If you want to stay privacy-conscious and respectful of your customers, you have to champion transparency, which creates trust. It’s critical that marketing teams begin prioritizing first-party data as a long-term customer strategy for targeting — and personalizing — their advertising.
Marketers started planning for this change years ago, and they have continued adjusting their approaches to align with data privacy regulations. It’s a balancing act but one likely to pay off for those brands able to find meaningful, intentional ways to treat people as individuals while also delivering a mutually beneficial, tailored experience.
Buyers across all industries expect fully personalized, self-directed experiences. Achieving this goal requires zero- and first-party data plus qualitative insights derived from channels — like email — that successfully convert leads.
I spoke recently with Litmus senior vice-president of marketing Cynthia Price about the current challenges marketers face with prioritizing personalization and data capture as new privacy measures take effect.
Gary Drenik: How will marketing change with the eventual loss of third-party cookies and other data privacy measures?
Cynthia Price: In The Dark Knight Rises, Bane was “born in and molded by the dark,” whereas Batman “merely adopted the dark.” Successful marketers born in the dark (a world of zero- and first-party data) have not just adapted to today’s changing privacy landscape — they have thrived. Because they have always used these data and optimized structures, they are not scrambling to adapt in the wake of privacy changes.
Meanwhile, marketers who embraced “bad” or siloed data as an ally merely lost trust among their customers. Now they find themselves racing to adopt new personalization trends meant to mitigate privacy changes, such as Apple Mail Privacy Protection or the loss of third-party cookies.
An Epsilon survey found that about 80% of marketers depend on third-party cookies. When they do disappear in 2023, key components of digital marketing will face serious disruption. A/B testing and frequency capping could become more challenging. With analytics and attribution based on third-party cookies, performance marketing could become less effective. Marketers dependent on third-party cookies to collect behavioral and browsing data could struggle to personalize outreach.
Regardless of generation, consumers don’t like when social media sites, search engines and mobile apps collect personal, online, and mobile location data, allowing access to marketers who use it for targeted advertising campaigns. According to a recent Prosper Insights & Analytics survey, nearly 52% of Gen-Z, 49% of Millennials, almost 63% of Gen-Xers, and over 78% of Baby Boomers don’t approve of personal data collection without their permission.
Prosper – Advertisers Who Access Your Personal Data
Drenik: What should marketers be doing to start creating more personalized experiences for customers?
Price: According to our 2021 State of Email report, 71% of consumers expressed frustration with impersonal experiences, but 42% of marketers cited a lack of resources, including time, people, and money, as barriers to achieving personalization goals.
Marketers need a more transparent approach to collecting the information required to deliver personalized experiences consumers expect. By encouraging website visitors to authenticate and consent to specific data collection, marketers create trust between brands and consumers.
Readily available data — demographic, firmographic, behavioral, or contextual data, for example — can inform personalization strategies, including sending emails.
Email is one of the most effective channels for personalization, starting with a tailored subject line. Use the data in your CRM to personalize by adding someone’s name, incorporating timed content to drive a sense of urgency, or adding an image or call to action (CTA). You can also suggest content or products similar to what you know customers like based on what they have purchased or engaged with in the past, too.
Drenik: Does this newfound focus on data privacy have a larger impact on B2B or B2C marketing? And why?
Price: This focus on data privacy has impacted both B2B and B2C marketing. Customer-centric data privacy policies — like the General Data Protection Regulation — apply to both markets.
The companies leveraging third-party data across multiple websites, like digital identities collected by third parties, cross-platform ad targeting, and reporting and attribution, will see the most significant impact.
Data privacy regulations give more control over their data to the users. Customers decide where, when and in what capacity to share their information. Businesses establishing trust are more likely to gain the information they seek from current and potential customers.
There is a similarity between personal and enterprise data. We expect B2B organizations to handle enterprise data responsibly, just as we expect B2C companies to be responsible stewards of personal data. But because of enterprise data ecosystems’ complexity and storage of personal information, customers remain leery about sharing information. The same Prosper Insights & Analytics survey, found that an average of 40% of people have turned on private browsing, 32% have turned off mobile trackers, and over 47% of people have denied permission for mobile apps to track them.
Prosper – Protecting Digital & Online Privacy
With data privacy, consent remains the most crucial line of defense. Companies should tell their customers what data they want to collect and how they will use it. Transparency is the foundation of building trust. Greater trust leads to higher brand value. Because of its heterogeneous nature, enterprise data requires more aggregation, analysis, and processing than B2C data. While the impact permeates both, B2B organizations have more legwork and must think creatively about what data to collect and how.
Drenik: What are some of the biggest challenges marketers face when trying to collect and leverage zero- and first-party data?
Price: Merkle’s 2021 Customer Engagement Report found more than 50% of marketers use digital experiences and strategies to collect first-party data. But they do face challenges.
Third-party cookies offer a limitless scale that can collect significant amounts of data but sacrifice at least some accuracy. While first-party data is more limited in scale, transactional data or double opt-ins verify it at the source. However, marketers cannot target more customers than those from whom they have already collected information, limiting both scale and reach.
Marketers aren’t working with an even playing field when attempting to collect first-party data. For some organizations, capturing information is relatively straightforward. Companies might collect data via authenticated logins, subscription information or website analytics.
But those on the buy-side, like advertisers, may find it more challenging to gather consent-granted data. Some companies, because they don’t directly engage with their consumers or employ their own ecommerce channels, may struggle to collect first-party data for use in their marketing campaigns.
It is also challenging to store and aggregate first-party data from multiple sources, whether from data collected offline from in-store purchases, website visits or email opens. Businesses can ameliorate this situation by consolidating data into a single silo, facilitating access to the data to inform marketers’ campaigns.
Drenik: How has email, specifically, been impacted by Apple Mail Privacy Protection? Should marketers still view it as a critical component of a marketing program?
Price: Apple launched its Mail Privacy Protection (MPP) initiative in September 2021 to hide receivers’ IP addresses, prevent senders from identifying locations or linking to other online activities, and keep senders from seeing if and when they have opened their email.
For companies relying on open rates as a measure of email performance, MPP raised concerns about marketers’ ability to accurately measure email marketing campaigns’ success. However, email marketing metrics hold little value unless they are tied to specific business goals. Otherwise, those open rates are just a vanity metric.
Has MPP affected email marketing? Yes — but not necessarily negatively. If anything, marketers must understand email’s contribution to each sector and shift their focus away from tracking click rates, click-to-open rates, and isolated open rates, which can hinder strategic opportunities.
Email absolutely has a place in marketing programs. When integrated appropriately, email yields a wealth of valuable metrics for marketers to optimize campaigns, tailoring content, and customer touchpoints throughout the journey.
Other email marketing tools and approaches include using filtering for reporting to help exclude MPP opens and instead rely on “real opens” which more accurately measure overall email engagement. For example, real-time personalization tools can include collecting a subscriber zip code in lieu of an IP address. To measure engagement, AI platforms are shifting to evaluate and analyze a host of hybrid performance metrics, like clicks, opens, and conversions.
Drenik: Thanks, Cynthia, for taking the time. It will be interesting to see how marketing changes in both the B2B and B2C spaces due to privacy changes and an increase in the usage of zero- and first-party data.