If you’ve had your ear to the ground of the digital industry over the last few years, you’ve probably heard about the forthcoming deprecation of third-party cookies.
The move has been prompted by changing privacy regulations and an increased desire for more transparency about how internet users are tracked online. But what does it mean for the business of sport and, in particular, sports sponsorship strategies?
What are third-party cookies?
A cookie is a small text file that browsers store on a person’s computer when they’re using the internet. The file contains anonymous information about the person’s browsing habits, preferences and interests that can then be used to deliver a more personalized experience.
There are two primary kinds of cookies: first-party and third-party.
First-party cookies are placed on a browser directly by the site a person is visiting and are designed to provide a better experience. A first-party cookie file collects analytics data and might record language settings or log-in details, so the visitor doesn’t have to fill them in every time they use the site.
Third-party cookies are used for advertising. They’re created and placed by organizations that are neither the website owner nor the advertised brand (hence ‘third-party’). They track the user across the internet so if, for example, someone visits a streaming company’s site, the user might see an advert for that streamer, or a competitor, as they browse online.
Why are third-party cookies going away?
Third-party cookies are not necessarily bad, but many people don’t understand when or how they’re being used. In the United States, for example, a 2022 survey found that only 28% of adults felt they completely understood cookies. 24% said they didn’t understand at all.
This knowledge gap makes the informed consent that’s at the heart of privacy legislation like GDPR almost impossible to achieve. Without it, the online ecosystem becomes ethically ambiguous for lawmakers and publishers, incomprehensible for the public, and lacking in the trust, transparency and authenticity that’s so important for advertisers.
A privacy-first web, then, isn’t just an ethical necessity, but a critical requirement for the continued success of the internet as a platform for brands to connect with their audiences.
What does this mean for sports sponsorship?
Like all brands, anyone involved in sports sponsorship will be affected by the deprecation of third-party cookies. It’ll be harder for sponsoring brands to activate purely (or even primarily) through targeted advertising, and equally difficult for rights holders to do the same when promoting merchandise and tickets.
However, such challenges are not necessarily a crisis. Sports sponsorship is such a powerful platform because it meets people at their point of passion: their favourite player, team, or sport. The deprecation of third-party cookies will create an ecosystem of increased trust and transparency where rights holders and brands can further develop the authenticity that great partnerships are made of.
It just requires a shift in strategy.
First-party data has been integral to any marketing for years, but as third-party cookies recede, it’ll become even more important. A coherent strategy that puts the emphasis not only on the collection of first-party data but also on its increased analysis and usage will help transform sports sponsorship in the privacy-first age.
Here are just three ways anyone involved in sports sponsorship can revolutionize their approach to their first-party data.
- Organization. Vital audience intelligence can be generated by merging departmental datasets (merchandise, ticketing, app sign-ups, streamer sign-ups etc) into a unified, clean database. This process creates a single customer view (or, in this case, single fan view) that can be used to understand fans in more detail, helping rights holders demonstrate increased value to potential partners and brands activate with greater personalization and authenticity.
- Collaboration: Fear of leaks and breaches has made the prospect of rights holders and brands collaborating on first-party data too risky to consider. However, the emergence of data clean rooms and advanced encryption technologies has made the process much more secure. Collaborating on data helps sports sponsorship in two ways. First, potential partners can securely match their first-party data sets and understand how many fans/customers they share in common. This makes it much easier to understand any deal’s power, value and goals before it’s signed.
- Measurement: The second way is understanding the bottom line. By collaborating on first-party data during and after activation, partners can identify the number of fans who have become customers of the sponsoring brand. This creates a clear understanding of the most important metric of all – customer acquisition – and can be used to inform future deals and develop an idea of long-term customer value.
The deprecation of third-party cookies represents a seismic shift in the way rights owners and brands connect with sports fans, but the change doesn’t have to be difficult to make.
By building coherent first-party data strategies that put the focus as much on the secure organization and analysis of first-party data as the basic collection of it, sports partners can unlock key insights, create more transparent deals, and build more meaningful and authentic connections with fans.