The Cookieless Future Calls for Reinvestment in Customer Relationship Management

Every intelligent marketer throws terms like "data activation" around freely. But what does data activation mean? And where does it get applied? Here, we will go into detail about the critical stages for a growth marketer to understand data activation. The growth cycles have been generalized for the most common use cases and can be translated into various processes elsewhere. There are three stages in general: Pre-registration: At the start, where you or your enterprise is wooing customers to sign up. You're working with zero-party data; you don't have customer first-party data willingly given to you. Conversion: A customer has trusted you to share their first-party data but has not made their first purchase, also known as registration to first purchase.Loyalty cycle: A customer has made the first purchase, but the enterprise has yet to make a repeat purchase, cross-sale or upgrade. Most cycles above are very transferable to most businesses. In the marketing world, these translate to the following funnel stages: Pre-registration translates to upper funnel—Google and Facebook are beneficiaries.First purchase translates to mid-funnel—Salesforce and Mailchimp are beneficiaries. Loyalty translates to lower funnel—Facebook Messenger and Kustomer.com are beneficiaries. Most providers' activation channels are not locked into a part of the funnel. However, the impact of privacy has been felt at the top end of the funnels, where customer data is being limited as cross-domain identity and third-party cookie identity go away. As privacy headwinds, consent and data zoning compliance come into play—besides the cookieless world ahead of us—the customer relationship management (CRM) cycles are getting impacted significantly. Here are some facts to consider: Third-party cookies will be gone by 2023.30% of the internet blocks cross-domain trackers.40% of the internet limits cross-domain trackers to seven days. These conditions significantly change how the various CRM stages work. Upper funnel/pre-registration In the upper funnel, the enterprise has an idea of what segments it wants to attract so they can convert them faster. However, at this stage of the funnel, the enterprise has little idea about the customer they bring to their site. They rely on channels like Facebook or Google to drive a customer to their site. When a customer engages, signals are passed back to Google or Facebook, enabling them to understand how to tune the upper funnel to have the most optimal spend. This is typically the most significant spend. Some enterprises choose to use probabilistic data from providers like Liveramp or ID5 to acquire customers faster by reaching them more often once interest is established. However, the rules for this game are changing quickly. Upper funnel impact Without identity and cross-site trackers (third-party cookies), the impact on the advertising industry is monumental. There is no easy way to identify a consumer on the internet anymore, and SaaS companies that track using cross-domain trackers are limited to a maximum of seven days. Without enterprises investing in their infrastructure, they are unable to track their customers beyond a week, or at all with ad blockers. Mid-funnel/registration In the middle funnel, the enterprise has some trust with the potential customer, which can be used to drive conversion. Most companies will use email marketing for this purpose, or when a customer has downloaded an app, one can use push notifications to activate the customer. This is not as expensive of a stage, but this is where an enterprise starts to build trust, and the investment to get customers to this stage can disappear quickly. Some enterprises will use the email collected to retarget customers to reach them via non-email, push or other channels. Lower funnel/loyalty This cycle is different from others; this is more about how an enterprise builds trust and repeats sales cycles. For product-led growth companies, this is the most challenging cycle, and knowing how the customer engages with the brand is essentially the deciding factor. Convenience, customer service, visitation and social media all play a role in this cycle. Enterprises will use all channels here, as the chance of an existing customer driving average revenue per user (ARPU) is a better spend than acquiring new customers. Middle and lower funnel impact With the mid- and lower funnel, the ability to track an enterprise's customers on their sites beyond seven days (or ever) is still impacted by reducing the ability to know when customers are visiting you and limiting the chance to convert them. This is a significant loss of revenue for the enterprise, and they cannot activate CRM. It's investment time It's about time to invest in building infrastructure that catalogs your customers, captures their consent and enables building trust. This will lead to better retention, retargeting and a significant upside in revenue. The loss of identity is not just an ad tech issue—it's a measurement, attribution and, eventually, activation issue that needs resolving. Today, you are already losing 30-35% of your growth ROI, and you are likely not remarketing to your existing consented customers. The investment in CRM alone will pay for itself and save you from spending money with SaaS companies that are leaking revenue.