As we discussed in our post last week, it’s clear that browser tracking cookies are nearly dead to advertisers and marketers. Mozilla released its Enhanced Tracking Protection for the Firefox browser last week, Apple keeps upgrading Safari’s ITP, and as we discussed previously, even Google is getting in on the cookie-crushing game. The big question on all our minds is what marketers and advertisers will do without third-party cookies? Should you give up on marketing and pursue your passion of painting koala bears eating ice cream?

You can put away the paintbrushes for now. While change is coming, marketing as we know it will survive without third-party cookies and solutions are already in the oven. Smell that? It’s the future of marketing.

Cookies Were Messy Anyway

The first logical thing to do when something you like is taken away from you is to justify its loss by saying it sucked anyway. This is actually in some ways true with the ubiquitous tracking cookie. Cookie synching aka cookie matching—which is used by demand-side platforms (DSPs) and data management platforms (DMPs) to sync cookies data so they know when they are dealing with the same user—isn’t exactly perfect. In the world of data-driven marketing, it’s actually pretty awful.

Unifying data is critical to providing personalized experiences to consumers, and it also must be done right to prevent annoying the everloving snot out of everyone. Where this tends to come apart for cookie-based targeting is when you take into consideration the massive amount of data that has to be synched up across the ad ecosystem. When a cookie from one site is not passed to an adtech platform, you miss a part of the puzzle and an appropriate match is not made. This happens often, and because of this, cookie match rates range from only 40 to 60 percent. This is why when you are searching for red Nikes on Zappos you end up getting retargeted with ads for black lingerie—which can cause other unforeseen issues for consumers at home. But, really, bad targeting from fragmented cookies is a big waste of money and annoys people with irrelevant ads. In addition to this, cookies are device-based, so they can’t help you when someone goes from desktop to mobile or switches computers or browsers, further fracturing the customer journey.

On top of that, a majority of tracking cookies are already rejected by browsers anyway. An ad-serving firm analyzed 20 advertisers and more than 5 billion impressions in fourth-quarter 2017, and found 64% of their tracking cookies were either blocked or deleted by web browsers. The rejection rate on mobile devices was higher — at 75%, compared with 41% on desktop. Because of this, advertisers can actually be throwing away half of their budgets on missed opportunities by not reaching potential customers and having dollars go toward unnecessary impressions to people who were going to convert anyway.

Are Standardized Ad IDs That Put Consumer Privacy First the New Cookie?

Organizations like IAB Tech Lab’s DigiTrust and the Advertising ID Consortium aim to create a standardized user token that prevents fragmentation of data. Additionally, IAB says that a standardized user “ID for Advertising” can eliminate the barrage of third-party cookie and pixel synch requests that slow down the user experience and make data sharing and collection a completely opaque process to the consumer.

IAB says that the way forward is “collaboration and cooperation among publishers, brands and their trusted third-party vendors around a neutral, standardized mechanism for consumer identity and privacy preferences. The standardized identifier must work in harmony with global regulatory frameworks for consumer privacy, and the privilege of access to the identifier must be coupled to the responsibility of respecting the standardized consumer privacy settings attached to it. And together we must hold ourselves accountable for responsible and ethical collection and use of consumer data, with complete end-user transparency and control.”

The caveat is that if standardized ad ids are still cookie based, conceptually they still can be easily blocked by tracking protection tools. However, the organization’s suggestion that the industry embrace the move to unified ad ids and realign efforts to put consumer privacy first to save audience recognition as we know it is wholly reasonable. It seems that this could be the only approach that does not attract another round of criticism and could allow for behavior-based retargeting. Either way, to restore consumer confidence in ad personalization there has to be transparency and choice, otherwise we just end up in the same place we are today.

How Digital Advertising Can Work Without Cookies

Okay, there has been a lot of talk about the future, but cookie blocking is here today. What can you do to replace the tracking cookie and still connect with your audience? Here are a few tactics that can help you break your cookie habit.

Contextual Advertising (and Content) is the New Cookies

What’s old is new again and contextual advertising is back. “We don’t expect a decline in ad dollars or a decline in ad traffic, we expect a reallocation and shift of budgets,” said Jon Kagan, VP of search at Cogniscient Media. “The next best option to cookies based behavioral targeting is anything keyword or keyword contextual-based advertising. Years ago everyone discounted it and we moved further and further away from keyword targeting, but now we’re going to have to go straight back to it.”

Contextual advertising is basically ads that are relevant to the other content on the screen. It’s like beer ads in a bar: go where your customers are. From the average non-marketer consumers’ perspective, contextual ads are more relevant and far less creepy feeling than cookie-based behavioral retargeting. Think of it this way:

With behavioral targeting, someone like you may get ads for martech platforms, ad agencies and the like everywhere you go on the web. But as an everyday consumer, you’re actually more interested in knitting. It doesn’t make much sense for you to get ads for Marketo when you are on Knitterly sharing your latest pattern—which could happen when behavioral targeting is being employed.

With contextual targeting, the ads you see are based on the content you are looking at instead of your overall behavior profile. So when you are looking at your knitting blog, you see ads for knitting needles, and when you’re reading up on how to the click-through rate on your email newsletters, you see ads for relevant email automation platforms.

The move to contextual targeting will also mean a move back to focusing on producing and distributing relevant content. Content is the new cookie (says the content marketer)! This is a bit easier said than done, though, as it will take more alignment between advertisers and publishers to make it work at scale. This article in Marketing Land outlines the four key steps publishers and advertisers need to take to executing this alternative to cookie-based behavioral targeting. A great takeaway is that content-as-ads works, mainly because people hate ads, but they like to be informed and entertained—and appreciate relevant offers while that’s happening.

The tools for contextual keyword advertising are available in Google AdSense, which allows you to place image, video, and text ads on the pages of participating sites online. This enables you to put dynamic content in front of people who aren’t necessarily searching for you. This article in Disruptive Advertising shows you how to get started with contextual advertising.

From the consumer perspective, contextual ads are way less creepy because they don’t give you the feeling that you’re being followed around the web. They only see ads that are relevant to the content they are currently consuming, so they are more relevant and in turn, more likely to feel invited to the party.  

People-Based Targeting

The shift to mobile has been hampering the effectiveness of cross-device remarketing for a while now, since most mobile devices and apps don’t accept cookies. This is not to mention that cookies are device-specific, so when someone goes from their work computer to home or switches from desktop to mobile, or even switches between browsers on the same device, the retargeting trail goes cold. It also causes trouble with suppression, so you also end up wasting money on retargeting people who already converted on their other devices. This is where people-based advertising comes and bridges the gap.

Introduced to the marketing world by Facebook, people-based advertising relies on a unique identifier that is related to the user, not the device. According to MartechSeries, people-based marketing is defined as “a means to create a customer-centric, cohesive marketing system that revolves around customers and their real-time behavioral data. This data, combined with available first-party brand data, allows brands to target customers in real-time, across devices and channels.” This method does not rely on third-party cookies to track users or gather data, and allows brands to meet customers in the places and times that they actually want to engage with them. “I don’t think that behavioral marketing is going to go away, but we will have to shift to looking at the behavior of known individuals,” said Kagan.

According to BounceX (who provides a platform that enables this to work), a successful People-Based Marketing strategy boils down to these three key elements:

  • Identification
    Brands need to identify their customers and connect them correctly to their various devices. The goal here is to ensure persistent, cross-device recognition for a single view of the customer. If this single customer journey is not tracked well, it could lead to incorrect assumptions about customer behavior, thereby causing inaccuracies in data which ultimately cause ill-designed marketing campaigns. To avoid that, brands must be able to identify their customer across channels and devices.
  • Data
    Today, brands have a plethora of data on each of their customers; from purchase data to email engagement to device information. The identification-first approach for customer data gives brands an upper-hand of targeting them effectively. Not just historical data, brands should also refer to real-time behavioral data like their device, their interaction with your website, their carts as well as the products and categories they visited while browsing. Linking together these data points allows brands to get a singular view of the customer.
  • Automation
    Instead of relying on cookie-based data, People-Based Marketing automation relies on people-based targeting. It helps brands unlock a singular view of the customer, anchoring all of the data to a single source. As a result, brands can automate and omnichannel marketing approach across all devices under a single cohesive marketing strategy.

The big catch here is customer identification and data. In the walled gardens of Google, Amazon, and Facebook, the customer remains logged in within these ecosystems across devices. Not to mention that they have more first-party customer behavioral data at their fingertips than anyone on earth. The feasibility of people-based marketing could be limited for brands that have don’t have adequate first-party data and login information about their customers. There are plenty of technology platforms that allow marketers to resolve identification and behavioral data like purchase data, email engagement, device information, but not everyone will have enough data to make this work on the scale and price point that cookie-based retargeting allowed.

First-Party Data is More Valuable Than Ever

Getting your hands on first-party data will be more important than ever in the absence of third-party cookies. Facebook, Google, and Amazon obviously have a huge advantage, but brands often have access to more data than they think. Not to mention that utilizing data from customers who have shown interest in reaching out to you is generally seen as more above-the-board than buying and selling access to third-party consumer data.

One untapped source of first-party customer data might be hiding in your call center. When your customers call you, they are literally telling you what they want and how they talk about it. To feasibly classify customer conversations into useful digital datasets, you need an automated system that can understand what’s being said and accurately derive meaning from it. Enter Invoca Signal AI — our machine learning-powered predictive analytics technology that analyzes your callers’ conversations and turns them into actionable marketing intelligence.

Learn how call tracking works with the Call Tracking Study Guide for Marketers

With Signal AI, not only can you predict whether a conversion happened on each call, you can predict things like caller type (e.g. service call vs. sales call), as well as milestones on the path to conversion. And when you understand the nature of a call, you can optimize your media for higher ROI, which can be particularly helpful when you are nailing down the right keywords to feed to your contextual advertising campaigns.

Invoca also enables you to unify your digital customer journey data to data from phone calls to create a single and comprehensive customer profile. By using online data collection and trackable phone numbers, marketers can attribute digital campaigns to actions taken on inbound calls. With this information being connected in the Invoca platform, you can analyze digital and call data in one place and get a more complete view of your customers.

How Cookie Blocking and ITP Effect Invoca Call Tracking Software

Speaking of call analytics, many of you probably came here to see what this means for the attribution data you get from Invoca, so here it is! Though Invoca’s call tracking technology does involve the use of cookies, it relies solely on first-party cookies, so it is not significantly impacted by any of these blocking technologies or regulations. Even regulations that limit the amount of time that cookies can last to seven days (or browsers that reduce that to one day) will not negatively affect most call tracking users. Our data suggest that 90% of customers call within one hour of being shown a phone number. Browsers with blocking technology will also refresh the cookie-clearing time counter upon a user revisiting a website.

The long and short of it is, the cookie apocalypse will not significantly affect the functionality or effectiveness of Invoca. And like many others in the marketing technology business, we will also soon be reducing our reliance on browser cookies for attribution to future-proof our technology.

Value, Transparency, and Choice Will Move Marketing Forward

While it seems pretty scary right now, keep in mind that cookies are a 25-year-old technology and we’ll definitely find a way to move on. It will take a combination of tactics, but moving forward, the marketing and advertising industry must not only provide more value to consumers from advertising, they must also strike a balance between profit and privacy.

A balance between personalization and privacy appears to be what people want. A recent Harris Poll survey revealed that 63 percent of consumers expect personalization “as a standard of service.” But they also expect and deserve to have the choice to be tracked or not, to get a personalized experience or not, and to see ads or not.

The days of finding workarounds are over. If marketers focus on making advertising more relevant and less invasive, consumers will likely see the value of it an choose to allow it in their digital lives.

No matter what, the consumer needs to be central—as does privacy—in the latest shift in marketing, or there will just be more backlash, more blockers, and more challenges for the industry as a whole.

Owen Ray

Posted by Owen Ray

Owen Ray is the Senior Content Marketing Manager at Invoca. Prior to that, he worked with SaaS companies like Aria Systems, Glassdoor, and Mindjet. Owen sharpened his writing tools at San Francisco State University and Bay Area newspapers before working his way into the Silicon Valley creative services set. He hails from Santa Rosa, California and definitely does not leave work early on Wednesdays to go drag racing at Sonoma Raceway.

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