Benefiting from Zero-Party Data Requires Focus on Your Process

The world of digital advertising is changing rapidly, and one of the biggest changes in recent years has been the ban on third-party cookies by Google. This move has had a significant impact on brands that rely on third-party data to drive personalization and measure performance. So, Let's explore the impact of this ban and how poor data and fragmented processes affect brands that do not have a strategy for using first and zero-party data.

Concerns about privacy and data security when it comes to third-party cookies has been a hot topic. Many users are uncomfortable with their online behavior being tracked (me included) and used for advertising purposes. I know that whenever I see that cookies pop up, if I have the option to block them, I do. In response to these concerns, Google announced in early 2020 that it would phase out third-party cookies from its Chrome browser by 2022.

So, what is the impact of this ban on brands if they rely on third-party data or have little to know First and Zero-Party Data? The answer is that it varies depending on your marketing strategy. Brands that have had a strong first-party data strategy and have built a loyal audience on their own channels are less affected by the ban. They can use their own data to target ads and measure performance, without relying on third-party data.

However, brands that do not have a strategy for using first and zero-party data are facing significant challenges. Without third-party cookies, it is harder to track user behavior across the internet and target users with relevant information. This can result in a decrease in conversion rates and a lower return on investment (ROI) for advertising spend. According to Gartner, organizations believe that poor data quality is responsible for ~$15M per year in loses, and a 2017 Accenture survey found that poor personalization could be costing US businesses as much as $756 billion in lost revenue!

To overcome these challenges, brands need to invest in building their own first and zero-party data strategies. Quality first-party data can be achieved by implementing robust data collection processes and regularly reviewing and updating the data. Brands should also ensure that they are collecting data from a variety of sources, such as website analytics, social media, and customer relationship management (CRM) systems. This helps to create a more comprehensive view of their audience and allows for more targeted advertising. By collecting and using their own data, brands can gain a deeper understanding of their audience and create more personalized and relevant advertising experiences.

Zero-party data is extremely valuable, since it's provided directly by the user and can be used to create highly personalized advertising experiences. Brands should make it easy for users to provide this type of data, such as through surveys, preference centers, or other interactive experiences. Many organizations have this already in the form of loyalty programs. Many times these are seen as cost centers, but that mindset needs to shift. Brands that are able to leverage this goldmine will ultimately win with their customers and their balance sheets.

However, simply collecting quality first and zero-party data is not enough. Brands must also be able to drive action on that data to pivot and adapt their advertising strategies based on the insights gained. And they need to do it fast. At Brooks Bell, we have seen on average that it takes 10 months for companies to take action on an insight. I don't know about you, but I am probably not in the same buying cycle now as I was 10 months ago. How brands share insights requires the right people, processes and governance to move that information through their organization to the teams that can execute on it.

For example, a brand may notice that when a certain audience is presented with a different hero message, based on loyalty data you have gathered, they follow the call to action 60% more often. How quickly can your team test this in higher velocity to determine if its isolated or not? How quickly can they analyze that data and then share that insight with the Marketing or IT teams who make these updates? How many layers of approval are needed to make these changes? What if the test was seasonal and needed to be acted on in record time to capitalize on the opportunity?

Think about your organization. How would you rate your speed to action on a 1-10 scale?

If you cannot confidently say you are hitting a ten, Brooks Bell can help. We are uniquely positioned to benchmark your programs, make impactful recommendations about your people, process and governance that will not only impact your bottom line, but also save you in time and employee satisfaction.