Third-party cookies were once an integral part of most online marketing campaigns. Browsers like Firefox and Safari already block the small text files that enable very precise targeting and recognition of the same users in a new environment. According to current information from Google, they will follow with Chrome by 2024. However, this is only one of many aspects around the trend toward privacy-safe marketing. What's next?
Marcel Sprecher and Katja Büchi talking about the transformation of digital marketing.
You have to rethink digital marketing, says Marcel Sprecher, Principal Consultant at Webrepublic. He has over ten years of experience, from SEA to programmatic advertising to consulting for clients from a wide range of industries. In an interview with Katja Büchi, Senior Communications Manager, the expert shows how companies can best tackle the issue.
Katja Büchi: The end of third-party cookies has been a topic in the marketing industry for what feels like an eternity. Is there anything left to say about it?
Marcel Sprecher: Absolutely. It is extremely important to keep this discourse going. In the past, most digital marketing in the broadest sense was based on cookie technology, but in the future there will no longer be a "one-size-fits-all" solution. Various players such as Meta or Google are developing new approaches at full speed. This will lead to a fragmentation of the market. To find their way in this fragmented environment, it is essential for marketers to follow the developments and evaluate the right solution for their company in the medium term.
Accordingly, you also talk about it frequently with customers. What question is burning on their minds?
Most are concerned about retargeting and question whether it will still work in the future.
Are these concerns justified?
The fact is that cookie-based retargeting lists are getting smaller and, as a result, cookie-based retargeting is already hardly possible in certain environments. It is important to note, however, that this is not just about the elimination of third-party cookies. This is merely a symptom of the overall trend toward increased data protection. This also includes, for example, the European Data Protection Act (GDPR), Consent Management Platforms, and so on. This development must be viewed and addressed holistically.
Last week, Google pushed back the end of third-party cookie support in the Chrome browser once again. There is now talk of the second half of 2024 - it was originally planned for this year. Is it really coming then?
I think so, but it's not that relevant. One way or another, marketeers need solutions that work without cookies. For one thing, other browsers like Safari or Firefox have had stricter privacy policies for a long time. For another, the entire app environment is not cookie-based anyway. In short: The possibilities to do marketing based on third-party data are getting smaller and smaller - until they disappear completely. The planned discontinuation in Chrome is only one part of the big picture.
OK. So we have to prepare ourselves. Once again, what do companies have to be prepared for when marketing based on third-party cookies is no longer possible?
The specific impact on individual companies varies greatly depending on their set-up and marketing focus. Two examples: An e-commerce provider that relies on accurate tracking data to drive its paid search budget will have to deal with the fact that this data is much less accurate without third-party cookies. A luxury brand that is more traditional and relies mainly on TV and out-of-home will have to deal much less with the cookieless future.
What impact will companies feel if they ignore current developments and do not adapt their marketing?
In the medium term, both campaign performance measurement as well as audience targeting and retargeting will no longer be possible in the same way. To illustrate this, let's take the e-commerce provider mentioned earlier: This one will notice an ever-widening gap between its advertising spend and its advertising performance. However, this does not have to correspond to reality, but is also a sign that the measurability of advertising performance is declining. One possible solution to this is to work more with modeling instead of just the actual measured values. By the way, Google Ads has been doing this for a long time; we also work with it.
The topic of "data privacy in marketing" contains several different aspects, from technical setup and legal guidelines to targeting and tracking, so it probably goes beyond what many people understand by "marketing." From an organizational perspective, what is the best way to approach it?
I recommend that the first thing to do is make an outline for the marketing of your own company. And it's definitely a topic that needs to be approached in an interdisciplinary way. Ideally, experts from the areas of marketing, technology, and legal are involved. It's about questions like: How do we measure the success of our campaigns? What kind of targeting do we choose? How dependent are we on third-party audiences? Only when these points have been answered is it possible to assess how strongly a company is affected by the developments. Then, a targeted approach can be derived that makes sense for the company. Depending on the goal, for example, targeting could be used that is not based on individual user behavior, but on attributes such as location, time, or context. If you previously relied heavily on retargeting, you need a strategy overhaul. If you rely on tracking your conversions, e.g. purchases in the web store, you urgently need to look into statistical modeling.
Let's assume that the urgency has reached the marketing department. How does it now convince management that they need to invest in this transformation process?
That depends very much on the results of the initial analysis as the need for action and its urgency are still very individual. If we assume that the current setup is heavily dependent on third-party data and the analysis shows that the success of the current marketing strategy is gradually diminishing, then the figures and forecasts speak a clear language. Again, it is important to look at the concern holistically: It's not just about eliminating third-party cookies, but about a holistic transformation process of digital marketing. This message must be conveyed.
"I am a great advocate of the motto 'Uncertainty creates opportunity': Those who remain curious, are open to new things, and continue to educate themselves have the best chances of gaining advantages and leaving the competition behind."
Principal Consultant, Webrepublic AG
The transformation process sounds pretty resource-intensive. Apart from the human resources involved, there may also be new tools and technologies. What kind of effort should companies expect?
Here, too, it's very individual, so I can only give a general answer (laughs). Everything can, very little must.
The more you look into the subject, the more you get the feeling that the rules of digital marketing are currently being rewritten.
You're not wrong about that. In my opinion, one of the biggest upheaval processes in digital marketing is taking place right now. But a lot is still up in the air: What will the legal interpretation of the GDPR look like? What arrows does Apple, a company that relies heavily on privacy, still have in its quiver? How will the debate in the USA about Google's supposed monopoly continue?
I am a great advocate of the motto "Uncertainty creates opportunity": Those who remain curious, are open to new things, and continue to educate themselves have the best chances of gaining advantages and leaving the competition behind.