As third-party cookies are phased out, marketers are being forced to reassess their digital marketing strategies.

First-party data is the answer to third-party cookies. But how should digital marketers re-strategise?

In this Q&A, Mike Falconer, Vice President, Fan Engagement Strategy, Sportradar, gives insights on how companies can thrive in a post-cookie world.

Can you briefly discuss the impacts of phasing out third-party cookies when it comes to digital marketing?

Equally, the insights they provide underpin programmatic marketing technology, which allows customers to be targeted with relevant ads based on their digital activities. Last year, global programmatic advertising spend surpassed $290 billion, highlighting both the industry’s reliance on third-party cookies and the size of the potential disruption.

FireFox and Safari no longer use third-party cookies and this year Google has already removed over 1% of third-party cookies from Chrome, so marketers must explore alternatives. The need to innovate is no

In light of this phase-out, how are companies adjusting their strategies?

Falconer: The reaction to this news has been mixed. For some, it has created apprehension, with a recent Adobe study suggesting that over 75% of marketers expect the end of third-party cookies to hurt their business.

While many organizations have been hesitant to adjust their strategies, Chrome is the world’s largest browser with over 80% of the web so many are now feeling the urgency.

First-party data is the most viable alternative to third-party cookies as it provides more targeted personalization, maximizes engagement, and increases customer lifetime value. It also does not have the same privacy concerns as third-party cookies, which are being removed partially due to increased regulations around protecting individuals’ personal data.

This development therefore should be welcomed as an exciting and unique moment in time to enhance our industry.

How can first-party data replace third-party data when it comes to personalized digital marketing, and how can it increase revenue and reduce costs?

Falconer: First-party data is collected directly and consensually from customers, either through engaging with websites or marketing, making a purchase, or filling out a poll. Not only does this ensure privacy compliance but it means the data collected is more specific and reliable than what can be obtained through a third-party cookie.

It is the higher quality of this data that optimizes personalization and marketing performance. Studies demonstrate that a direct correlation exists between personalization and monetization for online direct-to-consumer brands and first-party data marketing initiatives can nearly triple revenue and almost double cost reductions.

Customer willingness to share their data for personalized experiences is also increasing, with 91% of customers more likely to shop with brands providing relevant ad recommendations.

First-party data provides customers with the experiences that they want, which in turn delivers increased revenue, loyalty, and reduced advertising waste for marketers.

What is the importance of data collaboration, when it comes to personalized digital experiences in a post-third-party cookie world?  

Falconer: First-party data collaboration is essential to not only deliver personalization but also to ensure compliance. The most feasible way of facilitating this collaboration is through anonymized first-party datasets within secure digital depositories called data clean rooms.

At Sportradar, we have developed the first data clean room specifically for the sports industry for our rightsholder clients and their sponsors to enhance customer understanding and achieve greater targeting and personalization.  

Anonymized data is connected and analyzed within the data clean room and allows more informed customer profiles to be developed, which establish deeper insights around individual interests and purchase intent.

It’s also important to ensure participants can stipulate which partners they want to share their data with, and that complete sovereignty and custodianship is provided at all times.

What trends do you see in the Asia Pacific (APAC) region, now that third-party cookies are being phased out? 

Falconer: Like the rest of the world, many businesses in APAC understand the reality that third-party cookies aren’t a long-term solution and they must invest in first-party data technology.

However, this transition is especially important in APAC because of the lack of uniformity in its data privacy laws, when compared to somewhere like Europe with GDPR.
For example, India launched its Digital Personal Data Protection Act last year, whilst China and South Korea have some of the strictest data privacy laws in the world.

This variation in data legislation is something organizations must be able to navigate if they are to successfully operate across the whole region.

Data clean room solutions that rely on technologies like confidential computing, such as Sportradar FanID, are therefore essential to ensure that first-party data use remains privacy secure, protected and anonymized at all times.

For example, India launched its Digital Personal Data Protection Act last year, whilst China and South Korea have some of the strictest data privacy laws in the world.

This variation in data legislation is something organizations must be able to navigate if they are to successfully operate across the whole region.

Data clean room solutions that rely on technologies like confidential computing, such as Sportradar FanID, are therefore essential to ensure that first-party data use remains privacy secure, protected and anonymized at all times.

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