First-party data takes spotlight, but cookies stay on marketers’ menu

In the rapidly evolving digital marketing landscape, the importance of first-party data has become more pronounced than ever. More than six months after Google’s decision to cancel the deprecation of third-party cookies, Indian marketers are now looking to prioritise first-party data, AI-driven audience segmentation, and contextual targeting to navigate a cookieless future effectively. This strategic shift is driven by the growing need for privacy-first solutions, enhanced consumer trust, and more personalised marketing strategies.

The decision by Google to maintain third-party cookies, albeit with changes to user privacy settings, has significant implications for the advertising industry. While third-party cookies will continue to play a role, publishers and advertisers are still exploring new monetisation models, such as subscription-based content and partnerships that leverage first-party data.

 This shift underscores the importance of building consumer trust through transparent data practices. Brands that clearly communicate the value exchange of sharing consumer data will gain a competitive edge by enhancing user experiences while maintaining compliance with evolving privacy regulations.

Gandharv Sachdeva, Country Head, India, Hybid, notes that the industry's move towards privacy-first solutions is driven by the need for effective yet compliant marketing strategies. “AI and ML offer an effective trade-off to third-party cookies by analyzing content contextually, ensuring brand safety, and optimising ad relevance,” he explains. This approach not only enhances audience engagement but also maintains compliance with stringent privacy regulations, ensuring that campaigns remain impactful without relying on third-party identifiers.

The rise of first-party data

First-party data, collected directly from consumers through interactions on owned channels like websites, apps, and social media, offers unparalleled insights into consumer behavior. It is gathered with user consent, ensuring compliance with privacy laws and providing a foundation for building trust with the audience. Ankur Gattani, Chief Growth Officer at WebEngage, highlights the obsession with first-party data among tech-first companies, particularly in e-commerce and data-to-consumer interfaces. “Fundamentally, all the channels of customer acquisition end up being expensive, so you want to retain and bring your existing customers back,” he emphasises. This focus on retention is driving even large FMCG companies to explore first-party data for insights and direct-to-consumer marketing strategies.

“Now, in fact, one fun part is we've seen large FMCG companies like even Cadbury and Britannia get very fascinated by the idea of capturing first-party data. Some of it would lead to direct-to-consumer branding and marketing campaigns, sometimes even e-commerce platforms. But a lot of it is to also do with insights and sometimes e-commerce-only products that they're not launching in the mainstream FMCG markets otherwise,” he says.

The integration of AI and machine learning further amplifies the importance of first-party data. By analysing consumer behavior and preferences, brands can tailor messaging that resonates with individual customers, leading to stronger engagement and higher conversion rates.

Rushabh R Thakkar, Founder and CEO of Frodoh, points out that despite Google's cancellation, Indian marketers have already moved on from third-party cookies. “Brands are building first-party data pipelines, CRM integrations, and direct consumer touchpoints to reduce reliance on third-party tracking,” he notes. This shift is supported by the growth of Retail Media Networks (RMNs) and privacy-led data collaborations.

First-party data allows for advanced retargeting and personalisation at scale. By understanding user behavior and preferences, brands can deliver targeted messaging that resonates with individual customers, leading to stronger engagement and higher conversion rates. This approach not only enhances campaign effectiveness but also fosters deeper customer relationships, which are crucial for long-term brand loyalty.

Moreover, the use of first-party data aligns with evolving consumer expectations and regulatory frameworks. In India, the Digital Personal Data Protection Act (DPDP) is set to enforce stricter compliance standards, emphasising the need for transparent and consent-driven data practices. Brands that prioritise first-party data are better positioned to navigate these regulatory changes while maintaining consumer trust.

Navigating the future of data-driven marketing

As the industry moves towards a cookieless future, brands are adopting innovative strategies to collect and activate first-party data. This includes encouraging site visitors to log in, offering loyalty programs, and gamifying interactions to incentivise data sharing.

Robin Thomas, Lead - Strategic Partnerships and Growth at White Rivers Media, emphasises the importance of transparency and direct consumer engagement in building trust. “Brands are increasingly centred on value-driven interactions, encouraging audiences to share preferences willingly through loyalty programmes, personalised content, or interactive platforms,” he explains. This movement aligns with India’s Digital Personal Data Protection framework, which has catalysed a surge in ethical data practices and consent management systems.

The integration of AI and machine learning in marketing strategies further enhances the value of first-party data. Large language models and predictive analytics require high-quality, bias-free data to generate actionable insights, making first-party data the gold standard for powering AI-driven marketing strategies. By leveraging AI, brands can refine customer segmentation, optimise ad targeting, and deliver more personalised experiences that drive customer loyalty.

In addition to AI, contextual targeting is experiencing a resurgence as brands seek to reach audiences without relying on third-party cookies. This approach involves analyzing the content context in which ads are displayed to ensure relevance and brand safety. Sachdeva highlights the effectiveness of contextual targeting in maintaining ad relevance while respecting user privacy. “AI-powered targeting will continue to drive impactful, data-secure campaigns without relying on third-party identifiers,” he notes.

The growth of Retail Media Networks (RMNs) is another significant trend in the shift towards first-party data. RMNs allow brands to leverage the first-party data of retailers to target consumers more effectively. This approach not only enhances ad relevance but also provides brands with valuable insights into consumer purchasing behavior, further enriching their first-party data assets.

Ethical data practices and consumer trust

As the industry navigates the complexities of data-driven marketing, ethical data practices have become paramount. Brands must prioritise transparency and consent in data collection, ensuring that consumers understand the value exchange of sharing their data. This approach not only builds trust but also fosters a more sustainable marketing ecosystem.

Thomas emphasises the importance of aligning marketing strategies with evolving consumer expectations. “India’s shift towards privacy-first marketing is a clear response to evolving consumer expectations,” he explains. By focusing on value-driven interactions and ethical data practices, brands can create more personalised and trustworthy experiences that resonate with their audience.

“We see most marketers taking their first-party data a lot more seriously compared to what they've done historically. But, how do you ingest it, absorb it, make it meaningful, unify, take action upon it? That's still a long journey for a lot of these brands, says Gattani, adding, “I think cookies still remain very, very important and interesting from a lens of retargeting because all the brands that are getting a certain amount of traffic on their platforms still want to make sure they're able to get the same people buying share across wherever they are on the internet. So for now, I don't see that going anywhere.”

Despite the cancellation in third-party cookie deprecation then, the pivot towards first-party data remains a strategic imperative for brands. By focusing on consent-driven, transparent data collection, businesses can build stronger relationships with their audience, deliver more personalised experiences, and maintain compliance with evolving privacy standards.