As the Chief Data Officer at Local Planet, I’m acutely aware of the seismic shift our industry faces with the impending phase-out of third-party cookies. This transition, while challenging, presents a unique opportunity to rethink and rebuild our data strategies, ensuring a more sustainable and privacy-conscious approach to digital advertising.
Understanding the Problem
The (ever closer) deprecation of third-party cookies marks the end of an era in digital advertising. For years, these cookies have been the backbone of targeted advertising, enabling marketers to track user behaviour across the web, gather insights, and deliver personalised ads. However, growing concerns over privacy and data security have led to regulatory changes and a push from tech giants like Google and Apple to eliminate third-party cookies from their browsers.
According to McKinsey, the loss of third-party cookies will significantly impact advertisers, particularly those relying on detailed behavioural and demographic insights to create targeted campaigns. This shift will force advertisers to adapt quickly, leveraging new data strategies to maintain their effectiveness (McKinsey & Company) (Deloitte United States). Gartner reports that 75% of marketers still heavily depend on third-party cookies, with many fearing a decline in campaign performance and measurement accuracy as these cookies disappear (Adapt).
The Solution: Embracing First-Party Data and Contextual Advertising
To navigate this new landscape, agencies must pivot towards first-party data and contextual advertising. Here’s how:
1. Strengthen First-Party Data Strategies: The importance of first-party data cannot be overstated. Collecting and leveraging data directly from consumers who consent to sharing it is crucial. This data is more reliable and aligns with privacy regulations. High-growth brands are already leading the charge, with 61% shifting to first-party data strategies (Deloitte United States). At Local Planet, we have enhanced our capabilities to support our clients in their first party data strategies, with best-in-class data clean room technology built into our Global Audience Platform, Blu.
2. Move Towards Consented Data Sources: To support our clients effectively, we have built Blu, a Global Audience Platform that utilises consented data, enabling us to move away from third-party data and address the gap left by cookies. Blu currently boasts 2 billion data points, integrating various consented data sources to provide a comprehensive and unified understanding of consumer behaviour across multiple devices, while respecting privacy. By doing so, we help clients deliver personalised experiences across different markets, enhancing engagement and loyalty.
3. Leverage Contextual Advertising: Our proprietary Advanced Contextual Advertising Platform, 4D, targets users based on the content they consume rather than who they are. This is a viable alternative to behaviour-based targeting, ensuring ads are relevant to the user’s current context and increasing the likelihood of engagement without infringing on privacy. However, this approach requires a nuanced understanding of content and creative adaptability to match editorial environments effectively (Adapt).
4. Forge Strategic Partnerships: Collaboration is key in the cookieless future. Forming alliances with tech providers, publishers, and other stakeholders enables us to pool resources and expertise, driving innovation in privacy-compliant targeting methods. Retail media networks, Connected TV, and digital audio platforms are emerging as critical areas for data collaboration, providing rich first-party data for targeting (McKinsey & Company).
5. Invest in Technology and Innovation: Supporting client investment in technology, such as Customer Data Platforms (CDPs) and advanced analytics tools, is essential. These technologies help manage and analyse first-party data, enabling sophisticated targeting and measurement. Moreover, leveraging AI and machine learning enhances data processing capabilities, delivering deeper insights and more effective campaign strategies (McKinsey & Company).
Moving Forward
As we transition to a cookieless future, it’s imperative to remain proactive and innovative. The shift away from third-party cookies, while challenging, is an opportunity to create more ethical and effective advertising strategies. By focusing on first-party data, contextual advertising, strategic partnerships, and technological investments, we can navigate this new landscape successfully.
At Local Planet, we are committed to leading this transformation, supporting our clients in building resilient, privacy-first data strategies that drive meaningful engagement and sustained growth. The future of advertising is here, and together, we can shape it for the better.