First-party data gives marketers a firsthand experience with their customers. When harnessed correctly, marketers can stay close to consumers by using first-hand customer-brand experiences to power unbeatable campaigns that resonate with the customer’s at-the-moment desires.
When marketing messages are fueled by first-party data, every touchpoint becomes a true conversation that moves the customer closer to lifetime loyalty.
But first thing’s first—marketers need to understand what first-party data is, why it matters, and how to use it. Here, get an in-depth view on all things first-party data and start generating the campaigns that pop up first in customers’ minds.
- Introduction
- What is First-Party Data? (Definition)
- What Makes First-Party Data the Smartest Option?
- How Do Brands Collect First-Party Data?
- How Do Brands Activate First-Party Data?
- First-Party Data At Its Best
What is First-Party Data?
First-party data is the information brands get straight from the source. Whenever a customer interacts with a brand of their own volition—such as browsing products, opting into marketing communications, or leaving a question in the chat box—they’re producing first-party data. This information is owned by the host company.
Think of a new customer on a brand’s mobile site. A recently arrived sweater catches her eye as she scrolls, but her size is out of stock. Determined to snag the coveted item, she opts into brand communications for restock notifications, adding her name and email into the pop-up.
These movements on the brand’s site all contribute to first-party data. Her unique data trail alerts the brand as to what’s already attracting her attention, influencing the follow-up content, products, and messaging she receives.
First-party data is accurate, trust-worthy, and from a source you know matters to your business—your already interested customers and prospects.
But how do other forms of data come into play? Here’s a quick summary of how alternative data sources can support the first data point of contact.
Second-Party Data
When brands want a quick influx of first-party data, they can opt to buy it from another source. This commodified first-party data is known as second-party data.
Take a furniture company that’s opening up a new location in the downtown core. They can buy first-party data from companies that have data on the housing market to tailor what kind of furniture to market to local customers. If they’re surrounded by apartment buildings, they recommend cheaper, space-saving pieces; If they’re near expensive neighborhoods, they’ll promote extravagant pieces with a higher price point. Here, second-party data from a related industry gives marketers the information they need to send the messaging that resonates most.
It’s a fast fix when brands want data points, but second–party is not the most sustainable option; the price tag can grow costly over time, and it’s still only first-runner up in its accuracy.
Third-Party Data
Third-party data is information that large data aggregators segment, organize, and sell to brands. With the rise of privacy restrictions and the cookie-less future, over 40% of marketers are boosting their email personalization software in lieu of third-party data sources.
But third-party data was never meant to be the one source of truth for stable brands—its best use is to fill in the gaps for existing customer interactions that aren’t producing enough data points. If brands want to convert a casual prospect into a loyal customer, they may turn to third-party aggregates to fill in that missing information with data from similar consumers.
But third-party data cannot stand alone. Its accuracy is often shaky due to the fast aging of data, and its information is sellable to anyone, failing to give any one brand a leg up on the competition.
Zero-Party Data
First- and zero-party data are as important to each other as 1 and 0 in binary code. Closely linked to first-party, zero-party data is the information that customers voluntarily give to a company with the expectation of value in return.
Zero-party data Is a subset of first-party data, as both forms of data come from direct interactions with the brand. Think back to that first shopper. When she’s browsing for sweaters, that’s first-party data; when she fills out the pop-up suggesting restock notifications, that’s zero-party data.
Marketers have various forms of customer information at their disposal and can activate every type at opportune moments for a strategic outcome. But while second- and third-party data can have its uses, first-party data—and its subsets—is the most powerful and sustainable option for brands to rely on as their star player. Here are four reasons why:
What Makes First-Party Data the Smartest Option?
First-party data must be the information leader of your marketing strategy. It’s the intimate source of key customer information that powers unmatched data-driven results:
First-hand Information
There’s a reason a round of broken telephone leads to outlandish results; the further the information gets from the source, the less accurate it becomes, leading to laughable phrases.
So why do marketers think data will behave any differently? The closer marketers stay to the source—their customers—the more accurate their marketing strategy will be.
With first-hand information, customers show marketers exactly what they want. Without first-party data, marketers will be creating messaging and content built on off-base information for people that aren’t in their target customer group.
Clear Value Exchange
No one likes mixed messages. Customers want what they’re promised and 44% of them will walk away from anything less.
If brands are promising personalized messaging and telling customers how much they care while deploying generic batch-sends that don’t serve customers’ needs and preferences, they’ll be quick to walk away.
When brands use first-party data, they are opening up the lines of communication, helping customers be seen and heard, and truly delivering on their promise of personalized messaging that generates the best experience possible.
Target with Precision
Over 70% of customers expect sophisticated personalization in their brand messaging. For personalization, you need the right data—namely, first-party data.
Second- and third-party data are simply not precise enough to power messaging that fosters a 1:1 connection with a customer. For both of these forms of data, their indirect nature means they can only speak to shoppers similar to your customers—not your customers.
The time is now to speak directly to your customers and personalize with precision.
Omni-Channel Access
First-party data is the bedrock of every mature omni-channel personalization strategy. These days, to stay at the forefront of customers’ minds requires maximal touchpoints.
No matter where they're found—whether that be on mobile, email, or browsers—it’s a necessity for brands to produce equal sophistication and cohesive messaging.
First-party data is the route to omni-channel success, as it’s the key source of customer data that’s present on every platform. Unlike second- and third-party data, a customer’s first-party data trail will give marketers insight no matter the device. It truly is the one-source-of-truth that marketers would be wise to leverage in their omni-channel strategies.
How Do Brands Collect First-Party Data?
First-party data is clearly priority number one when it comes to data-driven marketing. So how are brands to collect, analyze, and use it to its full potential? Begin with looking at your brand’s online presence and finding the mainstem of your data:
Website
Your website is the heart of your brand’s online presence, and it should be the first stop in gathering need-to-know data. With the power of behavioral tracking pixels, marketers can note what items are catching customers’ eyes, what pages they’re staying on, and what’s missing in the brand experience.
From there, brands can send retargeting messaging based on customers’ latest behaviors, as well as use web crop tools to showcase the show-stopping spots on the site.
Mobile App
Customers spend more time on their phones than ever, making mobile personalization a key tool in gathering first-party data. The cherry on top? Customers who’ve already downloaded the brand’s app are low-hanging fruit in the loyalty game.
These customers have already shown a marked interest in the brand, and are more likely to convert into brand loyalists than anyone else. The tipping point to get them there? Retargeted content that’s built from their direct behavior with the brand’s app.
Marketing Communications
Marketing communications are a brand’s direct line into conversation with a customer—those conversations matter, and how customers respond to your omni-channel messages will give great insight into their most specific preferences.
Similar to the mobile app, customers who’ve opted into marketing communications have already shown a level of commitment to the brand. Use email and mobile messaging as the springboard for gathering first-party data: gather the data from initial sends, retarget, generate more interaction, and keep the data-collection party going.
Offline Sources
With first-party data, it’s key to remember every source, even those offline. Do not silo online behavior from one-on-one conversations at call centers or long-standing information from CRMs. Marketers need to integrate all of their data-producing channels and form a cohesive one-source-of-truth for agile marketing that uses the freshest first-party data.
Every brand touchpoint, whether online or off, is a source of first-party data; no channel is too insignificant to ignore and no channel is too powerful to not need a fine tooth comb.
Chances are, you’ve already got these sources at your fingertips. Now explore how to activate them.
How Do Brands Activate First-Party Data?
Most brands have mountains of data at their disposal. The challenge often lies in finding the key information—prioritizing first-party data—and using it at scale. Even with the highest quality data, if brands don’t have the bandwidth to quickly translate it into engaging marketing messaging, its value quickly decreases.
In all of the following methods to activate first-party data, the foundation is automation. No matter the size or focus of the brand, the key is automating highly relevant messaging by streamlining your workflow.
Supercharge Your Segments
Segments can be powerful, but only if they are customized to your brand. If a brand relies on pre-packaged information they buy from a third-party data aggregate, the segments won’t completely fit their existing customers and target prospects.
For hand-in-glove segments that truly represent your customer base, first-party data is a necessity. When you build segments, use first-party data to narrow the focus of existing segments and create new ones that are specific to your brand.
That can seem like a daunting process, but the payoff is worth it; when brands make customers feel like their one and only, customers respond with requisite loyalty.
Be a First Responder
Data ages quickly. Brands need an agile process that leverages automation to collect and activate data while it still rings true for customers.
Picture a customer on the hunt for a new pair of hiking boots. If the brand responds quickly with product recommendations that delight the customer, they’ll succeed both in guaranteeing a purchase and in building lasting camaraderie with their customers. On the other hand, if a brand is too slow to respond, it doesn’t matter how perfect their product recommendation is—the customer will already have bought hiking boots from another brand, making the well-targeted brand communications irrelevant.
Map Out the Customer-Brand Journey
Brands must do more than simply respond to customers after they make the first move. Brands need to be proactive in their marketing messaging and take the lead.
Map out the customer journey and use first-party data to understand where they are and see where they’re heading. Every customer has an ideal path, and it’s the job of the brand to send the messaging that leads them to the optimal customer journey.
Keep an Eye On What's Working
First-party data gives you insight into customers’ preferences and needs at the moment. But true to what all marketers know, customers are constantly evolving and their expectations unfailingly increase.
To best use first-party data, brands need to continually capture and activate it—it’s a cycle that can never stop if brands are to consistently give customers the relevant experiences they crave. There’s always something new to learn about a customer, and marketers need to always be on the lookout to learn.
First-Party Data at its Best
A picture is worth a thousand words. To truly understand the power of first-party data, take a look at these relevant, personalized campaigns that are powered by customers’ most important data.
Here, Inkredible Retail uses first-party data to power their behavioral targeting. The brand notes the customer’s browsing patterns and lends her a helping hand to find the right pillow to ensure sweet dreams. As an added bonus, related products are suggested to finish off the bedroom set.
As seen in the personalized hero image, Jill is clearly a customer that is already on the email list, meaning that she’s already shared some key information as a show of commitment.
Some data—such as name, address, and email—is more evergreen than others, and Inkredible Retail uses that reliable information to suggest the nearest store that has her high-interest item in stock. In a winning combination of evergreen data and the latest first-party data, Jill receives an email that’s relevant, engaging, and genuinely helpful.
In this mobile example, Inkredible Retail sends a push notification to remind Julio of the item that last caught his eye. Not only does the brand remind the customer of the product, they also have the correct color and size included in the notification, making purchasing easier than ever. For added urgency, the brand alerts the customer to plummeting inventory, inspiring quick action to snag the product before it's gone.
While data can age quickly, the right tech stack and tracking pixel can again differentiate which information has more staying power—such as shoe size—and what first-party data needs to be activated immediately, such as the item itself.
In this last example, Inkredible Media makes an intelligent inference from the customer’s first-party data trail. Based on shows that the viewer has already watched, the brand suggests similar titles that are sure to inspire the inner chef in their customer.
In all of these powerful first-party data examples, two key pillars are apparent: quality data and the right tools to turn that data into content. Both are equally important; customers need an experience in their marketing messaging that’s immediately eye-catching and engaging, and it needs to relay the information that’s unique and true to them.
With the duo of first-party data and personalized content generation, any brand can take first place in a customer’s heart. Understand your customers in the moment and build a relationship with them that lasts for a lifetime.
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