What Does the Loss of Third-Party Cookies Mean for Financial Institutions

Over the last 25 years, financial marketers have relied on third-party cookies to fuel digital marketing campaigns. Tracking consumers from website to website across the web, third-party cookies inform marketing strategies, allowing financial institutions to create highly personalised ads based on user patterns and behaviour. For example, third-party cookies have enabled banks and building societies to send tailored offers around mortgages to first-time buyers based on searches on online estate agents such as PurpleBricks and Rightmove.

However, this is all now set to change. Growing concerns over the impact of third-party cookies on user privacy have led to increased crackdowns on their use. Apple launched its Intelligent Tracking Prevention (ITP) in 2017, Firefox launched its Enhanced Tracking Protection (ETP) in September 2019 and with Google announcing it will phase out cookies on its Chrome browser by 2022 earlier this year, the writing is on the wall for third-party cookies. With nearly half the market share of web browser usage, Chrome’s change means the way the internet works has fundamentally changed too.

The impact on marketing campaigns

The death of the cookie is a fundamental change in online media and the future is uncertain for finance marketers who depend on third-party data for their advertising channels.

Finance marketers currently use third-party cookies for measurement, attribution and, of course, personalisation. These are all impacted by the loss of the cookie. For instance, looking at personalisation in a cookieless world, tailoring messages to customers becomes increasingly difficult. Data is limited to walled gardens and first-party information such as purchases, name and location. As customers have come to expect personalised content as the baseline in most communication, the loss of third-party cookies could put financial institutions at a disadvantage, and make it harder to send the most relevant promotions to the right customer. However, if banks and financial institutions start preparing now, it does not have to mean the end for highly targeted marketing and advertising.

Building transparency

As the Google update won’t fully roll out for another two years, the industry has time to figure out how it will handle a cookie-less future. While Google’s Privacy Sandbox aims to replace cookies with five Application Programming Interfaces (APIs), there is a better alternative for finance marketers.

Based on data integrity and accuracy, data co-ops like ADARA provide financial marketers with the ability to personalise marketing messages while maintaining high levels of transparency – crucial particularly for regulated industries. Cookie usage is far too opaque for the clarity needed around privacy issues. It is clear that financial marketers need to find and leverage more ethical customer data or more responsibly sourced data – like what is found in a data co-op.

Data co-ops ensure transparency as partners are only allowed to enter into the cooperative if they adhere to a number of rules. These rules ensure that customers know that their data is shared for marketing purposes, among other things.

Growing concerns over the impact of third-party cookies on user privacy have led to increased crackdowns on their use.

Using that data to build identities

Data alone isn’t enough, however. It is the relationships between data that build a truly valuable picture of the consumer that finance marketers can then use to target effectively. This is the essential step in moving from a cookie-based world, to an identity-driven one.

Building identities takes a series of data points and layers them on top of first-party data. We are able to then link these back to a single profile – using persistent identifiers (such as email addresses) to ensure that there are groups of real people whose profiles we understand well. We call this the identity graph, and it allows us to use both digital and offline channels to reach relevant customers.

Every business and industry currently has varying methodologies for building, storing and trading identity. These are new technologies to help marketers understand customers and target them effectively while upholding the absolute highest standard in terms of data ethics and enshrining the privacy of the customer at the heart of the process.

In the long run, this is actually a better system than the temperamental third-party cookie: it means finance brands can be sure they are marketing to a real individual and that marketers can pull together disparate information on an individual with more confidence – including historical data. Persistent data does not expire, as a cookie does. It also allows brands to leverage people-based marketing channels like Facebook and YouTube cohesively as part of a wider strategy.

ADARA has a 600 million-strong identity graph of customers, built from first-party data from over 270 partners.  As a result, we can produce 5,000 distinct segments. From this, financial clients are able to mix and match the data sets they need for their target customer group.

Credit card lenders, for example, can use ADARA’s identity graph to personalise advertising efforts and thereby incentivise potential customers. Finance marketers can offer a new card with a certain reward to those most likely to be interested – whether that be cashback, air miles or loyalty points. For instance, if real estate data tells us a person is moving, a finance brand could offer a specific reward that relates to ‘new home’ costs. If traveller data tells us that an individual is a frequent international flyer, offering a card that waives foreign transaction fees could be a hugely compelling incentive to that person. For investment and wealth management services, an identity graph could help identify customers undergoing life changes such as getting married or starting a family – key times to make big financial decisions.

Even though the final nail in the coffin of the cookie is two years out, it’s clear that financial institutions need to prepare for the change now. If finance marketers don’t start laying out the groundwork now then they will lose out to competitors who are using identity graphs in order to send tailored marketing messages that drive sales and put them top of mind for customers.

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