Decoded: “the cookieless future”
October 18, 2021
Q & A with Ankit Mehta
The entire digital landscape is shifting under increasing consumer and government scrutiny of data and privacy issues. Here, Ankit Mehta, Accenture Interactive’s North America lead for Personalization & Experience Analytics, describes the “Cookieless Future” and shares what everyone should know about it.
How would you explain “the cookieless future” to a colleague, such as the Director of Procurement?
You’ve heard about the “cookieless future” or even the “cookiepocalypse,” but these catchy terms are misleading. It’s not just about third-party cookies! The digital experience and digital advertising are getting a complete overhaul because of different expectations about privacy, and regulations like GDPR in Europe and CCPA in California.
What we’re actually talking about is digital behavioral data. That’s used by all sorts of businesses who spend a lot of money on marketing their products and services and then use data across digital experiences, apps, mobile browsing experiences, desktop processing experience, etc., to figure out what people are interested in.
Changes around Google's third-party cookie deprecation, plus Apple's new app-tracking all provide more control for the consumer over how their data will be used by advertising companies and marketers. If you have a new iPhone and open an app, it will ask if you want that app to track you. First-party cookies, too, are now limited on certain devices and browsers like Safari.
A lot of people might say this trend is great, yet there’s a consequence: Their consumer experiences might get poorer and more frustrating.
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But if we can find a happy medium, people can have more control and privacy plus good online experiences.
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What are the potential ‘watch out’s brands should be aware of?
There's a lot of paralysis on this topic because it’s complex and touches everything from targeting to measurement to personalization to customer experiences. Our opening line to clients is: Do you know how this is going to impact your business? If not, we want to try to quantify that and then identify a plan that strikes the right balance between being privacy-centric and meeting business needs.
Recently, Google extended the timeline to give everyone a chance to land on the right solutions. Starting in late-2022, publishers and the ad industry will have about nine months to migrate their services. Then in mid-2023, Chrome will phase out support for third-party cookies over a three-month period.1
Our position is that clients could use this extension as a gift. It’s not a chance to wait and see what happens, but to test solutions over the next year. The industry has been sprinting to develop privacy-centric solutions and while some need more time, others are available for use and should be tested as soon as possible. Take advantage and don’t wait for the next “mad dash” a year from now.
What circumstances gave rise to this challenge?
It's driven by more consumer awareness about data privacy. People want to know how long organizations are collecting and storing data about them and how they're using it.
The forces of change are really around the technology companies and the legislation that's doing the work to change the foundation. So it isn't surprising that this is happening, but because it affects such a broad range of infrastructure, it’s getting a tremendous amount of attention.
These changes have been in the making for years, starting with Safari and intelligent tracking prevention, and Firefox with its enhanced tracking protection. In 2018, these two browsers had already started taking action around making third-party cookies unavailable to collect in the browser. Now that Google has taken a similar approach, most businesses can’t really operate in the same way as they did before.
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What’s the misconception about the future of cookies?
In addition to thinking it’s just about third-party cookies, what many people aren’t understanding is the size and the scale of the issue, because they’re not starting by quantifying the impact of all facets of data privacy. They’re hoping for one “silver-bullet” fix.
Imagine you’re having HVAC (heating, ventilation, or air conditioning) issues in your house. The specialist who comes over might say, “Look, there’s not one problem to address here, there are a dozen.” But if you start with the ones that have the most significant impact, maybe you can stop after you’ve handled six or seven issues, once you reach a pretty good efficiency with optimal air flow.
It’s the same with these data issues. You might need to buy a few tools and you might have to change legacy systems, too. Marketers shouldn’t look to apply band-aids; they should think of the situation as a reset.
If you want to collect first-party data to protect yourself from having to rent third-party data in the future, but the KPI is just how many customer email addresses you’ve collected, you’re missing a big point, which is: What’s the value to the customers? A data acquisition strategy is not enough to get you where you want to be. So don’t start with solutions, start with thinking about how to build better customer experiences and work backwards from that vision.
How could this impact a business?
We’ve run impact assessments for clients across multiple verticals including consumer electronics, online education, travel, insurance, financial services and energy. And we're seeing a typical loss impact of 15% to 30%. And when we dive into the details, it’s interesting to see where a lot of the signal loss comes from with respect to different types of marketing strategies.
We’ve also found that companies that have longer first-party data strategy and segmentation and overall orchestration with their experiences are actually better positioned to come out ahead of this.
Businesses should start by understanding their privacy readiness. This includes understanding things like privacy policies, authentications, consent management and how customer IDs flow through various parts of the ecosystem, to see which areas to double down on and which areas need some level of re-architecting.
Another step is to maximize customer IDs through meaningful living profiles. There's a lot of opportunity to personalize ads within the ad format itself versus via hyper-targeting. Many companies that we work with have built their own “clean rooms,” which allow for privacy-safe customer analysis.
Would you suggest readers act now to adapt to this trend, plan to act or just keep an eye on it?
This is one of the hottest topics on the business agenda. But there’s only so much left to talk about. It’s definitely time to figure out what you're going to do about it.
Ankit Mehta is the North America Personalization & Experience Analytics Lead at Accenture.
Sources:
1“An updated timeline for Privacy Sandbox milestones”, Google, 24 June 2021, https://blog.google/products/chrome/updated-timeline-privacy-sandbox-milestones/
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