Third-party cookies are set to crumble in Europe. Africa could offer a solution

Yet, responding to customer concerns about data privacy is a Catch-22 situation as although 89% of consumers are worried about data security and privacy, at the same time, 80% demand personalised services and experiences. 

Modern-day customers have developed sophisticated expectations when it comes to their online experience, and they quickly become frustrated when they don’t get what they expect.

This presents a challenge for many businesses because, in order to provide highly personalised offerings, they must have a deeper comprehension of their customers’ requirements, purchasing histories, and preferences — meaning, data.

This is where cookies — small bits of data saved on your computer while browsing that can contain information useful to both customers and service providers — come into play.

Third-party cookies, especially those used for tracking, have come under serious scrutiny prompting the EU to come up with legislation forcing businesses to ask for consent from consumers before collecting and storing information through this tool as far back as 2011.

But ever since Google announced it will do away with third-party cookies — something that the industry giant has been postponing for a while, although it claims the move is still on the cards — there have been many questions as to how to bridge the gap that is bound to appear right away. 

Industry experts agree that in a post-cookie world, there is no one-size-fits-all solution to ethically and efficiently collect, analyse and tailor customer data to offer personalised ads and experiences. 

What’s happening to the website cookies?

Customer concerns about privacy and the use of data continued to skyrocket as news of data breaches and cyberattacks inundated the media. 

The first half of 2019 alone saw a staggering 3,800 major data compromises recorded globally, affecting over 4.1 billion records. 

With such rampant violations of data privacy and security, it’s no surprise that the issue remains top of mind for customers, organisations, and regulators.

As a result, customers have increasingly turned to data masking tools, ad blockers, and cookies to protect themselves online. 

Meanwhile, organisations have been hiring information security officers and data protection experts to safeguard their systems with vulnerability testing. 

Policymakers have also heeded the public’s concerns by implementing a range of privacy policies and putting pressure on ecosystem players to prioritise data privacy and security.

In a bid to create a safer, transparent, and trustworthy online environment amid all the concerns, leaders like Google and Apple in the advertising and mobile OEM space have introduced various solutions such as Intelligent Tracking Prevention, App Tracking Transparency, Hide My Email, Private Relay, and more. 

However, one of the most disruptive changes on the horizon is the eradication of third-party cookies by Google. 

While this move is a positive step towards privacy, businesses have been consigned to oblivion to new ways to find, track, and offer personalised experiences to customers.

How will it crumble?

In the midst of global economic downturns, businesses are bracing themselves for the impending changes to Google’s cookie policy. 

With the current recessionary ripples brought on by the pandemic, the war in Ukraine, and supply chain disruptions, businesses have been struggling to acquire customers and boost revenue. 

The digital marketing landscape has served as a beacon of hope in these uncertain times, but as we approach the cookie-less world of 2024, businesses may find themselves struggling yet again. 

The parallels are clear — just as the pandemic disrupted the global economy, the cookie-less world is expected to disrupt digital marketing channels, making it even more difficult for businesses to acquire customers and drive revenue. 

The looming threat of the cookie apocalypse demands attention, and businesses must act now to adapt and thrive in the post-cookie era.

Africa might get to get its cake and eat it, too — unlike Europe

Since email addresses, and not mobile phone numbers, have traditionally been the unique identifiers for digital services in Europe, this limits the multiple sources that can be utilised to identify and track customers.

As a result, Europe and the Global North, in general, find themselves on the back foot.

This is where Africa excels. Africa remains a mobile-only continent and has experienced significant growth in mobile and internet connectivity in recent years.

Nearly half a billion users subscribe to mobile services in Africa, and mobile numbers remain the unique identifiers for digital services as many users do not have email addresses.

This structure puts Africa in an enviable position to scale the impending disruptive events on the horizon.

Advertisers in Africa are able to effectively cut through the marketing clutter and reach consumers directly on their mobile by leveraging the use of non-web telecommunications services such as SMS and USSD, which have remained popular.

These have also played a key role in reaching the majority of African consumers who own a basic phone rather than a smartphone.

The USSD transaction market, which has dipped in usage in European markets, continues to thrive and hold so much promise in Africa. As an example, users in Nigeria transacted 1.63 trillion nairas (€3.2bn) via USSD in the fourth quarter of 2020 alone.

Is it just crumbs on the table, or are there other options?

Companies that are able to adapt and embrace new strategies for identifying, targeting, and retaining customers are likely to thrive in this new environment.

Beyond exploring the use of first-party data, businesses will need to focus more on building strong, authentic relationships with their customers to drive loyalty and word-of-mouth marketing. 

This will most likely have to be done by developing and executing elaborate and effective customer engagement cycles.

Another opportunity for businesses and advertisers lies in the use of contextual advertising. 

By targeting ads based on the content of the website or app that a user is currently on, businesses can still reach relevant audiences without relying on individual user data. 

This approach may be particularly effective in countries where social media platforms are less prevalent, and other forms of digital content consumption are more common.

Overall, while the post-cookie world may present challenges for businesses, it also offers opportunities for innovation and creativity.

Ayodeji Balogun is the Co-Founder and Chief Technology Officer of Terragon, a data and analytics tech startup based in Nigeria.

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