Today’s successful marketing relies heavily on data. But there are different types of data available, and is it so critical to comprehend the many forms of data. Marketers can benefit from data. However, whatever types of data will benefit you the most is dependent on your current situation and marketing objectives.
What is First Party Data?
Data collected directly from your audience or consumers are referred to as first party data. It comprises the following:
- Data from your website(s) or app(s) that displays behaviors, actions, or interests.
- Data in your CRM
- Data from subscriptions
- Social data
Non-online data, such as completed surveys, customer comments, and other customer information recorded in your CRM database, can also be included.
The most useful type of data is first-party data, which comes directly from your audience and consumers. It is not only the most valuable, but it is also the most cost-effective because it is free. It’s also simple to gather and manage, particularly if you use data management software. First-party data raises little privacy concerns because you know precisely where it comes from and, as a marketer, you own it fully.
The king of data is first-party data. Any corporation that does not gather and activate 1st party data from their properties is essentially throwing money away. Taking ownership of first-party data should be a top goal for every company today that wants to monetize, learn from, and use the asset to grow valuable audiences, gather customer feedback, deepen consumer engagement, and boost ROI across marketing activities. 1st-party data is a helpful customer data platform.
How can Marketers benefit from First-Party Data?
Because of its excellent quality, first-party data is extremely useful. You know it’s factual because you got it straight from the source, and you know it’s important to your business since it came from your audience.
Another advantage of first-party data is that privacy concerns are minimized because you know precisely where it came from and you own it as the marketer that gathered it from your audience. Because first-party data is of such high quality, marketers have a wide range of alternatives for how to use it. 1st-party data is also one of the best data management platforms.
- Predicting Future Trends: Because of the precision and relevancy of 1st party data, you may confidently forecast future patterns, such as audience behavior. If you’re a marketer and your data shows that a specific customer has been browsing pages about buying basketball shoes and has placed a pair in their shopping cart, you can assume they’ll buy basketball shoes in the future. If, on the other hand, your audience rarely clicks on banner advertisements but frequently engages with video commercials, you can be confident that they prefer video ads and will continue to do so in the future. With this insight, you can choose advertising that is more appealing to your target demographic.
- Get to know your audience: Even if your audience is limited, first-party data can provide you with useful and valuable insights. You can look through your data for common attributes among your consumers and expand that initial audience to include additional customers who share those traits. You may broaden your audience, gain new insights, and increase your business.
- Personalize Content and Ads: You can also use first-party data to tailor the content. 1st-party data can be used for targeted advertising as well. The information you gather about a website user can help you gain a better understanding of their interests and needs, allowing you to provide customized content to them. Assume you have a number of promotional videos on various topics that you’d like to share with potential customers as part of your inbound marketing plan.
How to collect First-Party Data?
You activate a pixel on your website to collect first-party data. The tool gets data about your site’s users’ activities from a variety of sources, including an integrated data management platform, or DMP.
You can also pull information from other databases, such as customer relationship management (CRM) systems. Customers may also provide information when they subscribe to your email list or make a purchase on your website. You can “onboard” the data to bring these offline customer data platforms online, which is a service that links your offline data to online cookies or mobile IDs.
If you have a data management plan, you may utilize it to consolidate data from numerous sources into one area. Once you’ve gathered all of the data, you’ll be able to organize, analyze, and activate it all at once for a complete picture of your customers.
What are Zero-Party, Second-Party, and Third-Party Data?
Zero-Party data: For a long time, we’ve been discussing first-party data. But there’s a new valuable data type that’s getting a lot of attention: zero-party data. Unfortunately, zero-party data is perplexing since, in many ways, it is identical to first-party data.
Data that a customer voluntarily supplies, such as communication preferences or the types of information they want to receive, is an example of zero-party data. Another example is when a customer expresses an interest in something specific, such as craft beer, products for infants, or things to do on road trips.
Because zero-party data is a component of first-party data, it must adhere to all of the regulations that govern its management. It also has the same advantages as other types of data, such as allowing you to build personalized, relevant experiences.
Second-Party data: Data obtained from a trusted partner is referred to as second-party data. In the vast majority of cases, you are familiar with the partner, which implies you are familiar with the data quality, data strategy, and accuracy. You also know the information is relevant because it comes from a partner with whom you have a good working relationship.
Moreover, your partner complies with privacy laws such as the GDPR and the CCPA, so you can rest assured that the data was acquired with the consent of the dataset’s consumers. You can also buy second-party data by using data markets to connect with partners. When you obtain data in this manner, you can debate it with your spouse and choose only the facts you require.
Using second-party data has a number of advantages:
- It allows you to grow by engaging with new audiences who have similar demographics to your own.
- You can use it in conjunction with your own data to improve your predictive models. This is especially true if you don’t have a large number of consumers to build predictive models from.
- By evaluating a larger audience group, you can get greater audience insights. Combining your first-party data with third-party data may enable you to discover new ways to reach out to your current audience or discover new audiences to reach out to.
Third-Party Data: Data from a data aggregator is referred to as third-party data. Data aggregators don’t collect data themselves; instead, they obtain it from other businesses and combine it into a single dataset. As a result, data might originate from a variety of sources, some major and some tiny, and there isn’t always a clear description of who the data belongs.
For advertising, the majority of 3rd party data is purchased through a DSP (demand side platform) or a DMP (data management platform). Acxiom, Nielsen, Google, and OnAudience are just a few examples of third-party data marketplaces.
You could want to buy 3rd party data for a variety of reasons:
- Third-party data allows you to reach a larger audience with your advertising campaigns.
- Third-party data can assist you to improve targeting when combined with your first-party data.
Programmatically, 3rd party data is bought and sold, and it’s usually very huge data providers. The major issue with 3rd party data is that you don’t know where it comes from, therefore you can’t guarantee the correctness or reliability of the same data. You also have no way of knowing if it was obtained in accordance with privacy laws. As a result, before choosing a 3rd party data source, do your homework and learn where and how the data points were gathered.
How can brands use first-party data to generate customized SMS experiences?
Customer experience is one of today’s most difficult problems for marketers. Every interaction with a brand generates a stream of data about the consumer’s wants, requirements, and preferences. In exchange, people expect companies to give relevant and tailored experiences across all channels, or they will seek alternatives.
Audience data is no longer voluntary. It is crucial to the success of marketers. For many years, businesses have depended significantly on 3rd party data to inform their marketing tactics.