Demise of third-party cookies amidst the growing importance of First-Party Data.

The crucial role of Data is no Secret. Every fraternity relies on data to excel, and the advertising industry is no different. In fact, it is critically dependent on data. And it worked out well for the longest time, despite there being concerning speculations over data privacy and the ethics of it. 

However, as Apple introduced the feature that allows its users to Block Apps from accessing iPhone users' data, the platforms that generate revenue through advertising, including tech giant Facebook, have caught themselves in a bind. And with these giants, everyone is dependent on them. Because without intricate information and specific targeting, ads aren't as effective and incur higher costs (way too higher). Imagine not having accurate details and shooting random ads in the dark that end up striking the wrong target audience.  

Facebook’s ad targeting became less accurate because it now knows less about its users. This means Facebook advertisers have to spend more money in the hope of reaching people on iPhones.  

Small businesses that rely entirely on online targeted marketing through Facebook and similar platforms to reach out to potential buyers have taken a massive hit. All because of Apple's one move, which is aimed at securing individual data and protecting their privacy, as it claims. The lack of market and consumer data, and the inability to predict consumer behavior makes it almost impossible to pinpoint the right set of audiences. The bigger picture isn't the consequences of Apple's move but the magnitude to which businesses are reliant on third-party data, which as per recent developments, doesn't seem like an ideal position to be in. 

For Businesses and Marketers, it's a nightmare they can't wake up and escape from.  

In one of the podcasts of the series What's Your Problem, hosted by Jacob Goldstein, A niche product owner shared his story that'll give you an insight into the extent of trouble small businesses are in.  

"The story of Ramon van Meer. He runs a company that sells ramps that help wiener dogs get up and down off the couch. For years, his company reached its niche audience through targeted Facebook ads. Then Apple changed the privacy settings on the iPhone, and suddenly those Facebook ads stopped working." 

And this is just one story of one small business, imagine the innumerable business owners who will be faced with a similar fate, if they haven't already.   

Apple has initiated a data-driven war that it's fighting on the grounds of ethics. In January CEO Tim Cook said at a public forum, “If a business is built on misleading users, on data exploitation, on choices that are no choices at all, then it does not deserve our praise—it deserves reform.”  

Now whether or not Apple's only intent is to protect users' privacy is a question that still lingers in the air. 

Either way, you do not want to be caught off-guard in the crossfire as the clash of the platforms gets worse. So, what is the alternative? A way out of the crippling dependency that can disable your business just as easily as it has enabled it. An escape from the grip of these platforms and their unpredictability? First Party Data. Yes. To gain independent ground, you need a self-reliant approach.  

In its 2022 global marketing trends study, Deloitte found that “61% of high-growth brands are shifting to a first-party data strategy, while only 40% of negative growth brands said the same.” 

 
Could this be a Blessing in Disguise for Businesses? An Eye Opener?  

There is a silver lining. It is a challenge now but it can be turned into an opportunity by leveraging a first-party data driven strategy. It's about time businesses take steps toward building up their own database. By managing data properly and implementing processes that ensure improved data accuracy, timeliness, and usability. It will allow marketers to build a distinct strategy, create ultra-personalized content, and advertising, and deliver an enhanced customer experience. Another boon would be that the data you collect would be rich in terms of exclusivity as opposed to shared third-party data.  

Create a Sustainable First-Party Data Strategy  

Build and strengthen your own channels, online and offline, and start collecting data from your clients directly and ethically. There are many sources you can collect first-party data including website or app behavior, email subscribers, lead generation campaigns, surveys, social media, customer feedback, online chat etc. It isn't an easy process and requires time, strategy, and consistency, but it is a way out of the tech giants for businesses that critically rely on them.  

At Hashbrown, we have been successfully building and executing First-Party Data Strategies for Our Clients for years. Want to Leverage our experience to build up and use first-party data to improve your approach to advertising, foster client relationships and increase ROI? 

Contact us now!