A colleague of mine, Tracy LeGault, once told me never to trust cookies that I couldn’t eat. I chuckled and laughed it off at the time, but today it seems she may have been on to something.
For as long as I can remember, we’ve been using cookies to understand consumer behavior better, track visitors to our website, and collect data for better targeting. We do this intending to create a better overall user experience, but things will soon change. Unless you have been living on an island trying to escape COVID-19 (which isn’t a bad strategy), you have undoubtedly heard the news that the death of third-party cookies is soon upon us. Being in the digital marketing space, as well as the host of The Layover Live podcast, I’ve heard more buzz around this topic of late than just about anything else.
If you’re like me, it has been a challenge to sift through all the noise and get to the bottom of how this may or may not affect DMOs. I mean, what the FLoC? (Sorry, I couldn’t resist a little tech humor!) Data privacy is serious business, and this change will affect each DMO differently, depending on its overall marketing strategy. This post is an attempt to simplify things for you, to educate you on this ever-developing topic, and to provide the insights you need to make informed decisions.
In August of 2019, Google announced a privacy sandbox proposal referred to as the Federated Learning of Cohorts (FLoC...now you get my joke?). FLoC was created as a set of open standards with the goal of fundamentally enhancing privacy on the web by developing an open-source way to make the web more private and secure for all users. We’ve recently seen others like Apple do the same thing with their iOS 14 update, so privacy is certainly in the air.
Google recently published a blog post reaffirming its confidence that privacy-preserving APIs like those being developed in the Privacy Sandbox (testing ground) would be how its ads and measurement products work on the web in the future. It also clarified that once third-party cookies are phased out, which is planned for early 2022, Google will not build alternate identifiers to track individuals browsing the web, nor will it use them in its products.
Wait—what happened to playing nice in the Privacy Sandbox?
With this announcement, Google has dashed the hopes of many in the advertising industry who had hoped for an alternative universal identifier such as hashed emails.
What Does This Mean for Destination Marketers?
One of the questions we commonly get is how these data collection changes will affect a destination’s marketing efforts. The good news is that these privacy and data collection changes primarily affect network advertising vendors and exchanges (including Facebook and Google). Destination marketers should be aware that these changes may alter the effectiveness of some of the targeting methods they have used in the past. We recommend consulting your data and advertising providers directly to discuss, as many are already working on solutions such as Unified ID 2.0. Jeff Green, CEO of The Trade Desk, recently stated:
“Cookies are going away after all. Nothing new there. You already knew that. And, of course, cookies only impact the browsing internet. That’s about 20% of data-driven ads today. 20% is meaningful, but the open Internet has already created an alternative to third-party cookies -- Unified ID 2.0.”
Since remarketing primarily relies on third-party cookies and browsers will stop supporting them, we do expect change on advertising platforms. To address those concerns, Google is working on a few projects, including FLEDGE and TURTLEDOVE, both of which allow for an advertiser or publisher to more securely leverage first-party data, such as previous site visitors, to inform ads that a consumer may see. Other proposals are being tested as well, and there will be more to come on this topic as the year progresses.
The design for some of the functions, such as FLoC, is still in the early stages. We’ll be keeping an eye closely on the changing landscape.
Some advice worth passing along includes:
- Develop a customer data strategy by leveraging first-party data where it’s most impactful, both on Google properties (e.g., Customer Match) and with other publishers where advertisers have direct relationships. Invest in first-party data through email sign-ups, tracking web analytics, CRM data, and more.
- Leverage advertising automation and machine learning tools to build on your insights and drive performance measurement (e.g., automated targeting, smart-bidding, conversion modeling) for today’s reality and the continually changing landscape.
- Monitor ad performance based on the changes to audience data collection. You may see changes to how your ads perform, with some targeting methods potentially being sunsetted. In the case of Google, it plans to make FLoC available for testing in Google Ads later this year.
- Continue to keep an eye on the industry dialogue concerning privacy-preserving ways. Google and other companies will support key advertising and measurement use cases as they continually work with others in the industry on the path forward
It’s worth noting that there is no change or impact to any existing Google product today. Chrome (and Google’s other ad products) will continue to support third-party cookies until solutions from the Privacy Sandbox meet the needs of users, publishers, advertisers, and their own ads. Ultimately, unless you’re a DMO that has been relying heavily on third-party cookies or individual data to target your audiences, there is likely no need for panic. However, this recent announcement will have implications on the evolution of certain products after third-party cookies are phased out.
Destination Marketers can continue to achieve their performance goals in the following ways:
- Using tools like Google Global Site Tag, Google Analytics 4 and Facebook Pixel can help future proof your tracking and performance analytics capabilities.
- Grow your CRM database now by collecting emails to target your customers directly and build relationships over time using first-party data.
- Adopt machine learning technologies that build on your insights. Expand on them to drive results in a changing ecosystem: automated targeting, smart bidding, and fully automated campaigns are just a few. Google’s FLoC appears to provide a level of privacy to each individual user while allowing advertisers to continue serving targeted and relevant ads that also keep the user's browsing private.
- Remarketing in Google’s ecosystem is expected to remain relatively unaffected. That said, remarketing across other platforms and channels appears to still be up in the air. As more information becomes available, we will continue to provide strategic advice.
- Attribution data across channels will be more challenging, especially for those who rely heavily on programmatic ads. Plan accordingly.
- Contextual targeting and direct publisher buys may be old-school tactics but will remain a great way to reach potential travelers at key moments of inspiration and planning.
- For Agencies / Partners invested in other identity solutions: Although Google will not be integrating solutions for use cases that involve user tracking across the web, it is planning to support cohort-based targeting (e.g., FLoC IDs) in Display & Video 360, Google Ads, and other products where marketers and agencies may reach privacy-safe cohorts of users they identify as high value using their own data signals. Google also intends to continue supporting the use of programmatic direct deals negotiated and curated directly between advertisers and publishers to reach users based on publisher signals.
Our team looks forward to working with you as this complex ecosystem evolves. For now, marketers should stay up to date with the news and be in regular contact with their paid media and data providers. In addition, marketers should check out Google's Marketers Privacy Playbook for some best practices.