As the digital marketing industry grapples with the imminent phase-out of third-party cookies by Google in 2024, companies are faced with the challenge of delivering personalized and relevant customer experiences in a cookieless world. In this article, we explore the next chapter of personalization, and how customer data platforms like Twilio Segment can help.
As digital marketers, we're no strangers to change. The digital landscape is constantly evolving, and it's part of our job description to stay on top of new trends and technologies. But perhaps no shift has been as significant as the impending phase-out of third-party cookies.
Third-party cookies have been a cornerstone of digital marketing for years, tracking users’ web activity across multiple websites, providing valuable insights into customer behavior and preferences and helping to make targeted advertisements more relevant. But as the world becomes more privacy-conscious, third-party cookies will soon join floppy disc drives and dial-up internet in the Great Technology Junkyard. Browsers like Google Chrome, Safari, and Firefox are phasing out support for third-party cookies, and regulations like the Australia Privacy Act and GDPR are placing restrictions on how customer data can be collected and used.
This shift has left many marketers wondering how they'll continue to collect data and provide the personalized experiences that our customers expect. The missing ingredient can be found in Customer Data Platforms (CDPs) like Twilio Segment.
CDPs enable companies to collect and organize first-party data, such as website analytics, purchase history, and CRM data. By collecting data from multiple sources and linking it to individual customer profiles, CDPs make clear customer identity and clean data possible in a complex, multi-channel environment. This includes all the dark data — the unstructured, difficult-to-analyze data — you have captured in your operational silos and technology solutions such as ERP, CRM, and e-commerce solutions, and use this to better understand your customers.
But collecting and organizing data is just one piece of the puzzle. The key lies in how you leverage this data to deliver an exceptional experience for each unique customer. This means tailoring your approach to each customer's specific needs and preferences, going beyond surface-level personalization.
Individualization is about treating customers as unique individuals, rather than just part of a larger group. It's about providing a tailor-made experience that makes customers feel seen and heard.
Here are some best practices for achieving individualization at scale in a cookieless world:
Focus on zero- and first-party data
Zero-party data is data that customers knowingly provide, such as survey responses, feedback, and preferences. This data is essential for building trust with customers and providing individualized experiences. First-party data, which is behavioral data actively collected from your website and other owned channels, is another reliable and accurate source of information. By basing your strategy on first-party data now, you'll be at an advantage when the third-party cookie D-Day arrives.
For example, let's say you run an e-commerce store that sells outdoor gear. You could create a survey that asks customers about their favorite outdoor activities, the types of gear they're interested in, and their budget. By collecting this zero-party data, you can build a profile of each customer's interests and preferences. You can then use this data to provide personalized recommendations, such as sending an email with recommended gear for their favorite outdoor activity.
Rethink your attribution model
In a cookieless future, multi-touch attribution models that rely on third-party cookies will no longer be effective. Consider switching to server-side tracking to be less reliant on third parties like Google. This will give you more control over your data, allow you to track customer behavior reliably, and ensure that you don't miss out on any critical data.
Let's say you run a software company that offers a free trial of your product. Instead of tracking clicks and conversions with third-party cookies, you could use server-side tracking to monitor user behavior within the product. By tracking which features are being used and how frequently, you can get a better sense of each user's needs and interests. This data can then be used to provide individualized follow-up emails or targeted ads.
Expand your data warehouses into customer engagement
Cloud warehouses are on the rise, but without a CDP, non-technical teams are forced to rely on data engineering teams to access and use the data. This defeats the purpose of having a cloud warehouse in the first place. By using a CDP like Twilio Segment, you can expand your data warehouse into customer engagement and make your data accessible to all the business-critical teams and tools you rely on.
Imagine you run a B2B SaaS company (actually, you probably do). You could use Twilio Segment's Profiles Sync and Reverse ETL features to sync valuable customer profiles stored in your data warehouse to other tools like your email marketing platform or your CRM. This would give your marketing and sales teams access to up-to-date customer data, allowing them to provide personalized experiences across all channels.
Use omnichannel customer identity resolution
In a cookieless world, identifying customers across different devices and platforms becomes more challenging. This is where omnichannel customer identity resolution comes into play. By using a CDP like Twilio Segment, you can identify customers across all channels and devices, even if they're not logged in or using the same email address.
For instance, a customer browses your website on their phone and adds a product to their cart. They then switch to their laptop to complete the purchase. With omnichannel customer identity resolution, you can link these two actions to the same customer profile, even if they're using different devices and not logged in.
Build trust and transparency with customers
As we mentioned earlier, building trust with customers is essential in a cookieless world. Customers are becoming increasingly privacy-conscious and wary of companies that mishandle their data. To build trust, be transparent about how you collect and use customer data and demonstrate the value you can provide with that data.
For example, let's say you run a healthcare company that collects patient data. You could be transparent about how you collect and use that data, ensuring that patients understand how their data will be used and why it's important. This strategy will also help you stay in line with the Australian Privacy Principles (part of the Privacy Act), or APP, which indicate that organizations collecting personal information must comply with privacy notification requirements. You could also provide personalized recommendations and resources based on that data, such as sending a reminder to schedule a check-up or providing resources for managing a specific condition.
Quoting the inimitable Seth Godin, “…when someone chooses to pay attention they are actually paying you with something precious. And there’s no way they can get their attention back if they change their mind. Attention becomes an important asset, something to be valued, not wasted.”
The Twilio Segment advantage: Profiles Sync and Reverse ETL
Twilio Segment's customer data platform offers a range of features that enable companies to deliver personalized and relevant customer experiences in a cookieless world. Two of these features, Profiles Sync and Reverse ETL, enable our customers to sync rich profiles and other valuable data stored in their data warehouses to all of the business-critical tools they rely on to engage customers and personalize experiences.
Profiles Sync makes Twilio Segment's identity-resolved customer profiles portable, syncing customer profiles to the data warehouse, giving data teams the foundation they need to create valuable audiences in the data warehouse that power personalized customer experiences.
Reverse ETL makes activating these enriched profiles, and other valuable data stored in the data warehouse, easy and automatic. You can connect to and start syncing data from your cloud data warehouse of choice within minutes.
Twilio Segment's impact on sustainable growth
Twilio Segment's customer data platform has been instrumental in helping companies achieve sustainable growth through personalized experiences.
Tess Mercer, VP of Digital at Box, said, "With third-party cookies going away, it's very important for us to have our first-party data centralized in one location because that means that we have control of the data and the people who we want to actually reach. Twilio Segment is helping Box reach sustainable growth through its impact on our cost to acquire new contacts (CaC). We have seen a 70% decrease in CaC by using our own first-party data in paid media."
The phase-out of third-party cookies presents both a challenge and an opportunity for digital marketers. By focusing on individualisation and following the best practices outlined above, you can continue to provide exceptional experiences in a cookieless world. As always, it's important to stay adaptable and continue to experiment with new strategies and technologies to stay ahead of the curve. Learn more about customer data platforms at www.segment.com and see why 25,000+ customers use Twilio Segment's CDP to collect, clean, and control customer data at scale.
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