The Great SMS Comeback: How The Demise Of Third-Party Cookies Is A Triumph For Texts

By Kostas Kastanis, Deputy CEO, Upstream

The definitive and absolute termination of third-party cookies – something that was once unthinkable to marketing teams – is now imminent. For years, brands have leveraged the convenience and accessibility of third-party cookies to track internet users throughout their online journey, paving the way for strategies like re-targeting and contextual display advertising. Soon, thanks to Google’s recent pivot on privacy, the era of cross-site tracking will be confined to the history books. So, is the great cookie collapse all bad news, and how channels that rely on first-party data – such as SMS – are making a surprising comeback? 

According to recent estimates, more than 80% of all marketers are reliant on third-party cookies. They’ve shaped the digital marketing world, allowing businesses to effectively “follow” website visitors around the internet, targeting them with relevant ads. In a bold move, Google has joined the ranks of Safari and Firefox by announcing an end to third-party cookies by 2022. While hits from Safari and Firefox may have been easy for marketers to weather, Google’s consistent 60 – 70% share of the global browser market makes this the fatal blow for third-party cookies. In other words, marketers need to get their affairs in order – and fast. 

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Re-thinking first-party cookies

It’s perhaps little wonder that “cookie depreciation” was voted the top digital media challenge of 2021. Marketers are going to have to reorient themselves in order to maintain their targets around brand awareness, customer engagement and overall market penetration. But perhaps this shouldn’t be a numbers game after all? While third-party cookies allow for the targeting (and re-targeting) of consumers en masse, showering them with relatively impersonal ads bears little fruit in the grand scheme of things, and it’s certainly not a preferable customer experience. How many of us have been followed around the internet by an ad for a product we clicked on once out of curiosity yet have no intention of buying? Marketers do this because third-party data is readily available, easily accessible and extremely convenient. 

First-party data, on the other hand, is more difficult to gather and maintain. Businesses need to source this data themselves by encouraging their customers to part with it, and they need to work hard to maintain it and use it effectively. The results of this first-party approach might be smaller in scale, but it allows for much greater personalisation of the overall customer journey. We’re likely to see a small surge in “walled gardens”, online environments where customers exchange their data for access. We’re also likely to see marketers pivot more heavily into multi-channel customer experiences, putting first-party data like phone numbers and email addresses to more effective use. 

Who’d have thought SMS would be the marketing tool of the decade? 

SMS is a channel many of us associate with the early 00s’, but it’s now re-emerging as one of the strongest marketing tools in a company’s arsenal. By 2024, there will be more than 7 billion mobile users worldwide and the market for SMS marketing is set to be worth a staggering $83 billion. Those are broad-stroke numbers, but if we drill into the detail it becomes clearer just how much SMS is now winning out over other first-party data channels. For instance, post-pandemic survey data reveals that nearly 80% of consumers say that text messaging is the fastest way to reach them, and three-quarters of consumers actively want to receive special offers by text. The case for SMS is made more compelling when you consider the average response time to an SMS is around 90 seconds, compared to email which takes consumers around 90 minutes to respond. That’s if they respond at all – SMS messages have a 98% open rate versus email’s 20%

The pandemic has, of course, altered the way businesses engage with customers and vice versa. As consumers have adapted to a more digitalised environment, they’re now looking for ways to engage with brands on their own terms with minimal time-drain. It’s perhaps a fortunate coincidence that this shift in consumer expectation has occurred just as third-party cookies are about to make their final exit. It means that brands will be forced instead to lean more on first-party channels like SMS in order to create a tailored, nuanced and highly-contextualised relationship with their customers – and that’s precisely what their customers are now looking for. 

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