The Cookieless Future - and how to tackle it

Hansel and Gretel can stay on, but their cookies will have to go next year

And the cookie crumbles – Brands need a new compass to navigate the cookieless future

SVP, Marketing & Customer Analytics | May 18, 2023

A quick 101 before we start: For those who are still wondering why there is no reference to Hansel, Gretel, Disney or chocolate chip cookies in the rest of this blog – these are not cookies that you eat but your computer does. Dubbed the magic cookie, HTTP cookie, a web cookie, an Internet cookie, or a browser cookie, this cookie is filled with information. Information about you, where you’ve been, your preferences, etc. Brands target these cookies to bet on where you would be next. So again, not Chips Ahoy! from Walmart.

So, earlier this year, the father, the son, and the holy spirit of our present-day digital lives, Google took a ‘proactive’ step to get on the right side of you, me, and the 5 billion others who use it or the 500 million who yell ‘hey google’ at a device every month.

Here is my attempt at translating Google’s move: “Hola people of the world, it’s time we stop taking you and your data for granted, so here goes – Before the politicians figure out what we do for a living and before we get called for another congressional hearing, we’ve decided to let go of a key carrier of your personal information – ‘the cookie’ – We did say we will put it to rest this year. But, since we’ve not figured out a way to live without it, we’ve decided to extend it to 2024.

What? No Tracking? In a way, yeah.

So, does this mean…

…out go those display ads that follow you so loyally to every nook and corner of the web, the text ads that think they are personalized and follow you into your Gmail Inbox, and the rest of the gamut?

Well, not quite.

This act on the cookies may be a step in the right direction as a good samaritan but they are not saints. With the smartphone being the single common denominator in the connected world, consumers thrive on hyper-personalization. Be it ads, promotions, or finding the right pair of ‘Nike Air Force 1s’ for the weekend, we live in an instant gratification world. So, no, we don’t expect them to be saints either.

As an alternative, Google is trialing a ‘less intrusive’ slightly more acceptable version of the cookie. It’s called Federated Learning of Cohorts. In perfect valley fashion, they’ve given it an acronym – FLoC. FLoC is supposed to run locally and analyzes your browsing behavior to group you into a cohort of like-minded people with similar interests (and doesn’t share your browsing history with Google). Don’t fret, your browsing history is still safe; just don’t forget to clear them once in a while if you visit questionable URLs though. That cohort is specific enough to allow advertisers to do their thing and show you relevant ads, but without being so specific as to allow marketers to identify you personally.

Here is another perspective: What do brands, conglomerates, governments, ethical hackers, and even your next-door neighbor have in common?

We are defined by our preferences and choices.

Answer: They know more about you than you think they do. So take a moment of pause as consumers and deal with that fact. On the other hand, data points such as your favorite laundry detergent, cosmetics, food, brands that meet your needs, and brands that meet your wants are those we anyways flaunt on social media for the world to judge. Our preferences and choices are what make us complete.

These data points form an integral part of the mobile-first, instant-gratification world we all live in. We are so used to something that we like a pop-up on our screen trying to nudge a purchase action from us.

When I browse for information, I still want it to be crisp, and I still want it to be tailored to my tastes. I don’t want to see what the Kardashians are up to on my 10 minutes browse of Flipboard on a Monday morning metro ride to work (or when I am working from home), no that would be for my weekends.

The answer is a tested and proven YES. It’s called First-party Direct-to-Customer Data Collection. Typically, brands use a way or two to collect this from the horse’s mouth – the customer. To start with, an agency conducts a survey. Or the same agency launches a bespoke interactive campaign built for this purpose and dangles an incentive at the end of the survey. Such activities require a lot of gray matter to come together, taking months to plan and weeks to launch. By the time it’s launched, the campaign or the data set required to collect loses strategic relevance – because, you know, we live in a world of the 8-second attention span and every 10th piece of information we consume is a video of a human or a cat that does something unbelievable.

You may wonder, ‘Hey, you said yes earlier and gave a discouraging and time-consuming solution to prove it. Is there a way to combat the cookie-less future?’

Sorry for driving you nuts with the last 100 words. Yes, there is a solution. Depending on how you wield it, it has the potential to become the sharpest tool in your B2C marketing arsenal. On the back of this solution, some of the largest global brands in the banking, telecom, insurance, and retail industry have collectively driven over 3,000,000,000 customer-brand interactions till date. For those who are still counting the zeros – it’s a billion.

Brands improve their CAC, drive in-app transactions, boost revenue per active user, and ultimately reduce churn by keeping customers coming back for more. All by transforming their digital customer engagement strategy with the help of concepts such as game theory, pleasure principle, and instant gratification that reward customers for their every action.

Collectively driving over $400M in incremental revenue, the solution of choice for 3 of the top banks, telcos, and even some of the well-established marketing agencies in Asia is the Perx autonomous loyalty and engagement platform.

The fusion of Perx and Open AI is the captivating recipe simmering in our product kitchen. With intelligent campaign recommendations, predictive rewards inventory management, and ChatGPT’s automatic idea generation, we’re propelling customer engagement and loyalty into an autonomous realm fueled by AI and data. Connect with us to find out how you can beat the cookie-less future by simply re-engaging your existing customers and engaging the new ones better.

In a nutshell, the decision by Google to phase out cookies has thrown the industry into a frenzy. While it may mean an end to the tracking that has become so ubiquitous, it also presents an opportunity for brands to rethink their customer engagement strategy, the percentage of marketing budget towards net-new customers vs existing customers, and their ROAS (Return On Ad Spend).

In today’s 8-second attention span world, brands can create a personalized customer experience, increase customer acquisition, and preserve privacy by focusing on building meaningful, long-lasting relationships with their customers. Rather than sustaining transient, transactional relationships, it’s time to foster deeper connections with the millions your business is serving.

The cookieless future brings unprecedented challenges to the entire brand servicing industry and not just B2C brands they serve. Agencies of all sizes are facing a daunting brick wall, hindering their ability to target the right audience, measure and attribute ad spend, manage ad inventory and pricing, and navigate privacy and compliance concerns. This leaves them in a perilous position.

To remain relevant in this changing landscape, the $592 billion global advertising industry must embrace a marketing technology stack that empowers first-party data collection. Additionally, agencies need to leverage innovative approaches such as gamification, AI, data, and analytics at a campaign level. By adopting these strategies, agencies can adapt to the cookieless era, ensuring their continued success in an evolving digital advertising ecosystem.

It’s time to seriously think about how to stay relevant in the cookieless future