Why a household-first approach and alignment can save marketing

The official death of the cookie is currently slated for 2024, and marketers are already preparing for this inevitability with a range of strategic alternatives. What no one is talking about, though, is that these regulations are not as sweeping as your ‘Accept All Cookies’ pop-ups make it seem, and that leveraging a household-first strategy in your social and digital advertising provides a better framework for measuring incremental ROAS than approaches predicated on third-party cookies.

Reports of [the Cookie’s] Death Are Greatly Exaggerated

While third-party cookies will be with us well into 2024, many marketers have turned to cookieless and first-party data capture strategies. A successful first-party (and zero-party) data strategy includes two key elements:

1. Understanding how, where, and when Personally Identifiable Information (PII) is being used
2. An approach to content and data whose  underlying value exchanges include both privacy and consent

Though standard definitions of PII exist ,  this will really be a moving target in the coming year. Legislation – like the California Consumer Privacy Act (CCPA) and the California Privacy Rights Act of 2020 (CPRA) that include a broad range of what could be considered PII if not anonymized – will drive changes to the boundaries of what is and isn’t PII..

Effective first-party strategies will need additional layers of consent in the value exchange. Simply offering a coupon or discount to drive opted-in email capture is not robust when it comes to capturing explicit identifiers from users – especially as they relate to first-party data collection and PII data.

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Even a Good [Walled] Garden May Have Some Weeds

Ten years ago when advertising to Google or other walled gardens, marketers had access to a vast amount of PII for audience selection and refinement.

Weed #1 – Privacy and Third-Party Cookie Deprecation Have Curtailed Their Data and Measurement Capability

With the deprecation of third-party cookies, increasing privacy restrictions and limitations coming both from legislation and other tech companies (e.g., Apple’s ATT), the walled gardens have become less desirable for marketers.

This leaves an information gap on top of the typical drawbacks of using a walled garden: not owning all your own data, companies being intentionally opaque with their proprietary data, and less user-specific data in favor of cohorts.

At the same time, consumers are moving to other walled gardens (TikTok) and in general to the open Internet. Time is increasingly spent outside the traditional big walled gardens (Meta and Google),

Weed #2 – Single-Channel Attribution is an Exercise in Futility

The walled gardens have been major proponents of attribution. The appeal to marketers is obvious: who wouldn’t want to be able to assign fractional credit and the relative importance of each channel on sales? This has been the promise of multi-touch attribution (MTA).

Over the past two decades there have been an array of attribution algorithms like first-touch, last-touch, last non-direct touch, linear, and U-/W-/Z-shaped attribution. Having an attribution model within a walled garden, though, will never provide sufficient measurement for multi-channel, multi-touch campaigns that include both offline and online media.

Modern marketers have given up this search for the holy grail of attribution and instead have gone back to basics and focused on incrementality, which places the emphasis on measurement and determining whether a desired outcome –a sale or  a conversion – would have occurred without some other event – an email, a direct mail piece or a digital ad. Hold-outs (A/B tests) that measure lift over control have been fundamental to direct marketers arsenals since the advent of catalogs and direct mail.

Home is Where the Hearth Is

Since the dawn of humanity, every home has had a cooking apparatus – from a communal, open fire to a specialized, ceramic-top range. In the 21st Century, our homes  have another discernable characteristic. They are a physical place with observable patterns for how our technology and devices are employed under one roof.

The coronavirus pandemic shifted individual behaviors away from the public square and back into the household. People are learning, working, and exercising from home. They’re sharing internet-connected technology and adding new devices at such a rate that  the average American household now has 13. With more devices together on one Wi-Fi network, we have key information for building identity graphs that can unlock marketing opportunities.

All of this goes to say, our homes are more than just a location. They’re the source of robust geo-spatial insights including income, family make up, and purchases that can provide marketers with the ultimate context for effective audience selection and activation.

A household-first approach to collecting proprietary first-party data can fill the gaps left by walled gardens and an entirely digital or social strategy. High-value first-party and second-party identity graphs will be incomplete without this dimension..

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No One Can Whistle a Symphony

For the foreseeable future, the pendulum is swinging towards making the customer the owner of the data and protecting their PII. However, the additional data points that are still accessible to marketers from households and the context they provide are very viable starting points for multi-channel strategies for both offline and online marketing.

Ultimately, households can and should be used to align offline and online media to optimize audience selection and their respective activation. A household-first marketing approach is more robust than the stop/go conversion principles of marketing provided by a walled garden alone. Household-first means starting with known audiences, setting up rich testing frameworks within your own parameters, and easily measuring lift over control. It takes friction out of the marketing experience and drives sales conversions.

As privacy laws and seismic shifts in big tech continue to force shifts in thinking about data, rights, and consent, marketers should worry less about attribution and more about how household-first data provides rich audience information and the ability to measure incrementality. Attribution is a fools’ errand – sales are not.

Not everything that can be counted counts, and not everything that counts can be counted – Albert Einstein