Five steps to make up for lost data in a cookie-less world
If your marketing and technology teams haven’t started preparing for a future without third-party cookies, you may be falling behind. It’s not too late to start, but it’s certainly time to begin thinking about how you’ll replace third-party cookies in your marketing attribution.
Third-party cookies will be obsolete by the end of 2023 or perhaps early 2024.1 This means that marketing leaders across all industries and sectors need to work closely with IT leaders to set things in motion so they can continue targeting their customers, meeting customer demands for increased data privacy and transparency, and still effectively measure the success of marketing efforts.
This article will guide you through key steps your organization can take to prosper in a world without third-party cookies.
When we say that cookies are “going away,” we’re specifically talking about third-party cookies. (See sidebar) Third-party cookies are tracking codes (generally JavaScript) dropped in a user’s web or mobile browser. The cookies, because they are associated with the users’ browsers, persist – or remain detectable – after a user navigates to different webpages and between sessions. They even persist after browsers are closed and later re-opened.
Clearing cookies, browsing with ad-blockers, and operating in incognito modes are the most common ways to prevent third-party cookies from being able to track you. These strategies have all contributed to third-party cookies being a less-than-perfect method for marketers to track users’ website activity. Nonetheless, marketers have relied on third-party cookies for many years to better understand customer behavior around the web, use that knowledge to segment users into audiences, and send them personalized campaigns based on their being members of those audiences.
While third-party cookies themselves are fairly innocuous, a few high-profile scandals involving leaks of personal data2 have turned both the public and the government against them as a marketing resource. Over the last decade, customers have become increasingly concerned about their privacy and distrustful of third-party data collection. Additionally, many countries, states and regulatory authorities have passed laws regarding data protection (e.g., The EU’s General Data Protection Regulations (GDPR) and the California Consumer Privacy Act (CCPA)).
As a result of this increased pressure, Google, owner of the Chrome browser, announced in 2020 that it would eventually stop supporting third-party cookies within its browser. This was supposed to take effect in 2022 but has been pushed back to 2024.3
Other major browser companies had already blocked third-party cookies in their browsers (Safari, Firefox and Edge, respectively). But since Google Chrome is by far the most widely used browser (with a 65 percent market share), its decision to stop supporting third-party cookies brought the topic front and center.4
The elimination of third-party cookies means that organizations will need to think long-term about updating their technology and skills so they can better cultivate good first-party data, and also incorporate second-party data into their marketing strategy.
In addition to third-party cookies, marketers also rely on first- and second-party data:
First party data: First party data is the data a company collects itself. The data is created when customers make a purchase at a store or by visiting the company’s website. The website can collect analytics data, remember language settings, and perform other useful functions that help provide a cohesive customer experience. Without first-party cookies, users couldn’t log back into an ecommerce shop nor add items to their carts because all of their information would be forgotten with each new page load.
Second party data: This is data you get or can purchase if you sell items through, for example, a wholesaler, a retail store or e-commerce retailer that sells your product. Or you can get second party data from alliance vendors that you do business with.
Clearly, with the disappearance of third-party cookies, organizations will need to be more reliant on first- and second-party data.
Some companies already operating without cookies
Several companies already operate without using third-party cookies. For example:
It is crucial that organizations, especially marketing and product teams that deal with technologies stacks, begin thinking about moving away from traditional third-party cookies, which will soon be obsolete, to more effective targeting and tracking methods.
Parth Patel
Director, Marketing Consulting, KPMG Customer Advisory
Here are some steps your organization should consider taking to prepare for the elimination of third-party cookies.
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#1. Establish a dedicated MarTech team to deliver your strategy
In order to support the new cookie-less world, you’ll need to have the people, processes and technologies in place to meet the new demands. Consider assembling a cross-functional MarTech team that will be responsible for coming up with a MarTech strategy along with a budget to execute the strategy. This team should be composed of individuals with (1) a marketing background who bring a customer mindset, (2) marketing and enterprise technology experience, and (3) a finance background who understand the benefits and trade-offs of potential solutions.
We have found that dedicated MarTech teams are more effective than those composed of individuals with split responsibilities between the MarTech team and their positions with marketing, IT or finance. What’s more, the team should be responsible for managing the company’s MarTech stack as well as consulting with marketing teams and other parts of the business to develop and execute on the organization’s overall MarTech strategy.
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#2. Inventory your first party data
This might sound tedious, but it’s absolutely worth sitting down with a cross-functional team of key stakeholders (e.g., marketing, sales, IT, etc.) and quantifying a TRUE inventory of your first-party data. What we’ve found over the years is that organizations have relied on third-party cookies and, thus, third-party data, as the main resource for knowing their customers.
At the same time, they’ve too often treated their first-party data like the forgotten pasta in the back of their cupboard. It wasn’t because the first party data didn’t have any value; they were just defaulting to the easiest option.
Well, we’re now approaching the time when using third-party data is no longer an option and that the forgotten “pasta” is increasingly more valuable. In fact, the first-party data you possess is likely one of your most valuable company assets, and it’s worth investing time and resources to:
Your first step here is taking stock of all of your data and then noting where it lives within your organization. These are critical steps because we’ve seen companies overlook, discount or forget some of their valuable data simply because they haven’t considered it part of their marketing effort or marketing analytics data in the past.
Another challenge to inventorying and organizing data is that many companies have a siloed operating structure. This results in their data being stored and managed in disconnected departments throughout the organization. So knowing your data and knowing where your data sits are foundational steps toward building a strong first-party data structure within your company.
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#3. Establish trusted, validated second-party relationships
Once you’ve established a comprehensive and organized inventory of your first-party data resources, you should search for gaps in your first-party data and find trusted second-party partners to fill those gaps. This might require hiring a partnership data manager or bringing in a consulting firm that is familiar with the data broker industry and the tech needed to facilitate these data exchanges.
With the upcoming ban on the use of third-party data, marketers will need to establish closer relationships with wholesalers, retail stores or e-commerce retailers that sell their products in order to get second-party data transfers.
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#4. Consider a MarTech upgrade or swap
The transition away from third-party cookies also means that companies will need to modify or replace the technologies that use third- party cookies to enable their marketing strategies.
Thus, your next big step is to evaluate your MarTech stack and understand whether the tools you’ve built or invested in can support your transition to relying on first- and second-party data. Depending on how you stack up, it might be worth considering an upgrade or swap to a tech solution that specializes in first- and second party data management, such as a customer data platform (CDP).
CDPs help marketers build customer profiles based on first- and second-party data and provide them access to the right data needed to orchestrate real-time experiences. What’s more, CDPs help companies comply with privacy requirements and enable them to continue building trust with their customers.
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#5. Design a MarTech media buying strategy with measurement capabilities
Marketing and IT leaders must work together to ensure that IT teams include marketing priorities in their broader digital transformation projects. This collaboration enables the MarTech team to better understand all marketing objectives before developing its MarTech strategy, which should be designed to deliver seamless and relevant experiences across all channels. This teamwork will also help guide the organization in terms of investing in the appropriate emerging MarTech technology.
The overall strategy should include a:
In today's day and age, organizations don’t realize how complex and time consuming it can be to analyze and make changes to MarTech stacks. If you haven’t started thinking about and preparing for these changes to third-party cookies, it’s time to start taking action right now.
Ryan Doubet
Managing Director, Marketing Consulting, KPMG Customer Advisory
Even if Google opts to extend the use of third-party cookies a little while longer, it’s all but assured they soon will be gone. Organizations can’t stick their heads in the sand and pretend it won’t happen. This article has touched on some of the steps you may need to take now to prepare for this eventuality.
In addition to closer collaboration between marketing, IT and other key stakeholders, and mapping out a strategy for evolving their MarTech stacks, organizations will need to come up with different and better ways to cultivate first-party data and obtain useful second-party data from their business partners and vendors. And then they’ll have to acquire the technology or otherwise figure out ways to integrate first- and second-party data to make up for the loss of third-party cookies.
This can be a complex and time-consuming endeavor. Many organizations utilize KPMG Customer Advisory services based on our experience in these types of business transformations to help guide the process and provide recommendations on best practices and use cases. To learn more about the marketing transformation services we have to offer, click here.
KPMG Customer Advisory helps some of the world's leading marketing, sales, and service professionals make the right investments that deliver meaningful, sustained growth. At every step, we deliver insights that help you make decisions with precision and confidence. Together, we’ll turn opportunities into tangible, transformative results. Let’s start the conversation.
To learn more about how KPMG can help transform your marketing technology system and create a long-term MarTech strategy, reach out to one of our professionals listed below:
