The entire advertising industry is feeling the impact of Google’s announcement to remove third-party cookies from the Chrome browser by 2022. These measures are far from the first among the measures and restrictions taken to protect the privacy of users. The current situation has already been called the “cookie apocalypse” and “identification revolution”, but one way or another, marketing data platforms are entering an era of fundamental change.
What is the definition of first-party data?
Let’s discuss the many types of data organizations utilize in targeted ads before we get into what this move has implications for your paid ads for individual customers.
Companies acquire information on their clients from their own sources. That information is also familiar with first-party data. For instance, data from your website monitoring tool, email subscribers, or audience surveys.
When two or more organizations collaborate to share data, it means second-party data refers to it. One source collects third-party data, which is subsequently aggregated and sold to a third party with no ties to the original source.
● Data you acquire on your clients or site visitors refers to as first-party data.
● Data that you and someone else pool together is popular as second-party data.
● Data gathered by one party and sold or shared with an unconnected third party is known as third-party data.
What is the distinction between first-party and third-party data?
Data obtained from a third-party, or a site or entity that has no direct contact with the original source, refers to as third-party data, which Google is phasing out.
Data from third parties is gathered, aggregated, and sold to third parties. The issue is that the companies purchasing the data have no knowledge where it comes from.
There are also other concerns. You can buy third-party data, for example, but so can your competitors. This makes it difficult to compete..
This diagram depicts the differences between the various forms of data.
Many companies are phasing out cookies, including Google. In 2013, Firefox ceased utilizing cookies, and Microsoft made “Do Not Track” the default setting.
Cookies aren’t as accurate as people may believe, in addition to privacy concerns. They can’t always monitor people across devices, for example.
If you shop for shoes on your phone but purchase them on your laptop, you may still see adverts for those shoes on your phone, which is bad for ad spend because brands waste money targeting consumers who have already converted.
What Impact Will Using Third-Party Data Have on Ad Personalization?
Many brands will start using first-party data to better target advertisements as Google phases out third-party cookies. What does this signify for your pay-per-click campaign?
Don’t panic; you won’t have to start over with your marketing plan. There are a few changes, though, that you should be aware of:
● Brands must concentrate on gathering first-party data: Now is the moment to start collecting information about your target audience. To learn more about your audience, consider conducting contests, employing website tracking tools, or sending out surveys.
● Competitive analysis will become more difficult: One disadvantage of third-party data is that it allows you and your competitors to use the same targeting data. It is more difficult to comprehend why your competitors are doing the way they are now.
● Advertisements may get more personalized: Data from your actual site users and clients is popular as first-party data, and it helps you build a more tailored experience.
On a daily basis, the move away from third-party data is unlikely to have a significant influence on the marketing world. Most marketers will start to rely more on first-party data; however, Google is developing a “privacy sandbox” that will allow brands to target individuals without compromising their privacy.
Because there are numerous benefits to using this type of data, brands that want to flourish shouldn’t rely solely on Google’s new data package.
The Benefits of Using Only First-Party Data for Ad Personalization
Why should you switch to first-party data instead of depending only on Google’s privacy sandbox?
To begin with, most brands are relying more on first-party data, which indicates that they are getting great results. 87 percent of APAC firms consider it vital to their marketing efforts, according to Google.
Data from third parties is more accurate.
The information you acquire about your consumers reffers to as first-party data. Because you know who it’s about and where it originated from, it’s more accurate.
Third-party data is sold and resold, which means brands don’t have access to the original data and, in some cases, have no idea where the data comes from.
Boost Marketing Results
Some individuals are really concerned about the loss of third-party data, but I am not one of them. Why? Because first-party data is not only more accurate, but also more effective at motivating customers to act.
Marketers who employ first-party data experience a boost in marketing efficiency, generating nearly double the income from a single ad or placement, according to a Boston Consulting Group study.