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Data Trends for 2021: Overcoming Digital Ad Uncertainty

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The only certainty of 2020 has been uncertainty. Along with the rest of the world, marketers are fighting pandemic exhaustion, setting their sights on 2021, and hoping for some predictability. It isn’t easy, especially as the predominant ad purveyors like Google, Facebook, and Apple are changing the rules and continuing to keep their data closely guarded in walled gardens.

In January, Google rang the death knell on third-party cookies, and in June Apple announced pending changes to its latest operating system, putting into question the utility of the Identifier for Advertisers (IDFA). The tech giants are facing antitrust litigation by the Federal Trade Commission for their dominant, potentially monopolistic positions in social networking and search advertising. Consumers and governments at all levels are taking privacy seriously with increasingly complex, and likely more widespread, regulations including California’s recent passing of Proposition 24, which some have compared to GDPR.

The combination of these market forces will fundamentally change how brands identify and market to consumers and prospects online. With that in mind, here are three guideposts to hold onto in 2021. 

First-party data sets must be expanded and optimized

Of course, first-party data is the holy grail. This is the data brands collect directly from new and loyal consumers who have made purchases and/or opt in to receive marketing. It’s authoritative, it’s accurate, it provides better insights, and it’s the first step in owning the customer relationship. If brands aren’t prioritizing building and optimizing their own consumer data sets, their marketing efforts will inevitably fall short.

But you can’t just buy first-party data; it has to be built over time using creative and robust engagement strategies to capture pieces of the consumer’s identity. Marketers are using every digital tool available to build a robust first-party data set, as it not only impacts marketing on open channels but is also critical to maximizing the effectiveness of digital channels that rely on walled gardens. Customer identity markers such as email or phone number must be included in the first-party dataset in order to link to online audiences within those digital channels. 

And while third-party cookies stand on shaky ground for the future, brands can still cookie consumers in their first-party database to collect insights that impact marketing strategy — especially when those first-party cookies are connected to an email address. Combining online data with offline data to make it more complete and powerful is critical to ensuring a strong foundation for attribution and identity resolution. 

Second-party data will increase in value and importance

The rise of second-party data is no surprise as competition has loomed large in recent years – and the consumer data world is no exception. Having a mutually beneficial way to exchange data among brands targeting similar consumers in a privacy-compliant way can help brands build loyalty and increase their conversion rates. Compliance is the key factor here since no one wants to risk exposing personally identifiable customer information. 

This is where the growth of data exchanges has come into play. Since it’s not practical to search for individual organizations with which to share first-party data, marketplaces serve as neutral parties to broker the transaction, using technology to normalize and protect the data sets. Using this type of arrangement, buyers have transparency into the data source and greater confidence in its accuracy. A data exchange is a great way to both build and monetize your own first-party data.

In 2021, I expect marketers to rely even more on data exchanges as a way to expand their access to identity data. This will likely push into the world of data-clean rooms in which the data is also hosted by the neutral party who keeps data anonymous on a secure, isolated platform while linking the data using a common identifier, such as email address. The benefit is that marketers receive ad impression data at massive scale across multiple platforms for audiences that match their own.

Also look for data analytics sandboxes to add an analytics layer that allows users to do extensive modeling and test hypotheses on data sets that are much larger than what they could have generated on their own. Marketers can contribute their own data to the sandbox, have it augmented, and then develop models, perform benchmarking, and create forecasts for future campaigns.

These are all ways marketers will lean into comparatively privacy-sensitive data collaboration to extend their identity resources.

Email will remain a critical identifier

As today’s marketers strive for a complete understanding of their most desired consumers in order to wisely spend their marketing dollars, optimize future campaigns and glean insights for future initiatives, marketers need a common identifier. Email has been, and will continue to be, one of the most critical unique identifiers. However, email is its own data beast as each consumer generally has at least three different emails. Identity resolution and digital/email data enrichment can help match emails to one consumer profile.

Email’s prominence will resurge precisely because of today’s omni-channel marketing strategies and the need to track consumers across multiple devices and digital properties – a list which continues to add apps, over-the-top (OTT) video, and connected TV (CTV). Identity resolution gives marketers the opportunity to expand their outbound reach and deliver the real-time personalization that today’s consumers value and expect.

Also, with privacy regulations on the horizon, email is a known and comfortable identifier that many consumers self-register and that brands can anonymize in a digital environment with hashed emails for privacy compliance. 

While 2020 has thrown a lot of curve balls, marketers that worked to get their consumer data house in order with an eye on ways to better enable their first-party data for a complete view of their most-desired audiences and buying behaviors will survive and thrive as we head into 2021. The newest technology, data-sharing innovations, and identity resolution algorithms won’t help if you don’t have the basics down.

Kevin Dean is COO of Infutor.