Filling the Third-Party Cookie Void with First-Party Data

The impending sunset of third-party cookies means that brands will have to find other ways to manage ad targeting and measurement. Following up on our recent look at the cookie context and how this shift will affect the people who rely on them, let’s turn to the ways brands can adjust and thrive in a post-third-party cookie world.

The gap that will be left by third-party cookies has sparked a race to provide an alternative method for targeting and measurement. Many established players in the ad tech and marketing ecosystem have thrown their hats in the ring with a range of offerings, including LiveRamp’s Authenticated Traffic Solution (ATS), The Trade Desk’s open-source ID framework, Dentsu/Merkle’s Merkury ID, and Publicis/Epsilon’s CORE IDs. These solutions try to track based on a real identity (like a person’s email, hashed for privacy) instead of an anonymous cookie tied to the browser (and therefore not tied to an actual person). Google’s Privacy Sandbox is taking a different tack, trying to be more privacy-friendly by not tracking back to any individual, aiming instead for group-level targeting by segmenting browsers based on browsing activity.

Each of these has its strengths and weaknesses, but it’s not clear that any will rise to the level of a standard approach that wins universal adoption across the industry. The ad tech players are trying to establish a solution so that there is an alternative to Google, Facebook, and other large walled gardens, and it remains to be seen how it will shake out.

Meanwhile, smart brands aren’t waiting around hoping that one of the new methods will emerge as the industry standard. Instead, they’re preparing for a future where targeting, personalization, and measurement are based on first-party identity data that they collect directly from users with their consent.

Quality first-party data can become the basis of a strategy that enhances the experience on your owned channels and improves efficiency and accuracy when working on other channels. Here are four key themes to guide this kind of approach:

First-party Reigns

Your first-party data will inform everything you do, from personalization and retention on your own channels to finding audiences for acquisition on paid and partner channels, including lookalike and contextual marketing. Making sure your first-party data is robust, reliable, and accessible is the key to unlocking the rest of your customer strategy. Since you control the customer experience, you can collect the best data possible instead of relying on third-parties.

Quality Matters

High quality PII (personally identifiable information) continues to be important — data like current and former names, email, home address, phone number, birthdate, etc. The more PII you have and the more accurate it is, the better you’ll be able to engage with the right person on your owned channels, the higher the match rate when working with targeters and ad networks, and the more granular you can get with lookalike audiences. This will be true no matter how digital advertising reshapes itself in the wake of the third-party cookie.

Privacy-compliant Data Sharing and Collaboration

Developing and deepening direct relationships with advertising and marketing partners, including other complementary brands, helps extend reach, targetability, and measurement, expanding options on channels outside your own. Engaging with partners this way is another instance where good quality PII will improve match rates. Brands can make the most of compliant sharing with cleanroom technology to provide secure environments for matching first-party data sets without exposing that data to third parties, as well as a privacy-focused Customer 360 database that can manage and track the rights of customer data that they share with and receive from partners.

More Experimentation

By developing the process and infrastructure to test and measure new campaigns on both existing and new channels, brands will be able to fill in gaps from the departure of the third-party cookie and strengthen themselves for the future. New channels to experiment with include connected TV, growing platforms like TikTok, and contextual targeting. Many other new channels and potential partners will of course continue to emerge — the key is having an enduring test-and-learn infrastructure to expand into new areas of opportunity and be prepared for unexpected twists and turns.

Building a winning first-party data foundation

All of this points to the need to establish a firm and durable foundation for first-party data as the new linchpin for targeted marketing and personalized commerce.

Making the transition away from relying on third-party cookies requires the right technology for gathering, managing, enriching and deploying first-party identity data. Here are some suggestions for how to build toward that future:

Establish and maintain direct relationships with consumers: The most robust first-party data assets and the most accurate identity graphs are based on a unique and ongoing relationship with real people. This means crafting the best customer experience possible, so that people will feel good about sharing their information with you.
Centralize PII Data Into a First-Party ID Graph: Collecting permissioned data is only the first step; the real power comes when brands can build a first-party ID graph that synthesizes the best available PII from across all consumer touchpoints. This requires a Customer Data Platform (CDP) that can handle messy and multi-sourced PII at a massive scale.
Build a comprehensive and rich Customer 360 database: With the data in one place and identities resolved, brands should develop and maintain persistent customer profiles that can serve as the basis for analytics and personalization for teams across the operation.

There’s no quick fix to replace the functionality of the third-party cookie, but a thoroughgoing strategy based on solid first-party data will help insulate brands from the ad ecosystem’s post-cookie convulsions and help them go forth boldly into a third-party-cookieless future.