News | Aug 18, 2021
Alex Malloy: Employee Spotlight
Social media goes beyond the algorithm these days, and social media community manager Alex Malloy is here to help clients break it down.
Why has data privacy remained the hottest topic in digital marketing over the past 18 months? And why is the third party cookie on the chopping block? Well, for one, according to Pew Research, 79% of consumers feel concerned about how companies are using the data they collect about them.
And this isn’t news to most of us marketers. We’ve known for years that consumers, once made aware, do not generally approve of the tracking advertisers use to target them. They’ve called data collection practices into question, and now it’s our job, as marketing professionals who target them, to listen to their concerns.
As defined by W3C (World Wide Web Consortium), a cookie is data, stored in small text files on your browser, invented to solve the problem of ‘how to remember information about a user’. The goal of the cookie was to help advertisers increase relevance and thereby conversion/transaction. But the cookie ecosystem was built on the premise of non-disclosure to the consumer and allowed the buying and selling of their information without their knowledge or consent.
Today, advertisers are using cookies to track people in a couple of different ways online. They use first party cookies and third party cookies. Let’s better understand the difference between First Party and Third Party Cookies to explain how they are used to track users.
When a user visits a business' website, first party cookies are placed in the user's browser. The first party cookie identifies the user as someone who has visited the website, shared their information with the business, and given explicit permission to the business to continue the relationship.
Third party cookies are data that is saved in your browser that tells other businesses, often advertiser platforms, information about you so they can target ads. So when a customer visits a site, the browser places a cookie, a piece of data, in the browser so that the ad or site can identify you as you travel around the Internet.
This all made sense 20 years ago, but the challenge with the third party cookie solution is it’s all behind the scenes. Advertising platforms are building robust profiles of customers who never really agreed to share their data with them in the first place. Ultimately this creates the uneasiness that consumers have, because they don’t know how their information is being collected, or what data they are sharing.
To combat this, governments have created regulations like the GDPR & CCPA to protect citizens from businesses collecting their information without their knowledge. These regulations are designed to put the customer in control of their data, requiring businesses to explain their data practices and allow customers to remove their data from the business if they want to.
The challenge with these regulations is the amount of customer data already collected and the difficulty in removing it. This situation has prompted businesses and platforms to consider a better experience that allows customers to opt-in to targeted ads.
As a result of these regulations, we are approaching one of the biggest shifts in the way digital advertising works since its inception. And it’s all because of what’s changing in the world of identity. Driven by consumer privacy concerns and accelerated by technology changes, identifiers like third party cookies and mobile device IDs are endangered species. To continue to run data-informed digital advertising campaigns, a new approach will be needed… soon.
Opt-in data on individuals, encrypted for security. Some of this data is made available via open industry initiatives (such as UID 2.0), some of it sits behind walled gardens & inside data clean rooms. It is expensive and limited in scale. But, it is highly insightful and provides a real-time window into consumer behavior. It’s the world’s most powerful marketing panel.
Individual data that is secure because it is grouped into cohorts. These groups of users might all be consuming media in the same context right now, or might all have displayed similar behaviors in the past. Data tied to cohorts is truly anonymous and as a result can be executed at scale, to reach any user in the world without an ad blocker. In addition to contextual ads and publisher-curated segments, edge computing & Google Chrome’s Privacy Sandbox promise exciting new ways of executing cohort-based targeting. To win, marketers must be able to extract maximum intelligence from the authenticated world, and then activate this at scale through anonymous targeting, to their entire addressable audience. This connected approach is the only path to deliver the high reach, high relevance, high ROI campaigns of the future.
There are currently 27 different alternatives/solutions to authenticated IDs. There is not a one size fits all cookieless solution.
. Sources/Partners: Centro, MiQ, Pew Research, W3C