The only way that brands can understand their customers is by collecting data, but a recent shakeup that aims to improve consumer privacy and control is cutting off one key source: third-party cookies.
Simply put: the phasing out of third-party cookies from Google Chrome will make it harder for consumer packaged goods (CPG) companies to capture high-quality customer data from online channels. As a result, in order to do effective marketing, CPG marketers are looking for other ways to capture data before this is scheduled to go into effect in early 2022.
Before Google announced they would do away with third-party cookies, there was already GDPR in place in the EU and CCPA in California. These measures seek to protect consumer privacy and data, but they also have the unintended consequence of making marketing that much harder for CPG brands.
Now that Google’s third-party cookie ban is being added to the mix, it’s time for CPG marketers to capture high-quality customer data online (and offline) in new ways. While some advertising-adjacent companies are working to create an alternative to these cookies, marketing departments are also taking the time to determine what data they really need to understand and connect with their customers.
When faced with Google’s decision, there are two sides to the solution. First, CPGs need to be collecting a lot of their own data (first-party data) and they also need to find a data partner to supply them with the insights they are unable to gather on their own. Being able to connect these two pieces gives CPG marketers a clearer picture of consumer sentiment and behavior. With this comprehensive understanding, CPGs are empowered to put together an effective advertising strategy and boost sales.
Let’s break down these two factors.
The phasing out of third-party cookies from Google Chrome will make it harder for CPG companies to capture high-quality customer data from online channels.
Brands Are Turning to First-Party Data
The issue with vanishing cookies has proved to CPG marketers that they need to be more self-reliant. Relying on an ad network or internet browser to supply necessary data subjects them to the will of these data collectors. To combat this, some brands are opting to sell direct-to-consumer (D2C) through new eCommerce channels. These direct selling channels make it possible to collect data on their own and use it how they see fit. No longer will they have to rely only on an ad network or marketplace to supply them with the data they need to reach their customers effectively.
Brands are giving this a try with unique campaigns to connect with customers. KFC has an advantage by having their own restaurants, but their holiday campaign to offer branded Christmas sweaters and other apparel gave them unique insight into their super fans—complete with names, emails, and addresses. This data is worth more than gold to brands and many leaders in the CPG industry are trying their hand at acquiring this data in new ways.
Corporate mergers and acquisitions are a great strategy to gain access to first-party data, especially when DTC channels haven’t been set up yet. When Unilever bought Dollar Shave Club in 2016 they became a stronger competitor against Proctor & Gamble’s shaving products. They also acquired a treasure trove of data from Dollar Shave Club’s pure-play origins. This exact data was nearly impossible to find when selling through a big-box retailer or marketplace, so the acquisition was a way to bring that crucial CPG data in-house.
While understanding intent and sales data online are important to any CPG strategy, it’s also valuable to remember that not everything has to be perfectly personalized in CPG marketing. When COVID-19 hit, consumers didn’t need a personalized offer to run out and stock up on toilet paper. Buying behaviors shifted overnight and any previous shopper analytics were unlikely to still be relevant. CPG companies had to shift messaging and work harder to keep key consumer packaged goods products in stock in grocery stores around the world. In such a different consumer reality, hyper-personalized marketing became an afterthought in retail.
Now that a vaccine is rolling out and some semblance of normalcy is on the horizon, it’s the perfect time for CPG marketers to think about their long-term data acquisition plans. Google is one year into their project to get rid of third-party cookies and data-driven D2C brands offer a glimpse of how CPGs should leverage their own selling channels to understand consumer behavior.
CPGs Must Partner to Unearth Additional Retail Data
When it comes to brick-and-mortar channels, CPG companies need eyes and ears on the ground. Creating a planogram and clearing it with a retailer doesn’t mean that they are going to follow it perfectly or that your displays will look as good on day 10 as they did on day one. Getting access to these shelf-health insights from real shoppers will give qualitative, quantitative, and even photo data to illuminate the effectiveness of a brand’s in-store presence.
Outside of the store, what best practices can CPG marketers use to capture customer data online beyond cookies? When launching new products, focus groups are invaluable. This might need to be virtual until COVID-19 is fully gone, but any chance to hear directly from consumers is a valuable learning opportunity. Customers have a wealth of insights about what they like, dislike, and can even make product and packaging suggestions someone so engrained in the brand might never have considered. Setting up opportunities to understand consumers’ ever-changing needs is the first step toward consistently providing the products and experiences they desire.
Data-driven D2C brands offer a glimpse of how CPGs should leverage their own selling channels to understand consumer behavior.
The bottom line here is that CPG brands need consumer data to inform their marketing strategies. While knowing every single customer is an unobtainable goal, being able to increase the amount of customer insights a CPG has access to is a way to get around Google’s cookie decision.
One reason that CPG companies partner with Wiser Solutions is because they get unparalleled insight into their merchandising in near real-time from real consumers. Being able to gain high-quality shopper insights that are tailored to the products you sell is essential. Adding competitive data points from online channels to the mix makes it possible to build a comprehensive CPG marketing strategy.
Wiser serves as a data partner for CPG marketers to help them understand and optimize their brick-and-mortar, as well as digital, channels. This crucial data that spans online and in-store helps supplement other data streams to provide a clearer picture of customer and market data.
Get in touch with Wiser today to learn how to get ahead as we enter a post-third-party cookie retail reality.