We’ve all be there – a website opens, we’re ready to browse and we’re hit with a pop-up.
It’s not an advert, thankfully, but it’s not a simple “click ‘X’ to close.” That option doesn’t exist.
It’s a question about cookies (and not the edible-type, sadly). You’re being asked to allow a brand or company to use cookies to track you. Not physically, but they’re asking to monitor things like how long you spend on the site, the links you click and the preferences or settings you choose.
For a brand, it’s gold-dust. But for the increasingly digitally savvy consumer, it’s a concern. Do you know how much your data is worth? Do you know how it will be used? What exactly do you get in return?
These are just some of the issues we’ll explore in this blog as we dive into why consumers’ attitudes towards data privacy are changing – and how big-name brands are responding.
What is a cookie?
It’s safe to assume many of you reading this will be familiar with cookies, but let’s start with a simple definition.
A cookie is a small block of data that’s placed on your device by your web browser. This happens whenever you visit a website. First-party cookies are added by the website itself. For example, after you log in to your Amazon account, it places a cookie on your device that saves you from having to sign-in every time you visit a different web page.
A third-party cookie, as the name suggests, is added by someone other than the website you’re visiting. Take this as an example – you’re reading about your favorite soccer team on a national sports website and the first page contains an ad from a well-known kit supplier, which sends a cookie to your device with information on where you viewed it. Later, you’re reading a weather forecast online and see another ad from that same kit supplier. This means you will have received two cookies from that company, who will now know what sites you were visiting when you saw their ad.
Why does it matter?
From your point of view, it may not matter. Not at least in that moment of reading about your favorite soccer team or checking the weather. Clearly, your interests lie elsewhere.
But for the kit supplier, those cookies are vital. It allows them to build up a picture of you – the consumers.
t’s worth pointing out, but enough to start building a personalized, digital marketing strategy that will deliver targeted ads and content straight to your device.
The end of the third-party
The big issue facing brands and marketers right now is the phasing out of third-party cookies.
That’s right. It’s already happened on Firefox and Safari and it’s going to happen on Google, too, which Chrome set to ditch the tracking technology by the end of 2024 (the tech giant had previously committed to doing this by 2023 but pushed it back by a year to allow for further testing).
Despite that delay, the death of the cookie should still be considered an inevitability. This is, in part, in response to consumers who have grown more aware of the capture and use of their personal data.
But it’s also in response to governments around the world who are finally taking a stance on data privacy. For example, in October 2019, Europe’s highest court ruled users in the EU must actively consent to all analytics cookies when they log onto a website.
The ruling – known as GDPR – meant websites can no longer rely on implicit opt-in. This has also been reflected in similar legislation introduced in Brazil (LGPD), California (CCPA) and New Zealand (Privacy Act).
But let’s be very clear – while cookies are ending, tracking isn’t. And nor is personalized content.
How are brands responding?
The onus is now firmly on brands and apps to collaborate with their end-users more intimately, perhaps in a way they haven’t necessarily had to before. They need to create more human, more meaningful online experiences that are built on principles of consent, control, and transparency.
And that key word that comes up time and time again: Trust.
For many brands, there are two key questions that need to be considered here – why would my customers agree to give me their data? And what are they getting in return?
For senior marketing executives discussing this on a recent Meet the Boss roundtable, it’s all about creating a “value exchange.”
“A loyalty programme, for example, or better on-site recommendations,” one executive shared.
“You need to really stop and think about why the consumer would want to give me this information.”
Being upfront and honest with the customer was advised – particularly when it comes to why you want to use their data.
“Asking the customer, the right question at the right time is not friction,” the Chief Marketing Officer of a digital verification platform told peers at the event.
“It comes back to context. Ultimately, you can provide them with better products by asking the right questions.”
“And people will put up with it. Why? Because they get a better product.”
Of course, personalization only works if brands are able to deliver what it is they’re offering to the consumer. This was mentioned by the Head of Retail Product Marketing at a global telecommunications company on another recent Meet the Boss roundtable.
He warned failing to deliver on an offer to a customer is one of the main thing’s retailers “get wrong” when it comes to personalization.
“With supply chain issues going on, you’re giving all these offers on certain products and if you can’t deliver on those offers, it can have a really long-term impact.”
Getting back to the data
- Deloitte’s LLP survey found 80% of consumers are more likely to purchase from companies that they believe protect their personal information.
- In addition, 79% of these buyers would be willing to share their data if brands made it clear it would benefit them.
- A recent survey from McKinsey found that 90% of customers have concerns about online privacy, with half limiting their online usage because of these worries.
- But on the other hand 64% of digital marketers say these concerns won’t stop them from gathering all the data they need, in order to keep their ads as personalized as possible.
Let’s get back to the data, shall we? That’s what enables personalization, underpins targeted ads, and fuels marketing strategies.
Without it, none of this is possible. And that’s true of any brand or company, irrespective of the industry they’re in.
“If I have customers who decline cookies, then I won’t have enough data points – and this is the challenge,” a Director at a leading European bank told industry figures at a Meet the Boss roundtable on data privacy.
“On the one hand, looking at the banking sector, I’m not able to use any statistical tools without your consent…I can do many things but I need an analytics opt-in. For example, I can make emails more relevant if I know you clicked on a particular link.”
The thing is, it’s not just consumers that are concerned about their data. Industry professionals are, too.
During another recent Meet the Boss roundtable event, a senior leader at a British computer firm admitted he routinely declines cookies – despite relying on his customers to do so.
“We see it in IT all of the time,” he explained. “There is still this reluctance to get data from the device. I, as a user of digital services, refuse to validate cookies.”
“I click on the three dots that I need to. I don’t know how they’re going to use it, but meanwhile, I wear my health watch and I would like that data to be available to a hospital when I go there…I have a choice of what data I give out. Ethically, nobody really knows where the data goes and I think there’s a lot of fear around that.”
What’s next, then?
That’s the question facing advertisers, many of whom are wondering what the future of digital marketing will look like.
In short, the removal of third-party cookies will make it harder for advertisers to track the web activity of potential consumers.
With no third-party cookies to rely on, advertisers will have to use first-party cookies for their targeting information. That shift will no doubt favour large corporations that not only have the ability to harvest that type of data, but also the resource to turn it into profit.
Smaller companies that lack first-party data will initially struggle to target and remarket to shoppers, making it harder to advertise.
But there are ways of capturing it. Newsletters, for example, are a great way of connecting with your customers and collecting their data in a way that doesn’t feel intrusive. This applies to any high-quality content users can interact with, while providing you with valuable data on their preferences, choices, and interests.
Fundamentally, brands and advertisers need to start prioritizing and investing in digital marketing strategies that allow them to take control of their data and leverage it for their own means. And not because it’s enforced by some browser or law, but because its what customers expect.
How are you preparing for a cookie-less world? GDS presenters Alex Wood and Julia Belle discuss this on the latest Strategy for Breakfast podcast. Click here to listen.
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