Article by Cheetah Digital, vice president of go-to market APAC Billy Loiseau.
With the death of cookies, the “value exchange” between businesses and their customers’ willingness to share personal data has never been so important. Activating cookie-free data to improve customer experience and extract insights is a craft and skill that marketers need to invest in and develop.
Marketers agree that they need to survive, lead, and stay relevant in a cookie-free community – a fact right around the corner. Driving with loyalty and adopting a Zero Party Data strategy will help marketers survive by creating long-term relationships with customers with a clear and concise value exchange.
It’s time for a new marketing recipe.
How will life change for marketers?
It’s a stressful time for marketers. Many think their lives would be down to ninth degree without cookies. But, perhaps a different look will give respite to the stress and show that there will be life after the death of the cookies.
Technology doesn’t need huge sets of personal data bundled together across dozens of websites and apps in order to succeed. Advertising has been around and thrived for decades without it. And we are here today because the path of least resistance is seldom the path of wisdom. If the business is based on misleading users, on exploiting data, or on choices that are not choices at all, it does not deserve our praise. It is worth fixing.
Big brands, publishers, and technology could face legal repercussions, potential class action, and regulatory penalties for breaching the GDPR. Companies will no longer be able to assume that if they cannot identify someone by their IP address, for example, the privacy law does not apply to them. Under the proposals of lawmakers, it will.
Challenges, opportunities and saying no to “rent” data
But there is life after the cookie dies. Zero data can help marketers connect with their customers. This preference data comes directly from the consumer. No middlemen, no guesswork – it’s psychological data that includes customers’ values, attitudes, interests and personality traits.
The CEO of a think tank notes how outdated and outdated data operations are.
“Research shows that 70 percent of consumers accept [consent] Conditions, even if they are not comfortable with it. When we ask them why, three-quarters of them say the reason is the only way to get to the product. There is no way for consumers to express their preferences and get products that meet those preferences – because they are just showing or letting go.
“More than 90 per cent of Australian consumers are uncomfortable with how their data is collected and shared, and they are unable to do anything about it. They want the government to step in and protect them.”
Consumers are more protective of their personal data than ever before. In the Australian Privacy Community Survey 2020, 7 out of 10 respondents nominated privacy as a major
concern for them, while 87% wanted more control and choice in the collection and use of their personal information.
So what is the solution? Companies need to stop renting data and create their own database through direct-to-consumer relationships (DTC). The key to future success is building a loyalty initiative that delivers mutual value. Customers can willingly submit their personal data in exchange for a better customer experience.
Loyalty is nowadays a multifaceted tool. It helps bring customers back to the brand and at the same time helps brands understand their customers.
The loyalty program began as a simple token program in the 18th century in the United States. Then, US retailers began giving customers copper tokens with purchases that they could later redeem on future purchases.
In the 19th century, the British Green Shield awarded stamps for purchases from select retailers that could later be exchanged for catalog products. Fast-forward 200 years, and loyalty programs have evolved from a factory stamp card operation to cutting-edge programs that benefit retailers and customers alike.
The goal of customer loyalty programs has historically been to create tools that marketers can attract to stimulate desirable behaviors among consumers, i.e. increase the size of the basket or reduce the time between transactions. But now they are much more than that. Loyalty programs are not just about offering discounts and coupons to members; They are an extension of the brand and provide an “experience” that goes beyond the product or service that retains customers.
But what makes a great loyalty program? Another CEO shares seven regions. They recommend that organizations implement each of these points to ensure they have a strong and consistent loyalty program that will benefit customers and brands alike.
1. Business: First and foremost, the business must be profitable and sustainable
2. Members: Organizations must understand the behaviors, beliefs and affiliations of loyal members
3. Program: Loyalty program should be useful and desirable to consumers
4. Team: Organization employees need to sign up for the loyalty program and be willing to endorse it
5. Technology: Technology should be relevant for the future rather than now
6. Data: Ensuring that the loyalty program captures the necessary data for analysis and related actions
7. Dialogue: Any corporate dialogue with a client should be dynamic and personal at all times
A multi-faceted loyalty program
One popular brand presents an example of a sophisticated loyalty program. This year they launched a mobile loyalty program that rewards customers for engaging with the brand on social media.
A loyalty program offers added value to customers, and in turn allows them to develop a deeper understanding of their customers. This symbiotic relationship created better customer experiences as it grew to 12 million members in just two years. Additionally, nearly 50% of all DTC revenue comes from their loyalty members, and they see significantly higher spending from loyal members versus non-members.
Loyalty data has helped this brand in five ways:
1. Definition: Ability to identify customers across devices and channels
2. Insight: Learn more about what customers love to do
3. Personalization: Help create messages that resonate with customers and thus build trust and enrich data
4. Preference: Understand and activate relevant brand message on customers’ preferred channel
5. Attribution: Measuring the results of marketing campaigns
Unleash the value of loyalty in an unparalleled future
The importance of loyalty programs should not be overlooked as an important part of a marketer’s toolkit. Loyalty programs are the perfect alternative to connecting customers with brands in new and innovative ways now and beyond a cookie-free world. It gives organizations a straightforward, fringe-free approach to unlocking deeper insights for their customers, unlocking new customer experience opportunities, and unlocking powerful new avenues for more sustainable and meaningful customer relationships.