The death of third party data

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With GDPR in full force, the days of third party data are numbered

The regulation has been the catalyst for new concerns around how companies are using our personal information, and there is heightened awareness around how anonymous third-party data cookies are tracking us around the internet. In a post-GDPR world, sensitivity to intrusive online ads has never been so strong.

And it’s a justified cause for concern. Imagine going into H&M and someone walking up to you to sell a Primark T-shirt. It wouldn’t feel right, but that’s exactly what ad space is doing. You could be on a travel website and another completely different company, with no affiliation, not only knows that you’ve been there but that you’ve made a purchase.

This abuse of third party data has become the norm, with too many companies crossing the line and violating consumer’s privacy. And let’s not forget, this practice has been technically possible and legally allowed. What Facebook and Cambridge Analytica did, for example, didn’t break the law. They abused something they were allowed to abuse. But consumers have become savvier when it comes to their data and they rightly called ethics into question.

In this climate, marketers need to be prepared for a backlash on a much wider scale, and for the spotlight on ethics to kill acquisition marketing. Data Management Platforms (DMPs), which currently allow marketers to access huge volumes of third-party data way beyond the resources of the individual marketer, will become a thing of the past. Or marketers will at least have to accept that there will be radical changes or limitations for these platforms to function within GDPR regulations.

Putting retention marketing centre stage

This will put significant pressure on CMOs to shift their focus to providing the best possible experience to existing customers, targeting known email addresses and mobile numbers instead of using cookie crumbs. The beauty of retention marketing is that the brand has already won the customer over at some point in the past, so they are likely to be more receptive to personalised content and engagements.

Forrester research shows that the majority are already onto this trend. In 2017, CMO spend on customer growth and retention outpaced budgets for customer acquisition by an almost 2:1 ratio (63% and 37% share of budgets, respectively). That’s good progress when we consider that ten years ago the use of third party data dominated. But there’s still a long way to go and marketers should be working to get their acquisition budgets right down to meet customer expectations.

Turning first party data into a gold mine

The next challenge for marketers is to maximise spend on retention marketing and make first party data a powerful addition to their omnichannel strategy. For example, as customers voluntarily follow a brand’s social channel, it makes sense to tap into this as much as possible. Retention marketers have the opportunity here to transform communication and capitalise on tighter customer relationships across the digital journey.

In addition, CRM-based advertising enables marketers to use their first-party contact data to reach anyone online, wherever they are, with relevant ads. Marketers can extend their reach across networks without diluting targeting focus, and can drive engagement to provide comprehensive, exciting customer journeys. The critical aspect here becomes the marketer’s ability to accurately match first-party data with network profiles to target users on networks such as Google and Facebook.

However, what will ultimately drive revenue is automating the integration of first-party data. Marketing automation needs to take a strategic approach in order to be successful, as poorly implemented automation can very quickly ruin personalisation.

In a post GDPR world where consumers expect – and deserve – a more responsible use of their data, the key to success is building personalised customer journeys that inspire customers to keep engaging with the brand. By combining first-party data with sophisticated marketing platforms, and being aware of the changing digital habits of consumers, marketers now have all the ingredients they need to seriously transform their online strategy and win at retention marketing.


About the Author

The death of third party data TechNativeGrant is Vice President and Market Director at Emarsys. In his role, Grant is responsible for operations in the UK as well as supporting clients in the Nordics, Middle East and Africa. Grant has a wealth of experience in ecommerce and digital marketing, consistently delivering high quality support for clients across the end-to-end customer journey.

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