Today, a majority of auto dealerships find themselves at a crossroads as 2024 looms. In 1992, Netscape invented the cookie, which sparked the profitable revolution of online advertising. So, Google’s announcement of its plan to phase out third-party cookies due to privacy concerns has sent ripples across the industry. And don’t think you’re safe with other browsers, Apple and Mozilla are phasing them out too.
Initially planned for 2022, the phase-out was kicked down the road to 2024. However, in a recent dealership survey from PureCars, 58% of dealers are either unaware or unsure about this forthcoming change.
In comparison, 55% are unfamiliar with or only moderately aware of how a cookie-less landscape would affect their ability to target potential customers.
Moreover, 65% of dealerships have voiced concerns about how this could affect their digital advertising performance, and you may be one of them.
As the saying goes, forewarned is forearmed. So, understanding the implications of these changes is the first step, and strategizing how to leverage Customer Data Platforms (CDPs) can help dealerships adapt and thrive in this evolving landscape.
Understanding Google’s Cookie Depreciation
The cookie depreciation means that third-party cookies, a mainstay of digital marketing, will be eliminated. These tiny files, stored on a user’s device, allowed advertisers to track a user’s web browsing behavior, enabling targeted advertising. With Google’s plan to phase them out, the traditional ways of gathering customer data and generating personalized ads will no longer be feasible.
The Rising Importance of First-Party Data
First-party data – information collected directly from your customers – will be king in a post-cookie world. This includes data from sources such as website analytics, CRM systems, social media interactions, and transaction history. Unlike third-party cookies, first-party data is generally considered more reliable and accurate, providing a deeper understanding of customer behavior.
The Power of Customer Data Platforms
In this scenario, Customer Data Platforms (CDPs) are set to become the game-changers. You might wonder if it’s the same as your CRM, assuming you have one.
You may also have a DMP—is that the same? The answer is no regarding both. As Oracle states here, a CDP piggybacks onto your CRM and DMP to give a more complete view of your customer.
CDPs are software that consolidate and organize a company’s customer data from various sources into a single database. This can be incredibly beneficial in several ways:
- Unified Customer View: CDPs help dealerships get a 360-degree view of their customers by consolidating data from various touchpoints. This can provide insights into customer preferences, buying behavior, and engagement history, enabling dealerships to create personalized experiences.
- Improved Targeting: By understanding your customers better, you can create more accurate customer segments and deliver targeted advertising that resonates with them.
- Optimization of Marketing Efforts: CDPs provide real-time insights, enabling dealerships to measure and optimize their marketing efforts continuously.
- Compliance with Privacy Regulations: CDPs rely on first-party data to help dealerships comply with data privacy regulations. This is particularly important in the face of increasing scrutiny and regulations around data privacy.
Prepping for a Post-Cookie World
As we approach 2024, dealerships should take proactive steps to adapt to the new landscape:
- Invest in a CDP: If not already done, now is the time to invest in a reliable CDP. Look for a platform that can easily integrate with your existing systems, provide real-time insights, and scale as your dealership grows.
- Focus on First-Party Data Collection: Make it a priority to collect as much first-party data as possible. This could be through online forms, surveys, or customer interactions across various touchpoints.
- Build Customer Trust: Be transparent about your data collection practices. Building customer trust is critical as you rely more on first-party data. Ensure they understand how their data will be used and how it benefits them.
- Optimize Your Website: Your website will be an essential first-party data source. Ensure it’s optimized to provide an excellent user experience and encourages visitors to interact, providing more data points for your CDP.
The cookie depreciation in 2024 poses challenges, no doubt. But it also offers opportunities. Dealerships that take the initiative to adapt and leverage the power of CDPs will be better positioned to deliver exceptional customer experiences and drive growth in the years ahead.