While the demise of the 3rd party cookies is knocking on the door, marketers are exploring new options for optimizing targeting and segmentation methods, profiling consumer behaviour and investing in a much better customer experience. The inevitable answer seems to lie in a combination of new and old methods, employed in an orchestrated way: a.k.a Customer loyalty as a 1st party data collection, enrichment & activation method!
3rd party cookies have been a targeting and segmentation identifier for brand marketers for a very long time. Using “other people’s data” was an easy, well-accepted and a proven methodology to reach out to new leads, follow up on existing prospects and customers. Unfortunately, not anymore…
As we have pointed out in Labrys Modern Marketing 2.0 Framework, savvy marketers need to start working on “Big Data for Advertising & Marketing”. Brands should start building up their own data, targeting and omnichannel experience strategies from scratch. Audience targeting must start with the advertisers’ first party data, and not with “other peoples’ data”.
A new approach to customer loyalty
As a driver of this strategy, modern and connected loyalty, and sales promotion methods and technologies, will provide an important kick start for these efforts. It is important to note that long-gone are the days of complex and expensive loyalty software that may require complicated infrastructures as well as dedicated marketing personnel.
Modern customer loyalty approach provides agile solutions, both online and offline – i.e. by connecting the divide between e-commerce sites & apps with physical points of sales. This is true for both data collection and redemption activities. This new approach would definitely open up new avenues to strategize and collect all available data and be able to segment, bond and form a long-term relationship with customers. It will also allow marketers to activate these functionalities to orchestrate an omnichannel customer experience. Insight driven from first party data sources would be used to increase efficiency in advertising targeting and segmentation efforts, as well as provide priceless input for a true customer 360 dataset.
The importance of personalization
According to “The Loyalty Report, State of Loyalty, 2020”, 64% of consumers modify their spend amounts as a result of relevant offers. What’s more, the overall experience accounts for 76% of what drives engagements, leading into the conclusion that a true omnichannel experience has a high probability to drive engagement between brand and consumer. Another important aspect would be the effect of personalization in orchestrating omnichannel experiences, which includes advertising and point of sales transactions. The same study found that loyalty programs achieving high levels of personalization along the member lifecycle experience, delivered higher spend by 6.4 times and that offers tailored on member behaviours and needs, receive 8 times more positive response. They also steer members away from their initial preference and towards these personalized offers.
According to McKinsey’s “The big reset: Data-driven marketing in the next normal” report, “Between March and August 2020, one in five consumers switched brands, and seven in ten tried new digital shopping channels. The retail sector experienced ten years of growth in digital penetration in a matter of months.” With all these facts in place, brands are now under huge pressure to provide immediate seamless digital experiences for their customers. Therefore, it is of the utmost importance to create a “trusted data relationship” between brands and customers and to channel this relationship into more personalized experiences with an omnichannel approach. Hence, loyalty and personalized sales promotion programs would become a very important data source, activation platform and a milestone for achieving a true omnichannel experience for customers.
What the future holds
Therefore, a cookieless world is clearly not the end of advertising as we know it! But it is the beginning of a new era for marketers to tap into new skillsets and to benefit from new generation AdTech & MarTech. Gathering insights from first party data sources, like loyalty and sales promotion programs, and using these insights in creating better advertising and customer service experiences as well as providing more and more personalized offers, would enable marketers to maximize ROI.