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A year after Google announced they would be phasing out the third-party cookie from their Chrome browser, there is still no widespread agreement amongst advertisers, agencies and publishers on how to transition away from this reliable tracking tool without losing accuracy and scale. Since then, Apple have announced privacy updates to iOS, meaning users can more easily view and limit the tracking capabilities of applications. This affects those who rely on location-data, as users must now opt-in to tracking and can easily manage the level of precision shared. Across the board, industry players are pivoting to turn these changes to their advantage, chiefly through the introduction of new platforms and AI technology capable of matching various data signals to enable identification.
Unified ID 2.0 by The Trade Desk is one such example of a new open-source ID framework. Working with collaborators across the ecosystem, including the IAB, they have developed ubiquitous ID whilst protecting consumer privacy. This is constructed from hashed and encrypted email addresses, enabling single sign-on (SSO) functions for users. It is made clear to users on setup that they are providing their data for access to free content from publishers, funded by advertisers. Users can then manage their preferences easily through this framework, providing transparency on what data is shared and putting the power back under personal control.
This is part of a broader movement to give users greater control of what data they share. Although in their infancy, personal data servers (PDAs) allow users to build their own digital identities and apply this to SSO, financial and app verifications with data they have confirmed themselves. For the 1.8 billion people who do not have a legal form of identity, this is a route to recognition.[1] For everyone else, it will allow for an alternative digital identity away from the current tech giants. Potentially, consumers will also be able to cash-in on their data, providing granular and relevant targeting for publishers, but in exchange for a percentage of the advertising revenue.
What this all boils down to is a need to put the consumer as the centre of the digital identity. As marketers, our hunger for greater measurability contributed to the current status quo; where consumers have little control over their digital identity and the advertisers using their personal data are seen as untrustworthy. We now have an opportunity to create a harmonious relationship with consumers by working with them to provide a more detailed understanding of their needs.
Many brand managers will wonder how they can affect change when the digital ecosystem appears so complicated and dominated by big tech firms (‘Facebook vs the Australian government’ is a case in point). Many of the FMCG brands we work with, whose products are still largely sold in physical stores, have not placed these challenges high on their agenda for good reason. Pure play retailers have relied on third-party cookies to drive conversion for their suppliers, but physical retail has largely been removed from issues around online privacy in the past. However, as consumer behaviour becomes more varied and online grocery shopping grows in popularity, established brands investing online will require ways to maximise reach amongst broad target audiences without the aid of cookies to drive conversion. This challenge is only going to grow exponentially. The latest research has shown £3 in every £10 is now spent online in the UK,[2] and the ecommerce market has grown 19% YOY.[3] Clearly FMCG brands must now push the challenge of digital identification and privacy up their agenda.
FMCG brands need to take a holistic approach to audience identification and engagement, accepting the fluidity in which consumers move between physical and digital touchpoints as they shop. This new approach needs to put context at the heart, building rich conversations with consumers that are informed by data, but which also feel personal.
Thankfully, brands can plan and implement digital campaigns around a host of alternative datasets that are not dependent on IDs alone and which can arguably be equally as effective in the FMCG category. Because most of FMCG is impulsive by nature, we are less reliant on techniques such as retargeting to win sales. Instead, being relevant and present at exactly the right moments on the consumers’ path to purchase should be a marketers single most important consideration. Google have talked about this as ‘the power of showing up’; how being present in moments of deliberation can be enough to win or retain a shoppers’ preference. Likewise, former Chief Marketing Science Officer at the Advertising Research Foundation, Dr. Augustine Fou, has written that broadening the focus of digital targeting can improve busines outcomes and that basic targeting methods of old are proven to be more effective than hypertargeting.[4]
Food and drink brands, for example, can have relevant and meaningful conversations with shoppers in a multitude of settings, from reaching them on their mobile outside the front of a store or whilst they are browsing for recipes online from the sofa. Both are contextually relevant, and both can use a range of intelligent audience identifiers to justify their selection. In the past, brands who have achieved this context-first approach have looked beyond single audience identifiers and have used a variety of insights, tools and technologies to build an understanding of their target, and from there form meaningful relationships with them in a relevant space. No one can be wholly defined by their web browser after all - what matters more is the quality and timing of the digital interaction between the brand and the consumer.
Connect-R by Capture allows brands to combine offline and online identification methods to help build stronger, more profitable consumer marketing. We have spent the last 10 years specialising in shopper marketing and helping brands win at the moment of purchase. As the groceries market has expanded online our expertise has adapted to help our clients wherever their marketplace. Connect-R gives brands the resources and skills they need to communicate universally with their shoppers and achieve that all important conversion. Limitations around transparency in the FMCG sector have forced us to find unique and sophisticated ways to measure incrementality on our ad spend. We interrogate all new technology in our sector through this lens, asking ‘how will this improve business outcomes for our clients?’ and ‘how can we prove it works?’. At Capture, we view the loss of the third-party cookie as a positive catalyst, offering a fresh opportunity to think about what really works in the digital age.
The new world without third-party cookies should bring back an emphasis on diversity in the marketing approach. We should be striving to give value to the consumer in exchange for their personal data. To do this, we need to show them we truly understand their needs, and this can only come from intelligent, multi-dimensional strategies. For the FMCG sector, growing in the online world, there is an opportunity to reshape the online consumer experience for the better.
[1] ‘Personal data servers will help take back digital ID from big tech’, James Kingston and Irene Ng, Friday 22 January 2021 https://www.wired.co.uk/article/personal-data-servers [2] ‘Internet sales as a percentage of total retail sales (ratio) (%)’, ONS, March 2021, https://www.ons.gov.uk/businessindustryandtrade/retailindustry/timeseries/j4mc/drsi [3] ‘£5.3bn boost for UK’s ecommerce sector due to pandemic’, Ben Stevens, June 2020, https://www.chargedretail.co.uk/2020/06/15/5-3bn-boost-for-uks-ecommerce-sector-due-to-pandemic/ [4]‘Audience targeting: Why losing cookies may not matter’, WARC, Dec 2020, https://www.warc.com/newsandopinion/news/the-demise-of-the-cookie-remains-top-challenge-for-media-in-2021/44456