Four ways retailers can succeed in the modern age of anonymized digital marketing

By Richard Wheaton, Managing director

Fifty-five London


The Drum Network article

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April 16, 2021 | 6 min read

Lockdown may be easing up and shops reopening, but it is clear the retail outlook has altered dramatically. Many big-name stores have closed their doors forever and even the latest of late adopters have needed to embrace e-commerce.

Chris Yang

At the same time the job of finding new customers online has become more difficult. Google announced in a recent blog post its plans towards a privacy-first web and the end of third-party cookies. This, along with a raft of new privacy regulations, means it is tougher than ever before to target customers online.

However, despite the challenges, the new world order presents significant opportunities for retailers. This is thanks to an untapped strength they have – namely their engaged customer bases. Retailers can embrace the opportunity to follow the data and develop new strategies fit for the modern era of anonymized digital marketing.

1. Have a plan for the end of the cookie

A central plank of online marketing to date has been the ability to retarget customers across the internet. This has been enabled by the dropping of cookies – enabling brands to follow customers around the internet and social media sites to target them with ads.

After a series of privacy scandals, this is an approach now being cracked down upon by both regulators and tech giants. Google had already declared its plans to stop using tracking cookies on its Chrome browser by 2022, but has further upped the ante in recent announcements. Google made its clearest position on privacy with a blog post around moving towards a privacy-first web. The company reiterated its commitment towards the Privacy Sandbox being developed as a primary solution towards enabling targeting in a post-cookie world. And the optics were clear – Google is enabling privacy-centric marketing.

Meanwhile, Europe’s GDPR and California’s CPA have set out the legal frameworks for new requirements for privacy compliance. Apple’s ITP safeguards now block the use of third-party cookies on its devices. The upshot is that retailers need a new approach for prospecting and retargeting to ensure they spend their budgets efficiently and accurately. The ability to target customers and provide relevant offers isn’t dead. It just became more difficult.

2. Remember that consent is king

The new focus should be on consent-based marketing. In the new world order existing relationships will be king, and consent has to be obtained to enable sophisticated messaging and targeting. For retailers this actually represents a good opportunity to realise the power and potential of huge and often unrealised first-party datasets, ranging from transaction data to mailing lists. Retailers, particularly grocers, have a rich and regular treasure trove of regular interactions and data points with customers that can be mined.

The new questions that need to be answered are how can you best serve your loyal customers and what are the best tactics for upselling them? In a cookie-less world power sits with the brand that has an existing relationship with a consumer. The solution is inviting loyal customers to grant permission to use their data. This then enables predictive analytics and targeting with the right offers at the right time.

3. Harness the growing power of the adtech giants

Google’s new announcement focuses on the end of third-party cookies in particular – but also heralds the start of a new approach to digital marketing. Namely moving towards clustering groups of users based on similar behaviours and signals. This forms the basis of audience segmentation to be used for prospecting and retargeting purposes.

Retailers who want to win in the new era would do well to familiarise themselves with Google’s tools to enable them to still tailor advertising. Using artificial intelligence, Google processes huge volumes of anonymized profiles to generate aggregated insights for ad targeting. Google can accurately track across publishers, devices and even offline channels. From this they extrapolate to the entire population, applying machine learning or more traditional online polling.

Google is certainly the most advanced in delivering a scalable solution for cross-channel media-buying teams. However, we can expect further moves from platforms like Facebook and Amazon.

4. Develop a data-focused approach to decision-making

While many might mourn the loss of the old systems that were driven by third-party cookies, the truth is that very few brands had the right expertize to accurately target consumers anyway. There were often huge data discrepancies, with ad fraud skewing the findings. Many will be uncomfortable with the consolidation of power within the big tech companies, but working outside these platforms always had significant challenges in terms of data leakage and duplication, and now will be even further complicated.

The best approach for all retail businesses is a cultural shift to put data-led decision-making at the top of their agenda. Re-engineering your digital communications strategy will be as crucial as the tools and technology you use. As retail gears up for a more hybrid digital future, even as shops reopen, it is time to fully realise we are in a new increasingly AI-driven digital era. The future is here to be embraced.

Richard Wheaton is UK MD of data company Fifty-five.


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Fifty-five London

The rapid shifts in technology have dramatically changed the way people interact and engage with brands. As media, distribution and creativity are being disrupted,...

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