First-Party Data Is the New Arms Race for Advertisers

To outperform competitors, strike the right balance between data and creativity

There is growing concern among brands and advertisers about how to deliver personalized experiences despite the signal loss we will see with the eventual elimination of cookies and iOS changes.

But the death of the cookie is overstated. It’s only third-party cookies that are going away (for now at least, as Apple’s Mail Privacy Protection in iOS 15 may signal future changes). It’s how marketers collect and use first-party data that is the new arms race.

Instead of focusing on what we will lose, we should be focusing on building the next evolution of digital media experiences. Because we can do way better than cookies.

To move forward, we need to create relevant (vs. personalized) experiences that meet the needs of customers and where they feel safe sharing data with their favorite brands. Consumers deserve privacy, and the exploitation of data by some brands has clearly violated that trust. In this new world, brands can also monetize that data and advertisers can see value in their investments. All without third-party cookies.

We can achieve this by approaching the customer experience holistically—from the tech stack to the design and UX, to the creative and messaging, through to media activation. In short, teams that strike the right balance between creativity and data will perform better.

Use tech to deliver more insights from first-party data

The thing that will make the biggest difference is a clear data strategy—specifically answering the question of how can brands identify the signifiers of behaviors they want to encourage? Brands need a strong data strategy and the technologies to capture the right data, translate it into signals and use it to dictate media activations. This includes:

  • Data capture, to collect signals and data points from the different advertising platforms
  • Data warehousing and storage for a single source of truth (like a customer data platform)
  • Data science and AI to mimic and predict future customer behavior
  • Data activation to leverage the owned data and predictive intelligence for a brand in media targeting strategies

Brands can augment their current tech stack to be able to support their data strategy and deliver more insights from first-party data. Too often today, we see clients that are capturing a lot of data, but it’s not structured to activate.

And, while brands certainly need to build up their first-party data, they also don’t want to market only to their customers. For brands where upper-funnel media plays an important role in growth, they should not rely only on first-party data.

The industry is moving away from straightforward deterministic models where conversions were tracked and attributed, to probability models for assessing the effectiveness of advertising. We can only do this with a clear data strategy and by using tech to collaborate with other collectors of first-party data (such as the walled gardens like Amazon and Facebook). Agencies can help brands to bring together datasets in clean room environments to augment their view of the customer and give them the insights they need. 

Retailers are a good model. They’ve been collecting first-party data and have tons of data about customer behavior in their CRMs. They are partnering with customer data platforms (CDPs) to use data more effectively and to make it actionable. When looking beyond data silos, unified customer data allows brands to prioritize and target users in different ways than before.

For example, Rituals, a home and body cosmetics brand, wanted to be able to predict the behavior of its customers and turned to Dept to build its CDP. We used machine learning to predict conversion intent by matching real-time browsing behavior to historical conversion patterns, resulting in a 40% savings in their remarketing ad spend without reducing conversions.

Data meets creativity

The data and the technology infrastructure needs to be coupled with creative and design experiences that move away from being focused on delivering a message to being focused on removing friction from the process. Creative is no longer just about message delivery in a brand-building channel. We need to shift to what we call “creative multi-moment marketing.”

Creative needs to make it easy for consumers to move on to the next logical step in the journey. Messages need to be unique and relevant to where they are in the journey (right person, right message, right time). We need to be able to understand less about who a person is and more about where they are and where they need to go. This will allow us to be less personalized and more relevant.

The richness of combined datasets will reveal the personality of customers. Who are they? What do they want? How do they feel? The relationship with creative is two-way—creative has to follow the data, but interactions with creative provides a rich source of data that improves our understanding of who customers are.

Creative also needs to help brands increase the share of people who are willing to become “known” to them. In some ways, brands will need to entice consumers to share their data going forward through exclusive deals, discounts or other perks.

A stronger connection between data, tech and creative will make it easier for brands to understand what their customers really want. It sounds obvious, and maybe even easy. But for many, it will require an organizational shift and a bigger focus on bringing marketing, tech and data together in the quest to find new customers and to delight the ones you already have. The cookieless future looks bright for brands that can bring all the pieces together.

Willem Blom oversees the media and data practice at Dept, a leading global digital agency with over 2,000 thinkers and makers in 13 countries. Previously, Willem founded Expand Online, a digital marketing agency in the Netherlands that joined forces with Dept in 2015.