Ready to Build Personalized Experiences in a Cookie-Less World?

Are you curious about the cookie-less revolution and how it will impact your customer experience and personalization in digital marketing in general? Here we give a quick overview of the topic and some pointers to solutions forward as we all know the importance of personalization in marketing.

The end of Cookies, disruptive times for MarTech

You may, or not, be aware: cookies are on their way out, and it is shaking the world of digital marketing like rarely before. With the end of cookies, the domain of user targeting, digital advertising and personalization is going through a disruptive and transformative period, hopefully for the better.

The reason for this change is all about user privacy and user experience. The use of cookies in advertising has demonstrated its shortcomings with privacy and user experience.

In a GDPR and CCPA era and when customer experience is becoming the number one priority for many, the industry engaged in this transformation. In my opinion, it is a very welcome move – in principle at least, as I'm as much concerned about my personal data as about my user experience, and I will be delighted if I could stop being spammed by not-so-relevant targeted ads.

However, it has to be done wisely and respectfully of the whole MarTech ecosystem. We should remember that this change will probably not come without impact or collateral damage on the current business ecosystem.

Today almost 80% of the Advertising spend is done through programmatic advertising and third party cookies. McKinsey estimates that in the US only, it's $10 billion of spend (and so of revenue) which is at risk. I’d also like to point out that this should not become yet another  opportunity for the digital giants (Google, Apple, Amazon, Facebook et al)  to widen their grasp on the market.

The end of Cookies, really?

Let's provide some clarification which not everybody might know about:

First, not all cookies are going away; only third-party cookies are. They will be kicked out forever by being removed and blocked from Web Browsers. Apple Safari and Mozilla Firefox have already implemented changes blocking them. Google is about to embrace the same inevitable change, even though it’s taken its time, as it promised to keep their support until 2023.

So it's essential to make it clear for those relatively new to the subject, not to make the forthcoming change bigger than it actually is (which is huge enough). While Third-party cookies will go, first-party cookies will stay in our lives and will remain an essential component for building web experiences based on “owned” data. They are, and will remain, a legit and viable option to target content .

And for those uncertain of the difference between first-party and third-party, here’s a quick explanation:

First-party cookies allow the building of personalized experiences on websites using information regarding the visitor: how this visitor used the website, and which information the visitor consented to provide to the website. As long as the website is clear in terms of customer data privacy and asks for consent, there is nothing particularly wrong with the use of first-party cookies.

Third-party cookies are what programmatic advertising solutions typically rely on to target their advertisements to visitors. They do this by accessing personal data about this visitor on a third-party website (or app) in the so called “third-party cookie”. This data is collected by many intermediaries, over time, from many different sources, websites and online channels. These cookies allow publishers and other media outlets to "sell" personal data to advertisers with the promise of highly targeted ad content and further higher ad conversion.

On this point, the good news for Ibexa customers  is that our personalization and targeting capabilities solely rely on first-party data. Since day one, when we started to develop our personalization engine, we excluded the advertising use case. Consequently, we excluded the use of third-party cookies in the core of our solution, being conscious of the risk it might put on privacy.

In summary, cookies have not entirely disappeard; however, from now on, it will be only homemade cookies. This sounds good to me, don't we all dream of a world where we only eat homemade ones?

The Cookie is dead, long live the Cookie!

So third-party cookies are out and first-party cookies will take on greater importance and wider role in digital marketing – in the building of targeted and personalized experiences.

Cookie management and other consent management tools will equally continue to grow and improve. Marketers will probably partly shift their focus on "existing customers", and re-prioritize their budgets on loyalty, retention, and upsell more than traffic acquisition. This is because first-party cookies are all about existing visitors and not about the acquisition of new visitors.

But it would be a mistake to think that first-party data is only about retention. As traffic acquisition is such an essential part of digital marketing, it certainly can't go away. Digital advertising giants and niche players are all investing significant effort in imagining solutions where there's a future for data-driven advertising solutions in the post-third-party cookie world.

It is likely mean the return of contextual advertising. Contextual advertising is not based on user data and behaviors but on the content being consumed; and so doesn't suffer from the death of Third-partie cookies. Content and content marketing will never be as crucial in the marketing mix as ever before!

It will also mean the arrival of new options such as Data Clean Rooms and wall gardens. These are new solutions where you can use your first-party "own" customer data to identify and target new audiences without ever accessing their personal data and without going against the new privacy expectations and regulations, hence ensuring your customers are safe.

As Google explains so clearly (too clearly to be true?), this means that first-party data might be used as much for acquisition as for retention by leveraging the concept of Data Clean Room, with very similar results. This might be true for actors of the size of Google, but is probably not for smaller advertising actors.

It's all about knowing your customer

More than ever, the future of marketing and customer experience will be about knowing your customer. We at Ibexa are very much aware of that. That's why we pay so much importance to areas such as interoperability, data integration and customer data in our product vision and roadmap.

Building unified customer user profiles, integrated and shared across your DXP, CDP, and many other business systems (such as Marketing Automation, CRM, ERP) has never been as crucial as today.

When it comes to B2B digital marketing, it is even more powerful and complex. Between what's personal and what data is owned by an employer; how to target organizations more than individuals; and how to aggregate signals from users belonging to the same account, things can get complex and the Third Party cookie was surely not the magic ingredient to success.

Feel free to engage with us if you are interested in the topic.

^{Photo credit: https://unsplash.com/photos/Kq1PEA5mzWg by Tijana Drndarski @izgubljenausvemiru}