Google, Apple and Mozilla have all introduced sweeping privacy changes recently that will collectively phase out third-party cookies, used for decades to track users' web browsing history. Finding a replacement for cookies is a massive challenge, given that the entire digital ad ecosystem, worth $330 billion USD globally, has been mostly built around them.
Why it matters
The changes mean the conventional modes of remarketing and digital advertising are under threat. It’s becoming harder for brands to have meaningful 1-2-1 relationships with customers as they become further removed (pushing their investment and control to the likes of Google and Facebook). For customer acquisition online, advertisers need to focus more on generating their own first-party data. Retailers and brands are therefore seeking new ways to gather data from their own multi-channel content and use it to influence consumers and win sales in a post-cookie world.
At Epsilon, we’re excited because so much can be achieved with smart digital loyalty programmes to mitigate the loss of cookie-based ad targeting and to re-establish that direct relationship and value exchange directly. We want to share our insights about what’s possible.
Listen to Epsilon’s loyalty expert Elliott Clayton shedding light on the future of digital loyalty in the recent Let’s Talk Loyalty podcast. He discusses the changes unfolding in digital media advertising and privacy issues around customer acquisition. Don’t miss his tips on how loyalty can help brands drive stronger business outcomes.
So, how can loyalty programmes help?
Many retailers and consumer brands are revisiting loyalty programmes as a means of gathering and encouraging first-party data sharing while simultaneously reaffirming value to their customers, both on and offline.
Brands including Pret a Manger and McDonalds in the fast-food vertical, and Sephora, Maybelline and Kiehl’s in health and beauty have all recently invested in fresh, engaging digital loyalty programmes. They aim to build their customer base, and forge lasting relationships with customers by offering meaningful, personalised content and relevant rewards. Often, they partner with other organisations to bring content to life, and innovations such as personalised video messages are beginning to bear fruit.
The big picture
Life after cookies could be amazing, says Elliott Clayton in the Let’s Talk Loyalty podcast. Retailers should view the fall of the third-party cookie as an opportunity.
Here's why:
- A retailer’s first-party data is potentially far more valuable than third-party cookies
- Cookie-syncing caused latency and degraded quickly, reducing reach for advertisers
- The cookie's virtual invisibility hindered consumer awareness of the value exchange
First-party data explained
By analysing first-party data gathered from loyalty programmes and customer browsing behaviour on their own website, retail marketers are able to pull together an overall profile of their typical client base. Remarketing efforts can be planned more cost-efficiently, based on this owned insight.
Communication can flourish
An additional automated layer of one-to-one communication is possible with a digital loyalty programme, which has other touchpoints beyond SMS and emails. “Additional touch points drive additional value and incremental return,” says Elliott in the Let’s Talk Loyalty podcast. “You’re talking about 20% to 30% more return form an existing asset, which is a massive game changer.”
Case study: Walgreens builds healthy relationships with truly engaging loyalty
US pharmacy giant Walgreens wanted a loyalty programme that would power up relationships with customers while promoting a healthy lifestyle. They opted for an incentive-based digital programme, offering easy ways for customers to save money and be rewarded for purchases, services, and healthy behaviours.
Our solution: To encourage healthy outcomes, the Balance Rewards programme made goals achievable for Walgreens’ tens of millions of loyalty members. For instance, participating in a four-week health challenge meant they could earn Walgreens Cash rewards for every week completed. The loyalty platform supports and routes data for each customer interaction, so members see every day wins.The bottom line
Digital loyalty is the best way to acquire customers, personalise your communications and establish a direct relationship while driving long-term sales growth. It’s a self-funding first-party data asset, that is privacy-friendly, and offers a powerful value proposition to your audience. When digital loyalty is executed really well, life beyond cookies can still taste sweet.