The Privacy-Personalization Balancing Act

Two accelerating trends in marketing are on a collision course. Consumers want — and deserve — more consent and control over their data identities. Yet shifts in consumer behaviors and expectations for increased personalization are causing companies to reassess their ability to leverage that data.

Privacy and personalization aren’t necessarily at odds

In 2024, Google began deprecating third-party cookies on Chrome after years of delays, disabling them for 1% of total traffic in January, with a plan to ramp that up to 100% of users by the end of September. This is in direct response to tensions brought on by unprecedented increases in privacy regulation at the state level. Those standing idly by, ignoring these monumental shifts on both the government and business sides of the equation, do so at their own peril. Meanwhile, the companies doing the hard work of proactively addressing privacy expectations and consent requirements — while simultaneously investing in more personalized, relevant experiences — are gaining the edge.

Easier said than done

Navigating regulatory waters requires a new skill set that a growing number of companies don’t have. While the intent is there, companies sometimes lack the regulatory know-how to operationalize this evolution. Unfortunately, this is even more common among natively digital organizations, many of which lack the required expertise to implement effective governance models that allow for secure sourcing, organizing and utilization of data streams necessary for people-based marketing.

Experienced companies create operational forcing functions that help maintain compliance without stifling innovation, positioning themselves for success. These companies will show the rest of the market the most viable path as privacy and personalization converge.

What’s old is new again

With the complete deprecation of the third-party cookie fast approaching, there have been some arguments swirling that suggest the best answer is in the past—going back to a world before people-based media and marketing investments were introduced. But this doesn't necessarily serve anyone’s needs, least of all consumers'.

Reverting to only contextual signals or dialing back on data-driven initiatives won’t deliver on the relevancy expectations of today’s consumer. But given the rapid proliferation of new privacy laws in the US (and around the world), it's clear that the path forward is not backward, now is the time to invest in what you need to meet the market’s new requirements.

These investments should take many forms, such as formalizing evaluation and validation exercises to vet data compliance and accuracy, solving for data silos to create a unified view of consumers, building out a robust compliance team and budgeting for the technology necessary to implement these new skills.

Identity comes into focus

Organizations are focusing data investments on the pursuit of a holistic cross-channel understanding of peoples’ and households’ data identities — in fact, US spend on identity solutions topped $10.4B in 2023. But understanding and resolving identity requires personally identifiable information, potentially causing heartburn for those new to directly handling this type of data.

It makes sense then that most media companies and ad tech and martech providers have chosen to stay away from directly handling consumer data. But those same companies know this: Without partners that directly manage consumer data supporting them, they’d be in trouble.

The good news? Data stewardship, along with responsible and ethical data practices, exists in the marketplace. These practices force us to lean forward, ask tough questions of our partners and providers, and bring more rigor to internal evaluations and processes along the way.

Consumers in full view

Today’s marketing landscape is one of paradox: Consumers crave more relevant and personalized advertising messages, while at the same time growing increasingly concerned about the security and privacy of their personal data. These high expectations create even higher stakes for marketers working to avoid getting this wrong. 

But as challenging as this may appear, it’s not impossible. With forward looking consumer identity and a thoughtful approach to technology investment, marketers can walk the privacy and personalization tightrope and continue to surprise and delight their customers in engaging — and compliant — ways in 2024 and beyond.

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