Consumer data privacy: A survival guide for digital advertisers
If you’re frightened by the depreciation of third-party cookies, ad-blocking features, and other industry-shattering updates to consumer privacy, you’re not alone. These changes will have a pivotal influence on the digital landscape, rendering traditional, cookie-based approaches to ad targeting and performance measurement obsolete. This guide will tell you everything you need to know to adapt.
Digital advertising has always been a fluid industry, constantly reinventing itself.
Often, this reinvention is driven by factors inside the industry—e.g. a disruptive brand transforms consumer expectations or a new technology provides an unprecedented edge over competitors. Recently, though, the shifts occurring in digital have been driven by external factors: Namely, the new consumer privacy updates by Apple, Google, and regional governments.
You’re probably wondering: What do these changes mean for me? If I can no longer rely on traditional approaches to ad targeting and measurement, then how can I adapt?
Read on to learn more about:
- What the changes to cookie and device-based ad targeting mean for you.
- Why increasingly limited data is creating challenges for performance measurement.
- Which tools and strategies you need to excel despite these limitations.
- How to leverage your 1st party data to make up for the loss of 3rd party data.
Privacy changes likely affecting your digital advertising today
Apple’s privacy update
Apple is in a significant position to transform the privacy landscape, with about 50% current market share and nearly 100% upgrade rates. With the release of iOS 14.5, Apple made it so users can now opt-in or out of device tracking. By default, users are now opted out of device tracking across apps, and permission for tracking needs to be explicitly opted into for each app.
Specifically, apps must now ask data permissions for things like:
- Targeted ads.
- Share identifiers (e.g. advertising).
- Data collection (e.g. location).
If apps do not ask user permission to collect and share data, they’ll be removed from the App Store—and therefore, all iOS devices. Currently, opt-in rates vary by app, but the worldwide average opt-in rate is only about 20%. That means that millions of devices you used to track have removed your ad tracking permissions, causing difficulty for both apps and advertisers.
Chrome’s depreciation of third-party cookies
Google recently announced that by 2023, third-party cookies will no longer be enabled in Chrome. Tracking cookies have already been blocked in Safari and Mozilla Firefox, so Chrome’s update will mean that 90% of the third-party cookie-based ecosystem is gone. This includes all cookies seen as being third-party activities, affecting measurement, analytics, retargeting, site optimization, and more.
Each of these changes are part of a long-term and ongoing privacy evolution, starting with Safari’s Intelligent Tracking Prevention feature released in 2017. Across the industry, browsers are focused on reducing cross-site tracking at scale.
How less third-party data tracking across apps and devices impacts your advertising campaigns
Over the past decade, brands and retailers have been steadily collecting more customer data. This big data in the retail industry has acted as the fuel for many advertising campaigns, providing advertisers with the ability to identify and segment audiences, personalize communications, and track performance across channels and devices.
Now that users are able to opt-out from this tracking, you may struggle with:
- Targeting: Without third-party data, you’ll struggle to create granular, web-based custom audiences or lookalike audiences for more precise targeting.
- Experiences: Less data means it’s more difficult to serve personalized, dynamic ads, inhibiting your ability to maximize the value you get out of campaigns.
- Measurement: A lack of third-party data interferes with multiple areas of measurement, including attribution windows, delivery breakdowns, A/B testing, offline conversions, and Facebook attribution.
Marketers with a high reliance on device tracking will see the greatest negative impact to their advertising: Namely, a drop in addressable users, impediments to performance data, and an overall drop in ROI using traditional approaches to advertising. However, those who run campaigns independently of device tracking—using first-party data—will only feel a small hit by the new limitations, and likely bounce back even stronger, improving the overall customer experience they offer.
Bottom line: You need a new competitive advantage
When Facebook and Google advertising first began, they offered a high yield at a low price.
As a result, advertisers flocked to them, over-saturated the platforms, and drove pricing up while yields dropped significantly.
Today, you need to look outside these platforms for a true competitive advantage. A new advertising ecosystem is emerging, in which:
- Brands relying on third-party, platform-supplied data are most restricted.
- Brands with a strong capability of using first-party data are least impacted.
- The results you can expect from paid social advertising, including CPM and conversion rates, are in flux.
- Ecommerce is gaining traction over digital advertising, making first-party data the key to navigating the new privacy landscape.
Your ticket to success in a post-cookie world: First-party data
First-party data allows you to serve targeted digital ads in a personalized and privacy-compliant way. In the wake of the new privacy regulations, now is the best time to start connecting, collecting, controlling and analyzing your first-party data.
It provides you with a critical marketing advantage in the post-cookie world:
- Audiences and targeting are improved with more reliable and relevant first-party data.
- Measurement and campaign performance tracking is made easier by tracking first-party audiences against the most important metric: Revenue.
- Engagement is improved because first-party data allows you to build genuine, two-way relationships with each customer.
Customer data platforms (CDPs) can help you collect and manage first-party data with ease. By unifying all of your data across channels and platforms into a single customer view, you can identify your highest-value audiences and improve customer relationships with personalized messaging—all while meeting the highest standards of privacy, security, and compliance. Read this checklist to help you choose the right CDP vendor for you.
Lexer is the CDP vendor of choice for leading brands like Quiksilver, Igloo, Zimmerman, The Iconic,, Rip Curl, Supergoop!, and more. As the only CDP built for retail, we help the world’s most iconic brands drive incremental sales from improved customer engagement.
Want to dive deeper into the data privacy landscape? Click here to download the full NORA Retail Up talk, “Consumer privacy changes are disrupting your digital targeting and measurement,” with Lexer’s VP, Strategic Solutions, Max Flanigan and Founder & CEO of St. Frock, Sandradee Makejek.