What Should Digital Marketers Do After the Cookie Crumbles?

Ever since the first mainstream mentions in the mid-90s, cookies have been the backbone of digital marketing. Their ability to follow people around the Internet and vacuum up data based on their browsing history and behavior created a virtual goldmine for marketers.

By having an up-close view of consumers’ online habits, companies could make a lot of assumptions about their likes and future purchasing decisions. So when Google first announced it was joining Apple and other technology leaders in killing the third-party cookie, the digital marketing industry let out a collective sigh.

However, after Google announced it was delaying the death of the cookie until 2023, many took it as a sign that the cookie might still live on forever. After all, more than 80% of Alphabet’s revenue comes from Google ads, and removing the use of third-party cookies would complicate marketing for its customers. So why would they put all that revenue at risk?

Consumers Want More Privacy

According to Beeby Clark+Meyler (BCM) co-founder and Principal Michael Clark, the answer is simple: they really didn’t have a choice.

“Consumer privacy concerns have snowballed into the regulatory environment in a major way,” he said. “Companies are being forced to rework the ways in which they make use of consumer data. And as a result, the ability for marketers to use third-party data in a meaningful way is slowly coming to an end.”

Founded by Modem Media alums Tom Beeby, Michael Clark and Stuart Meyler, BCM is an integrated performance marketing agency that has made a name for itself in the travel & tourism, consumer packaged goods (CPG), education, B2B, and financial services industries. The boutique agency also has a unique ability when it comes to helping large enterprises get the most out of marketing automation systems, such as Salesforce Marketing Cloud.

A Lot of Marketers Aren’t Prepared  

Even though they haven’t disappeared completely, the shelf life of the cookie is getting shorter all of the time. Regulations like CCPA, GDPR and others have reduced the cookie’s lifespan from years to months, and now just hours in many cases. Time is running out and marketers need to start figuring out alternatives.

The 2022 Adobe Digital Trends survey found 38% of practitioners are still not prepared for a cookieless future. However, a report by AdAge paints an even bleaker picture. The report states that, “While a little more than half of marketers reported having a high sense of confidence in their company to navigate the future of privacy and identity, 70% say they do not have the resources necessary to move through the change with success.”

“A lot of agencies are taking a wait-and-see approach to what comes next,” said Clark. “By doing that, they risk losing any forward momentum they’ve been able to build for their clients. They are giving up a competitive advantage and smart companies are going to capitalize on that by being ahead of the game.”

What Should Marketers Do Now?  

Any marketer worth their salt knows that it’s better to focus on solutions to problems rather than the problems themselves. That’s what they get paid for. And according to Clark, the answer lies within data modeling and second-party data partnerships.

“First-party customer data is the most trustworthy and relevant source of information when it comes to discovering your target audience, their purchasing habits, and the best ways of reaching them,” he said. “But a lot of companies haven’t been great at collecting first-party customer data. And that’s where second-party data and modeling can save the day.”

Others within the digital marketing world seem to support BCM’s views on second-party data’s rise in prominence. In a 2021 report, Merkle revealed 74% of businesses view second-party partnerships as a priority. But how does it all work?

How Marketers Can Leverage Second-Party Data  

As Clark explained it, companies will have to forge creative data partnerships in order to leverage second-party data. Unlike third-party data, second-party data isn’t sold as readily on the open market. Rather, it’s a company’s first-party data that it can safely share with its business partners. In a sense, it’s data that can be borrowed for a specific purpose and for a limited period of time.

A good example of how a second-party data partnership might work is if an airline partnered with a hotel chain to build a better customer profile on people who travel for business. In return for access to the hotel chain’s data, the airline might share its data or execute some form of joint marketing on behalf of the hotel chain.

In another example, the insurance company Progressive partnered with Zubie, a connected car service, to give Zubie customers an opportunity to earn discounts on their auto insurance by sharing their driver data with Progressive.

“Although company-to-company data relationships enable the exchange of valuable customer information, they require time and other resources to uncover, negotiate, set up, and administer,” added Clark. “And that’s the role agencies must be able to play. However, if they don’t already have those abilities, they are already far behind those that do.”

Experienced Marketing Agencies Will Fill the Void

As the digital marketing world continues to evolve, those with the skills and experience will continue to lead the pack in the new privacy-first era. BCM, which formed in January of 2005, emerged from the digital industry’s early M&A activity between digital media pioneers Modem Media and Digitas.

And even back then, they knew the time had come for a more performance-driven, integrated, agile, and strategic agency approach. Seventeen years later, they lead a new revolution in how marketing agencies should operate.

“Rapid, but purposeful reinvention is a fundamental requirement for success in digital media,” added Clark. “Many holding company agencies and their clients have gotten caught under the weight of proprietary agency technology, which has limited their ability to quickly advance their clients’ interests in this new, privacy-first reality. I would suggest leveraging agencies that build client-side capabilities in addition to providing fee-based services.”