For a couple of years now, there’s been talk but - until the start of this year - not much action on the phasing out of third-party cookies. You know - those things responsible for you getting streams of targeted ads for similar products after you spend time on e-commerce sites. Well, the time is finally here for the phase-out.

Google Chrome, with 65% of web-browser traffic, along with other major browsers, have begun the crack-down, impacting brands abilities to track user behaviour across various sites, and the effectiveness of how brands can re-target customers with personalised offerings.  So we asked ourselves - who wins and loses in a world with more restrictions on cookies?

Before we get into that, a few definitions for those who haven’t been obsessing about such things:

What is zero-party data?

• When travellers willingly share information about their preferences directly with travel brands such as hotels, typically through surveys, preference sheets or similar.

What is first-party data?

• Data collected online directly from travellers, through interactions and transactions during the discovery and booking journey.

What is second-party data?

• Information shared between trusted partners or affiliates to understand guest preferences and deliver complimentary products/services that resonate with a guest’s interests.

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Why are browsers phasing out third-party cookies?

While third-party cookies offer some convenience for consumers, like remembering past purchases on e-commerce sites, they come at a cost: user privacy. Consumers are becoming more privacy-conscious, and they expect greater control over their online data. This shift coincides with stricter regulations like GDPR, which limit how companies can collect and use data. As a result, technology is changing, and advertisers are finding it harder to rely on third-party cookies for tracking purposes.

The need for tighter controls is emphasized by the fact that 92.6% of websites track user devices before obtaining consent. This statistic highlights the prevalence of intrusive data collection practices that are driving legislative changes.

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The travel industries winners and losers from phased-out third-party cookies:

OTA’s and consumer-facing travel brands brands; the likely losers in customer acquisition for their core product

One significant challenge with the demise of third-party cookies is the impact on retargeting strategies. These cookies allowed for highly personalized ad campaigns based on individual user behaviour across the internet. In the new landscape, advertisers will need to adapt to a less granular approach. Targeting will move towards a grouping or cohort approach based on broader categories of search queries and website interactions, likely making retargeting campaigns less precise and potentially decreasing their effectiveness. So whether this is for transport, accommodation, experiences etc. the ability to piggyback on customer intent to drive traffic will diminish.

Increased marketing costs to drive direct traffic

In the experiences vertical specifically, the major OTA’s struggle with low brand awareness and limited direct traffic. As we’ve seen over the last few years, the front-runners Get Your Guide and Viator have invested heavily in marketing campaigns in efforts to combat this, and build a large and loyal customer base. Their pursuit for repeat custom and organic traffic becomes even more important as their ability to re-target browsers with specific offerings declines.

More demand for PPC?

With the limitations on retargeting, the emphasis might shift even further to PPC advertising (pay-per-click). OTA’s already rely heavily on PPC, Spending as much as 50% of revenue on performance marketing, with those in the tours and activities vertical spending around $50 per customer acquisition. As retargeting based on browser behaviour on competitor sites becomes less feasible, the demand for effective PPC campaigns and acquiring customers from Google could rise even further.

Travel brands, with an abundance of zero and first-party data; the likely winners.

The first-party data that travel brands like hotels and airlines already own becomes even more valuable! They own crucial data, inaccessible to B2C OTA’s, that enables effective ancillary offerings.

These travel brands, by nature, have an abundance of first-party data that’s incredibly valuable in delivering personalised ancillary offerings. Whether it’s a hotel, airline, OTA or other another brand, they hold data points that are instrumental in effectively selling experiences. None less than knowing the exact dates of travel, as reaching the customer in-destination, when +50% of experiences are booked, is one small but significant step to enhancing existing cross-sell approaches. Juxtaposing conventional approaches that deliver experiences offerings in line with transport or accommodation, with a significantly different booking window.

Where this data set becomes richer is through loyalty programs, repeat bookings, and the brands that already collect zero-party data in the form of consumer preferences, that shed huge light on the experiences a traveller is likely to book. Understanding a customers intent when they might be travelling for business or leisure, with friends or family, will significantly impact the experiences they are likely to book.

Leveraging this data enables the travel brand, to deliver an offering that truly resonates with travellers - which makes booking through them, the obvious choice. First-party data (that B2C OTA’s for experiences don’t have access to) allows for a significant amount of personalisation, a more compelling e-commerce experience, and a more efficient product discovery for finding an experience they will actually book.

We’re helping travel brands turn zero and first-party data, into repeatable revenue, through highly personalised experience recommendations. Get in touch if you’re interested to find out more!