CMO and CCO
Over the last year and a half, there’s been one story that has kept senior executives at travel brands up all night: the COVID-19 pandemic.
The virus has forced airlines to close operations, lay off staff, and suspend travel to entire regions as countries close their borders to foreign travelers.
In fact, the disruption caused by COVID-19 has been so severe that the World Travel and Tourism Council has warned that the pandemic could put 50 million jobs in the travel and tourism industry at risk.
However, while the pandemic might seem like the only issue that should worry airline and hotel business leaders, there is another ongoing story that could further derail the industry: the death of the third-party cookie.
The importance of third-party cookies
Since the first banner ad in 1995, travel marketers have relied on third-party cookies to fuel digital marketing campaigns.
Tracking consumers from website to website across the web, third-party cookies inform marketing strategies and allow airlines and hotels to create highly personalized marketing communications based on user patterns and behavior.
Concerns around user privacy, however, have led to tech companies cracking down on their use.
Apple launched its Intelligent Tracking Prevention (ITP) in 2017, Firefox launched its Enhanced Tracking Protection (ETP) in September 2019, and earlier this year, Google followed suit by announcing that it would phase out third-party cookies on its Chrome browser by 2023 – a two-year delay from its previous announcement in 2018.
Moreover, Apple has also tightened the parameters for how data is shared on iPhones, by changing its tracking on iOS to ask people to opt-in to data sharing.
While seemingly minor in comparison to the pandemic, the death of the third-party cookie has serious implications for the travel industry.
For example, airlines and hotels currently use third-party cookies for measurement, attribution and the all-important task of personalization.
With customers coming to expect personalized content as the baseline in most communication, the loss of third-party cookies could put travel brands at a disadvantage, and make it harder to send the most relevant promotions to the right customer at the right time – resulting in a loss of sales and revenue.
Utilizing first-party data
There are a number of alternatives that travel brands can take in filling the gap left by third-party cookies. Firstly, they can utilize the data that they already have.
Airlines and hotels currently sit upon a wealth of first-party data such as online shopping activity, booking propensity and digital device affinity, which could be used to greater effect.
However, for most brands, this won’t be enough. First-party data on its own and without external sources won’t give airlines and hotels enough insight to personalize messages to customers, as the data can only show how a customer interacts with one given brand.
In other words, brands using first-party data don’t have an overall view on how a customer engages with certain products and services.
Take, for example, an airline that has a customer on its rewards program. If it also knows how that person interacts with hotels, spas, restaurants, concert venues – it can get a true idea of what motivates them to travel and which offers or messages might appeal.
For example, a person who loves to splash out on a spa day when they travel may well be a good recipient for a push around wellness-based rewards. This is one small point around how a wider understanding of someone can enable both brand and customer to get the most out of the relationship.
Secondly, travel brands might try walled gardens like Facebook and Google to fill the gap left by third-party cookies. Both giants have an array of data that can help airlines and hotels reach the right audience with the right message.
While these platforms can help travel brands fill the void left by the third-party cookie, there are limitations in using Facebook and Google. Namely, each platform only enables brands to reach those audiences within that platform.
In other words, you can’t use data from Facebook and Google in other external processes. This means that travel brands can’t use their data across owned channels, the open web and more.
Adopting a privacy-centric approach
Thirdly, travel marketers can enter into data partnerships in order to provide them with a rich supply of external first-party data from an ecosystem of brands. Following increased scrutiny into data privacy from the public and politicians, these partnerships should be privacy-centric.
Travel brands can do this by entering into partnerships that tokenize first-party data with external brands so that personal identifiers (name, age, location) aren’t given to outside parties and that partner brands are able to access the necessary insights into customers.
The benefit of data partnerships is that they provide brands with flexibility. For example, travel brands can take a series of data points and layer them on top of first-party data in a number of different ways – depending on the type of customer that they’re aiming to reach.
This means that digital marketing strategies are tailored to the objectives and goals that travel marketers are striving for.
Even though the final nail in the coffin of the cookie is two years out, it’s clear that travel brands need to prepare for the change now.
If travel brands don’t start laying out the groundwork now then they will lose out to competitors who are using data partnerships in order to send tailored marketing messages that drive sales and put them top of mind for customers.