce. The initial disappearance of this data will probably send shockwaves through every eCommerce marketing department. But by adjusting campaigns and preparing in advance your online store can continue to grow.
At first you may need to spend more on Google and Facebook to acquire the same number of customers. And you need to be ready to shift spending and increase your media mix to safeguard against losses. However as time goes on you'll be able to build more reliable datasets and better customer relationships.