The Rise of Transaction Data in a Cookie-less World

13 March 2024

As third-party cookies phase out, transaction data emerges as a key player in digital marketing. Dive into how this shift offers deeper consumer insights, maintains privacy, and enhances targeting.
Man paying with contactless credit card for coffee in cafe. Credit card transaction.

Goodbye to Third-Party Cookies

Third-party cookies are set to disappear. These tiny yet powerful pieces of code have allowed marketers to track and understand users’ browsing activities across different websites. Over the past two decades, third-party cookies have played a central role in powering personalization in digital advertising campaigns. But as privacy becomes a paramount concern, the phasing out of third-party cookies is shaking up the advertising industry.

Many browsers, such as Safari and Firefox, have already banned the use of third-party cookies. In 2024, Google Chrome will also be 100% free of third-party cookies. Given Chrome controls roughly 60% of the global web browsing traffic, the advertising industry now faces a critical turning point.

In the absence of third-party cookies, marketers face challenges in collecting and utilizing data for insights. This shift is leading to less accurate targeting, impacting the effectiveness and ROI of marketing budgets.
Faced with this new reality, marketers are looking for new ways to understand customers and personalize experiences.

Transaction data: an untapped alternative

Transaction data – the records of what consumers purchase – is becoming an enticing alternative when marketers can’t target ads based on browsing history. Many businesses are still not fully utilizing the wealth of insights that transaction data can offer.

Payment networks like Visa and Mastercard process billions of transactions annually, accumulating vast amounts of data. This data offers deep insights into consumers spending patterns across various industries and regions.

While transaction data might not provide the same breadth of insights as third-party cookies, it brings its own unique advantages:

  • Privacy & Explicit Consent: While customers can be segmented according to their spending behaviours, customer’s privacy is maintained. Merchants can’t see transaction data associated with a specific card or cardholder names. In Card-Linked Offer (CLO) programs, the explicit consent from cardholders is obtained, typically at the point of program enrollment or when the customer first links their card to the program. Cardholders can also opt-in or opt-out of a more personalized experience that considers their transaction trail.
  • Rich Source of Information: Transaction data provides detailed insights into consumer spending behaviors, preferences, and trends. This information is invaluable for understanding customer habits and tailoring marketing strategies accordingly.
  • Personalized Customer Experience: By leveraging transaction data, businesses can offer more personalized and relevant offers, discounts, and rewards, increasing the overall customer retention and lifetime value.
  • Direct Attribution: One of the key advantages of transaction data is the ability to directly attribute sales to specific marketing efforts. Unlike data inferred from browsing habits (purchase intent), transaction data reflects actual consumer action/conversion (purchase).
  • Competitive Advantage across various industries: Many businesses are still not fully utilizing the wealth of insights that transaction data can offer. In addition, the use of transaction data isn’t limited to retail; it can be leveraged across various sectors, including finance, hospitality, and travel, among others, for deeper customer insights. Those who do tap into this resource effectively can gain a significant competitive advantage.

Transaction data will not fully replace the broad range of behavioral insights provided by websites and digital channels. Marketers will still need to combine the use of different sources to keep building robust data-driven strategies.

However, the transition to a post-cookie era will accelerate the shift towards more privacy-conscious marketing solutions while still delivering an optimal experience for consumers.

Card-linked offers: Personalization & Privacy

By leveraging transaction data, card-linked offers stand at the forefront of this change and are gaining traction amongst marketers. Over 15% of marketers allocated between 30-50% of their budget to CLO programs, according to the Digital Commerce Annual Study. CLO is rapidly establishing itself as a distinct marketing channel, competing for budgets alongside more traditional avenues like social media and SEO.

CLO offer a great balance of precise targeting, enhanced personalization, and a trust-based customer relationship. For more information, read our article on the potential of Card-Linked Offers engagement