By Jon Stamell, CEO of Oomiji
If there’s one lesson we all should have internalized during two years of pandemic-related disruption, it’s that our past assumptions are not always a clear indicator of future conditions. Early reports of Covid’s arrival in China struck many as reminiscent of earlier health scares like Ebola or SARS, which captivated the popular consciousness but ultimately caused little impact to day-to-day life.
As the pandemic progressed, many believed that effective vaccination and public health measures would bring the emergency to a swift end in 2021. But a Fourth of July celebration of freedom from the virus proved premature. Nobel Laureate economists predicted that stimulus-fueled inflation would be short-lived based on analysis of past conditions but persistent, record-breaking inflation now looks to be the defining economic and political issue for the foreseeable future.
The same is true in the world of marketing: assumptions based on past conditions no longer serve as reliable indicators of current or future outcomes. Performance-based marketers have seen this already: Software platforms meant to drive marketing outcomes based on large behavioral datasets have shown diminished accuracy and utility since the pandemic. Consumer behaviors arising during an unprecedented disruption no longer mirror the ones that the AIs had mapped pre-Covid.
The path forward for marketers has already been somewhat illuminated by two other developments that have coincided with the pandemic: Google’s deprecation of third-party tracking cookies, and proliferating privacy enhancements at both the consumer and regulatory levels. Starting next year, marketers will lose access to the tracking-based data collection that allowed for efficient segmentation and targeting for digital ads. The structures and technologies built around this infrastructure are in the midst of wholesale change and adaptation by all parties is ongoing.
What most consumers don’t realize is that the segmentation afforded by cookie-based tracking at scale also means significantly more revenue for the websites that enable them.
What’s really needed at every level of the digital advertising value exchange is greater transparency. A recent report by McKinsey put it this way: “After the loss of third-party cookies and identifiers, advertisers and publishers will find that the value of direct engagement with consumers will further increase. To create consumer connections, advertisers and publishers should create experiences that consumers consider worthwhile. Advertisers and publishers will also need to identify the investments and operating approaches that will help them stay connected with as many consumers as possible.”
Without the behavioral data and scale that has enabled cookie-based audience segmentation for digital advertising, brands will have to put more effort into developing relationships with their customers.
Publishers will have to rely more on tactics like subscriptions, email authentications to access content and other one-to-one methods that deliver enough value to the audience that they will willingly offer up some of their identifying information.
For brands to engage their customers in this “new normal,” they’ll need to also incentivize engagement and the collection of reasonable levels of first-party data. The future of advertising will mercifully involve less unwanted digital surveillance but it will be in everybody’s interest to operate within the framework of providing value in exchange for that data.
The basis for that value exchange is still an open question. The customer relationship is already valuable to the brand and a thoughtfully-managed brand can provide immense value to the engaged consumer by way of continuing education, special offers and things like loyalty programs. All of this requires better understanding the consumer and that often begins with asking forward-looking questions.