How Marketers Can Prepare For Privacy Changes
No one likes the feeling of being followed around the internet bombarded with retargeting ads. The distaste for this experience is actually so widespread that over the past few years the entire digital advertising industry has made privacy a focal point of innovation.
From GDPR to CPRA to the death of the third party cookie (on Chrome), the landscape is constantly shifting while leaving advertisers lost looking for answers. Sure, there have been a handful of innovations that help practitioners to remain compliant in the age of privacy, but some of these features are keeping paid media programs together with duct tape and bubble gum. Delivering strong performance in the coming months will require digital marketers to shift their behavior in some of the areas outlined below.
Change One: Moving on From Cookie-Based Events
Advanced advertisers understand that feeding platform algorithms more quality data will improve campaign performance. For brands with longer lead cycles, this can often take the form of creating “micro conversions” that represent actions a user typically takes on a brand’s website before that user actually becomes a customer. These micro conversions are typically set up using event tags, commonly via Google Tag Manager. This will no longer be possible when Google Chrome sunsets third party cookies.
The impact of this change is significant given that event data can be used to:
While the notion of losing this data might give way to some anxiety, there’s no need to panic. Advertisers will need to shift their focus from leveraging tag-based solutions to implementing server-to-server (S2S) tracking.?
Most ad platforms already have some sort of S2S capability built out through a conversion API. Many paid social platforms are simply labeling this as their “Conversion API” tool, but there will be some differences, like Google’s take on this functionality has been dubbed “Enhanced Conversions.” A big consideration here is that digital marketers most likely won’t be the people actually implementing these S2S setups unless they also double as a developer.?
Therefore, it’s important to begin understanding how to communicate with developers so that requests for new conversions are clear, and both parties are aligned on expectations around timing for execution. Once the initial S2S connection is made, it will be on advertisers to understand how to optimize this data flow. A good starting point to making S2S data feed optimization can be asking questions like:
Instead of understanding triggers and variables, these are the concepts that paid media experts will need to master in order to improve the quality of their campaign inputs (see automation post). However, event data is only one type of data that is being impacted by changing privacy regulations.
Change Two: Actively Leveraging 0P and 1P Data
This change isn’t necessarily about shifting behaviors, but rather developing a new one. Many paid media professionals don’t currently have a hand in building out strategies to capture or leverage zero and first party data. This will need to become a more prominent responsibility within an advertiser’s role over the coming months.
First, let’s begin with some basic definitions.
Zero party (0P) data is information that is willingly given to a brand when interacting with that brand in a digital space. Examples could be providing an email address, filling out a quiz with certain preferences, or completing a survey.
On the other hand, first party (1P) data is behavioral information that is observed by a brand, often taking the form of website interactions. Depending on who you talk to, both of these data types might be grouped into 1P data, but the basic concept remains the same. Both 0P and 1P data are collected in a privacy-friendly way, and owned by the brand collecting the data.
Now we need to understand why 0P and 1P data are so important to the future of digital marketing. Third party (3P) audience solutions will become more sparse over the next two years, and most likely less effective. (More on 3P data in the next section.) That’s not to say that there will never be effective innovations in this space, but the recent changes in privacy regulations have sent many audience providers back to the drawing board. Despite this loss in third party audience signals, advertisers can begin to rely on the rich data found in 0P and 1P data collected by the brand they support.
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Due to the fact that 0P and 1P data is collected on digital properties owned by a brand, the data is far more relevant than what 3P data providers could ever deliver. In the past, a clothing retailer might be able to use 3P data to target consumers interested in tee shirts, but 1P data might reveal that there is a surge in interest for green men’s tee shirts that come in medium and large heading into the spring season. That opens up an opportunity to create more granular targeting. I hope that this quick example illustrates how advertisers will be able to leverage 0P and 1P to introduce more personalization into ad experiences.
The behavioral change now becomes leveraging 0P and 1P when this wasn’t a common practice previously. Digital marketing will need to understand how to use web analytics tools like Google Analytics 4 to capture this data, then synthesize the insights gleaned from it to create audiences with a high propensity to purchase. Iterating upon this process can provide a paid media program with a powerful source of data to fuel in-platform automation and drive performance. While there will certainly be a learning curve here, platforms like Segment or Hightouch can help to streamline implementation.
Change Three: Testing Platforms With Unique Data Offerings
I know that I just placed a lot of emphasis on how powerful 0P and 1P data can be compared to 3P, but unfortunately 0P and 1P can only be leveraged once a potential customer has already interacted with a brand in some form or fashion. This means we still need a solution to reach users whose needs align with a brand’s offering, but haven’t yet discovered that brand. Building brand awareness might require a slightly different approach in a privacy-driven landscape.
A common practice for building brand awareness today is to leverage media types that have a wide reach for a relatively cheap price. I’ve already shared some thoughts around why I think this is a potentially flawed approach, but there will be an even greater incentive to re-evaluate a brand’s media mix in the coming months. Running a display or paid social campaign with broad targeting can result in a high degree of inefficiency for products or services that have a higher ticket price and/or longer user journey. In order to effectively construct an audience strategy that accounts for privacy limitations, advertisers will need to leverage the 1P data their brand has collected, as well as 1P data that ad platforms have collected. I’ll walk through an example to illustrate this point, but I want to call out a consideration first. Regardless of which platform you’re working in, you’ll want to negate any audiences you’ve built using 0P and 1P data when the goal of a campaign is brand awareness. Now on to the example.
LinkedIn is a popular platform for B2B advertisers because it’s collected a large amount of 0P and 1P data. Each LinkedIn user has populated their profile with data specific to their professional occupation, and LinkedIn can use that data to provide durable targeting solutions that don’t need inputs from outside sources. LinkedIn data is privacy compliant, and it provides flexible targeting options.
While an advertiser running a LinkedIn campaign is technically leveraging 2P data, that same data is 0P and 1P data to LinkedIn. I understand this can be a bit of a brain exercise, but hopefully the following concept is straightforward.
When evaluating potential ad platforms, consider what unique data that platforms owns regarding its targetable users. These will be platforms that provide some sort of service other than advertising.
These platforms are more than just a DSP connecting to ad inventory, they use the data they collect from users in a consensual manner to provide more relevant ad experiences. This typically results in strong campaign performance as well. Evaluating potential ad platforms through this lens will be an important practice as privacy policies change how these tools operate.
Change Four: Working More Closely With Legal
A common theme in this disruption series has been breaking down silos to work more closely with departmental teams that are tangentially related to marketing. The world of privacy provides no exception here. Marketers will need to work more closely with their legal teams than they ever have before. Even an accidental misuse of data can result in thousands or even millions of dollars in fines.
Close coordination between the advertising, legal, and web teams will be necessary as new potential policy changes are presented in various legal courts at the state, national, and international levels. This level of collaboration might not be necessary on a consistent basis, but developing these relationships within an organization will ensure a brand can not only protect itself from potentially costly mistakes, but also propel its paid media program forward with the use of additional owned data signals.
Wrapping Up
One of the unique characteristics of developments in privacy is that they’re not brand or ad tech driven; these changes are the result of consumers and policy makers voicing their concerns. Therefore, digital marketers are currently in a reactive state, opposed to proactively innovating around privacy compliance. That’s completely fine, as long as advertisers are equipped with the knowledge to successfully navigate this relatively new space. Some of that knowledge can be found in the the topics above which covered:
These are small straightforward behavioral changes that paid media professionals can begin implementing today to prepare their programs for the inevitable privacy changes of the future.