Fundamental changes are on in the world of digital marketing due to regulatory as well as customer expectation-driven changes in privacy in all its facets.
These new privacy regulations, the rise of ad blockers and the decrease in the availability of data used for measurement and targeting taken together will fundamentally alter standard operating procedures (SoPs) in digital advertising.
Major transitions in advertising modality in every era have led to big opportunities for advertisers, provided they adapt successfully. For those who fail to do so, it is a highway to oblivion.
The necessary action streams are in three parts: Creating a durable infrastructure; finessing the measurement strategy; automation and broadening of advertising deployment.
Read more: Data privacy: How to keep your personal and financial information safe online
A cookie-less world
One has to concede that third-party cookies and non-consented device IDs are going to see their sunset. This would mean advertisers need to begin rebuilding their advertising infrastructure so they can perform without these tools in the coming near future.
One way to create a more durable data infrastructure is by investing in building better, longer-lasting relationships with customers, or eventually spending much more to target and capture intenders on third party websites and social media platforms. The era of a focus on first party data capture and owned data collection is upon us.
Read more: Why is Google delaying the deprecation of cookies?
Next, it would be wise to invest in customer engagement platforms which enable us to communicate with customers without cookies across multiple channels (e.g. email, SMS, push notifications, chat, social CRM). These platforms can help increase conversion rates and customer lifetime value (CLV), boosting the profitability of paid marketing investment.
Privacy issues should also be a catalyst to improve the overall customer data infrastructure right now. It is best to partner with a cloud provider to build a data lake, create unique customer identifiers across products, channels, and customer service touchpoints, and begin building a more robust customer insights platform.
Learnings from leading retail players indicate that customers who shop both online and in store are 10X more valuable than customers who shop online exclusively, and one can only understand this with a full view of customer interactions. This puts direct-to-customer players with authentic first-party customer data at a distinct advantage as they move omni-channel.
It is imperative to invest in technologies that will help to improve conversion tracking without third-party cookies.
Loss of measurement data such as 24-hour conversion windows, loss of view-through conversion data on Safari, and the loss of some user-level conversions in iOS apps is already making it harder to precisely measure the business impact of paid advertising. This data loss is likely to accelerate further. Hence, actionability as well as return will be impacted by the above-mentioned changes.
Read more: The importance of customer metrics in revenue growth
So, what can be done?
It is important to sharpen the attribution model by leveraging machine learning (ML) and conversion modelling. This approach will help us have more complete data for attribution, in a privacy-safe way, even as actual conversion data erodes. ML is geared to give us a better understanding of conversion paths across platforms and devices, in a privacy-friendly way.
Next, it is wise to complement the attribution model with a Media Mix Model, modernized for the digital age. Constant experimentation that complements measurement will be the future of advertising impact assessment.
Lastly, it is good to reconcile to the fact that impact measurement of paid advertising will become less robust. Decision making under ambiguity will be a necessary attitude.
There is a massive tsunami of privacy related changes which can be only survived by a willingness to change, unlearn and relearn. Like it or not, it is going to be a massive deluge and one does not have the option of wetting one’s toes when that happens.
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