How to Move Beyond Third-Party Tracking in 2024
Find out why securing PII handling and cross-domain tracking gives digital advertisers a competitive edge.
In a world of post-third-party cookies, digital marketers are challenged to rethink their tracking strategies. Greg Brunk, head of product at MetaRouter, writes about how utilizing first-party data collection and cross-domain tracking can unlock personalized experiences while ensuring compliance with data privacy regulations.
Since Google announced the planned death of third-party cookies in 2019, digital marketers have awaited the dawning of a new, cookieless day. Now, that day has arrived.
As of Q2 2024, Google has deprecated cookies for 1% of Chrome users. And, by Q3, Google’s privacy Sandbox APIs are set to take full effect — leaving many digital marketers to pick up the crumbs of their third-party tracking strategy.
But Chrome isn’t the only browser blocking third-party tracking. Apple’s Safari, the second-most popular browser globally, rolled out internet tracking prevention (ITP) in 2020. As a result, over 80% of global users now log into browsers that severely curtail the power of third-party cookies.
With the Chrome Privacy Sandbox further limiting covert tracking methods like fingerprinting (and other browsers employing similar privacy-forward features), digital marketers face an uncertain future. Forgoing user data is simply not an option. According to a report by Grace Nasri of Digitaltrends, nearly three out of four consumers said they preferred to do business with retailers who personalized their shopping experience. Personalization is impossible without a semblance of understanding about a user’s behavior.
Furthermore, only one-third of consumers are willing to share their email without an incentive, which makes first-party data collection increasingly costly and challenging.
Reviewing these harsh realities may leave digital advertisers feeling defeated as we head into Q3 2024. However, the hurdle of first-party consumer data collection isn’t insurmountable. To improve their personalization and tracking efforts, marketers and advertisers must challenge their assumptions about client-side tagging and embrace a more sustainable and compliant approach to data collection.
The Problem of Client-Side Tagging
Client-side tagging is a popular and storied approach to tracking that places the burden of website processing on users. In a client-side tagging system, containers and related third-party tags (e.g., Meta’s Pixels and site tags) are activated once a user enters a website. These tags are dispatched from the user’s browser and ship data directly to various external endpoints, for example, advertising partners or other third parties.
This method of tracking has gained traction for its ease of implementation and ability to offer real-time data collection directly from the source, i.e., a user’s browser. However, convenience comes at a cost.
A proliferation of tags can significantly impact website latency. Slow page load times and lags lead to worse user experiences (UX), potentially driving visitors away. In February 2023, Alex O’Byrne of We Make Websites reported that studies have shown that a mere one-second delay in page load time can lead to a 7% reduction in conversions.
Inferior UX also jeopardizes a website’s ability to rank highly in search engines’ results. In particular, client-side tagging can negatively impact Google’s Core Web Vitals. Relevant metrics that impact websites include:
- Largest contentful paint (LCP): Measures the time it takes to load a page’s main content.
- Cumulative layout shift (CLS): Measures visual stability, penalizing unexpected layout shifts that may impact user selections (e.g., selecting “Check Out” when intending to select “Go Back”).
- Interaction to next paint (INP): Measures the time it takes for a page to react to a user selection.
Moreover, client-side tagging still relies on third-party tracking methods, which have fallen out of consumer favor. Eight in ten consumers say they’re concerned about how companies use their personal information, and 73% feel they have little to no control over data collection. And, most critically, for the bottom line, 71% of consumers won’t buy from a company that’s lost their trust.
See More: In A Cookie-Less World, First-party Data Is Marketers’ Bread And Butter
The Power of First-Party Data
Unlike third-party data, which is collected by external entities, first-party data is gathered directly by the owner of the digital property the user is interacting with. This direct interface is critical for several reasons.
It allows users to provide consent to be tracked and enforced, and it usually enables those tracking indicators to be more secure, i.e., anonymous and not necessarily tied to personally identifiable information (PII). PII includes information as seemingly innocuous as names and email addresses all the way to social security numbers and bank account information — in other words, information that companies must handle extremely carefully.
Collecting PII increases the potential for non-compliance, especially when that information is funneled through third parties. International regulations like GDPR and the California Consumer Privacy Act (CCPA) dictate a code of conduct for data handling, including:
- When PII must be deleted.
- How PII should be stored.
- How consumers should be informed of data collection.
Violations can result in hefty fines and indirect penalties like lost consumer trust (arguably even more costly in the long run). Companies that share or collect user data from third parties increase their scope of risk.
However, as cookies are deprecated across the browser landscape, PII and PII-based alternative IDs stand as one of the only viable alternatives for integration with programmatic and walled-garden advertising platforms, alongside in-browser proposals like Chrome’s Privacy Sandbox.
Those with strong access to PII will still be able to integrate with advertising ecosystems after cookies die. However, the handling of this data must be done behind consent collection and enforcement and within fully single-tenant, private and secure environments. Encrypting PII appropriately is also a crucial consideration before using this data within a downstream advertising landscape.
First-party data collection also leads to a more accurate and relevant database. Companies that make targeting and marketing decisions based on first-party data can rest assured their data source is trustworthy — after all, who knows the consumer better than themselves?
Improved First-Party Data with Cross-Domain Tracking
In 2016, 74% of marketers identified first-party data as the most valuable type for customer insights. Affinity for first-party data has likely increased during the years since, especially as more stringent regulations surrounding digital privacy have arisen. But if it’s so popular, why aren’t more digital marketers emphasizing first-party data?
Perhaps the answer is that the prominence of client-side tagging has prohibited many organizations from considering other options. Furthermore, the prevailing alternative to client-side tagging — server-side tagging — involves the setup of a cloud-based server container and new processing rules. Setup requires more buy-in than client-side tagging, which dissuades many small- and medium-sized businesses from considering adoption.
However, as we approach a cookie-less world, leaders must revisit server-side tagging and other affiliated solutions to remain ahead of the competition. Server-side tagging enables supercharged analytics capabilities and a more robust compliance strategy. It can also transform, map and filter first-party data without collecting PII. The latter capability is accomplished through cross-domain tracking.
Cross-domain tracking assigns anonymous yet unique IDs to all website visitors, enabling marketers to retarget and convert them down the line. This version of server-side tagging is particularly powerful when a user navigates multiple websites under one organization’s umbrella or within a partner ecosystem.
For example, if User A visits the Athleta website for the first time, cross-domain tracking solutions can identify them as a first-time user and create a javascript tag on their browser. Now, when User A visits Gap.com two weeks later, these solutions will do two things:
- Identify this user as a first-time Gap visitor.
- Recall their previous interactions with Athleta.
Without collecting any PII, marketers at Gap have ascertained several critical pieces of information about User A, including their size, style preferences and shopping attitudes. This information can inform a robust retargeting strategy for all Gap brands — without jeopardizing privacy or compliance.
No Third-Party Cookies? No Problem
Businesses that prioritize first-party data collection, server-side tagging with highly secure handling of PII and cross-domain tracking will be better positioned to deliver personalized experiences, build stronger customer relationships and stay ahead of the competition in a post-cookie world. The future of digital marketing lies in embracing these sustainable and compliant approaches to data collection and analysis.
Image Source: Shutterstock
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