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Why the end of third-party cookies is good news for CPGs

May 9, 2022
  ●  
Cynthia Nakad

As the return to the protection of privacy continues, many have become aware that one of the most popular companies, Google, will be phasing out third-party cookies. 

This is a monumental shift in how digital marketing will be performed in the future. Although the inability to leverage third-party may look like concerning news, it might very well be the golden opportunity CPGs have been waiting for to finally be back in the driver's seat when it comes to their consumer data - which has traditionally been in the hands of retailers.

TABLE OF CONTENTS

What were third-party cookies doing? 

When you went to a website, trackers would be placed on you that would track your actions within the site and when you would exit the site. For example, actions it would follow would be if you were to add an item to your cart or purchase an item and how often you would buy it. It also ends up tracking your information when you revisit the site and how often you would visit the site. 

There was a benefit for both users and those managing the sites when it came to these third-party cookies. Users could start to have a more personalized experience every time they visited the site, and marketers were able to gather the appropriate data points to facilitate those experiences. 

This was supposed to bring insights into the user behaviour of customers that, in the beginning, were a very useful asset. However, the major issue that came with third-party cookies was the fact that users weren't always aware of what information they were providing to these sites and how that information would track with them outside the sites. 

As a result of users’ growing privacy concerns, it led to changes in numerous countries, adding legislation requiring users visiting sites to agree to the usage of allowing those third-party cookies to track the data. 

When is this going to happen? 

The official date from Google was updated earlier this year that by the end of 2023, it will officially not be possible to use third-party cookies. Several other popular browsers have already applied, making it harder for traditional digital marketers to gain the insightful data needed to make informed decisions by senior management. 

That means now is the time for CPGs to start transitioning out of third-party data (where data is collected passively through these cookies) and invest in strategies and technology that allow them to reclaim their consumer relationships. 

One way to do that is to seek a direct and reliable source of information - their consumer.

What is zero-party data?

Zero Party Data is where the consumers themselves actively participate in providing critical information points about themselves, their preferences, and the products they use. It's reliable because it comes from a trusted source (consumers themselves), and there's no issue about the source of the data or the viability of that data point. 

It is also an instance where the customer is actively engaged, so you're able to ask more questions about a product specifically than would be possible with data that is acquired through cookies. This information can include purchase intentions, personal contexts, and communication preferences. 

One of the primary issues with first-party data is that it captures the transactional journey to purchase a good, but it doesn't capture exactly why the customer bought that product. 

It can help the user journey online, but it doesn't help with the reason why they purchased that product. This element helps with the user experience and their journey on the site to buy something yet won't help improve the product in the future. 

When gathering zero-party data, we're able to get more detailed data points such as a consumer’s demographics, personal characteristics,  lifestyle and dietary preferences, and even their shopping habits. Then we go to more qualitative features that are not able to be answered through zero-party data. Questions such as why your brand is selected over others, or their overall thoughts on the product can be easily acquired. 

Additional points such as which retail stores they usually buy products from or what was their intention to purchase in the first place are also able to be asked. 

This highlights the importance of zero-party data. It goes into the details of why someone would want to buy a product and is extremely useful to certain industries that need to shape their products for what the consumer is looking for in the future.

How to collect Zero Party Data

In our digital age, there's no longer the question of how to collect zero-party data being asked, but simply what tools are we going to use to get CPGs zero party data. Especially with the pandemic pushing us more and more online, it's easier now more than ever to be able to capture those critical data points that we have somehow lost focus on with the dawn of digital marketing. There are a variety of tools like social media polls, website preference questionnaires, product finders, loyalty programs, and even digital sampling programs to help get started.

The key to successful zero party data collection however is that it must be a win-win exchange between consumers and brands. If consumers are taking their time to willingly share their data with a brand - there must be something in it for them as well. So creating an incentivizing value exchange will be key for success. 

Finding the right tools to obtain zero party data

Collecting this information on a one-on-one basis can be a big logistical undertaking, so CPGs looking to adapt quickly need to seek out the right tools to effectively collect, process, and action zero-party data at scale. 

With Sampler, you can build a high-value sampling program that delights consumers with a personalized free sample delivered to their right to their home while gathering valuable ratings, reviews, and email opt-ins. You can even send your consumer a set of post-sampling questions to learn all about their experience with your product and their future plans to purchase. 

Your Sampler dashboard helps you view and analyze your collected first-party data in real time and reveal key insights like: 

  • Who your consumers are: their age, demographics, skin type, dietary preferences, shopping habits
  • Why they choose your brand over others 
  • Which retail stores they shop at most often
  • What they thought about your product
  • How likely they are to recommend your product to their friends 
  • What their purchase intentions are

What’s even more valuable here is the ability to retarget and remarket to this high-value group of consumers who have now tried your product and using your collected insights to personalize your communication with them - all the way to purchase and beyond. 

Takeaways

The end of third-party cookies on Google and eventually most browsers means a return to gathering data points that might end up being more impactful and valuable for brands.

At Sampler, we see a bright future for CPG brands to build more direct relationships with consumers. The key here will be creating a compelling value exchange (like a personalized product experience) that consumers deem worthy enough to willingly share their information.

Sampling
Consumer insights
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