In the ever-changing landscape of digital marketing best practices, from second-party cookie deprecation to GDPR privacy compliance, first-party data collection and utilisation remains a cornerstone in the industry for successful digital marketing strategies.
If you’re looking to better understand first-party data, why it’s important for paid media campaigns and how to use it, we’ve outlined the key points in this article.
What is first-party data?
So, what is first-party data and why is it important?
Essentially, the meaning of first-party data is information that is collected by a business directly from customers, rather than through external platforms or data providers.
Examples of what is considered first-party data:
- Contact information (such as phone numbers, email addresses, names)
- Demographic data (age, gender, location)
- Purchase behaviours and history (products purchased and cost of purchases)
- Interests based on social media data (hobbies, topics, brands)
- Online behaviours collected through visiting a company’s website (pages visited, time spent onsite, event triggers such as filling in a form or adding an item to the shopping cart)
Because this information is collected directly from a brand’s audience, it is considered highly relevant and more valuable to marketing initiatives than other types of data. You can understand how your target audience behaves, what channels they use and what drives them to act.
First-party data is also more compliant, as it is gathered directly from users within a company’s privacy and data framework (if implemented correctly).
The only thing to keep in mind with first-party data is that it is a representation of your current audience, but it can be limited in providing insight into new audiences that you haven’t engaged yet.
How is first-party data collected?
First-party data can be collected in a variety of ways, like using Google Analytics to track website data, or an in-platform lead form on a social media ad or when someone makes an online purchase.
Examples of first-party data collection include:
- Newsletter subscriber forms
- Setting up GDPR-compliant website tracking (e.g. Google Analytics)
- Using call-tracking software (e.g. Infinity)
- Implementing pixels and tags from marketing platforms (e.g. Meta pixel)
- Account creation to be able to purchase online
- Surveys
- Customer feedback forms
Other types of data
First-party data is a hugely valuable resource for marketers, but it’s not the only data type available. In this section, we explore other data types and how they differ from first-party data.
What is the difference between first-party data and second-party data?
It is important to clarify that the difference between first-party data and second-party data is not the type of information itself, but how it is collected in relation to a specific brand or website.
For example, one company’s first-party data would be second-party data if sold or provided to another company. This can be done through a collaborative agreement to widen data pools and for audience segmentation.
The main drawback with second-party data is that there can sometimes be integration issues with your own data management platforms.
What is third-party data?
Third-party data is information that can be purchased from a broker or company that is not involved with the data collection. These brokers typically aggregate large data sets from multiple sources or websites to create audience segments which can be used by advertisers. Examples of third-party data providers are Acxiom, Experian and Audience Q.
Whilst third-party data has its place in digital marketing strategies to expand prospecting initiatives, there are a few drawbacks which are important to consider. You often won’t get insight into how this data is collected or the accuracy of this data. Also, your competitors are free to purchase the same datasets that you’re using, so it may not be offering you an advantage.
What is zero-party data?
This term is sometimes used when discussing the different types of data, but it is a subsect of first-party data. Put simply zero-party data is information that is willingly provided by a customer to a website or brand, usually in exchange for something.
Examples of zero-party data could be information collected from customer feedback forms, surveys or quizzes.
Why is first-party data important in digital marketing?
There are three core reasons why first-party data is essential for digital marketing initiatives, now even more than ever.
Deprecation of second-party cookies
Although Google has flip flopped around deprecating the cookie, the long-term plan is that these will not be available for marketing purposes and Safari and Firefox have already axed cookies. In some cases, this can impact cross-channel attribution and remarketing efforts.
First-party cookies and data collection aren’t facing the same risks, so embracing these types of data collection will future-proof your digital marketing strategies.
User privacy and GDPR compliance
When it comes to website analytics, users are becoming more conscientious about cookie usage and their privacy options. With an estimated average cookie acceptance rate of 31%, it’s quite likely brands aren’t collecting the majority of available data. Whilst some analytics platforms are adjusting to this using modelling, advertisers should be using all avenues of first-party data collection available to them (e.g. subscriptions, call tracking) to further optimise their digital marketing strategies.
Improved data quality and value
As previously mentioned, first-party data is more valuable to digital marketing strategies as it is gathered directly from their audience, meaning it is more relevant and reliable when building remarketing or lookalike lists across platforms. Using this data to inform your marketing strategy will enhance the personalisation and effectiveness of ads.
This means that – where possible – brands should be relying on first-party data collection methods to gather more accurate and relevant information on their audience.
What does Google’s pause on deprecating cookies mean for the importance of first-party data?
Google’s initial plans to deprecate second-party cookies from Google Chrome has been delayed. Whilst this gives brands more time to develop robust data capture methods and stronger marketing approaches, this doesn’t really impact the importance of first-party data.
As mentioned previously, the benefits of better-quality information provided by first-party data collection make it an essential part of any digital marketing initiative. Google itself even states that first-party data will play a role in its future ad platform solutions off the back of the removal of third-party cookies.
How brands can build out a strong first-party data strategy
By now, the importance of a thorough first-party data strategy is clear, but how can brands go about devising one? In this section, we explore just how to do this.
Building a comprehensive data capture and management strategy
Ensuring all avenues of first-party data collection are working efficiently and in compliance with GDPR privacy regulations are paramount to successfully using first-party data.
Website analytics tracking
Using Google Analytics or another type of website tracking platform, falls under first-party data and offers invaluable insight into the online behaviours of your audience.
Understanding if your website is compliant with GDPR regulations when collecting data is really important. If you’re using Google Tag Manager, implementing Google Consent Mode is key to following regulations (learn more about Google Consent mode and why it’s important).
Call tracking
Tracking where your calls are coming from, both online and offline (like via a call centre), is a key part of both first-party data collection and conversion optimisation. Don’t forget about SMS information, such as open and response rates.
Companies like Infinity provide call tracking services which provide a lot of detailed call information. Find out more about Infinity, and why you should be using it.
Advertising platform pixels
Most social media advertising platforms have a pixel or insights tag which can be added to a website to identify users cross-platform and better attribute conversions. These are key to building first-party data in social platforms and analysing campaign performance.
It’s important to note – if you’re using Google Tag Manager, each tag needs to be assigned a consent variable.
If you’re advertising using Google Ads, setting up Enhanced Conversion measurement is key to more accurate in-platform data.
Regularly checking updates and new features of these pixels and insights tags can help you improve the accuracy of the data you’re collecting in advertising platforms.
Forms
Using forms to request data from users is an effective way of collecting first-party data. Examples include:
- Newsletter subscription lists
- Requesting data to download specific reports or insights
- In-platform lead forms on social media ads
CRM and email lists
Your email marketing software can capture a lot of useful first-party data. Segmenting your email lists accurately into different buckets is key to understanding what your customers are interested in and what they want to learn more about.
If you do this correctly, you can use these different buckets to feed into your marketing platforms.
Mobile app usage
Tracking how people use your mobile app can be another valuable source of first-party data, such as in-app purchases.
Offline data
Don’t forget your offline sources of data – things like in-store purchases or surveys with salespeople can all work to inform how you engage your target audience.
How first-party data can improve digital marketing strategies
There are a variety of ways you can use first-party data to bolster your digital marketing efforts.
Understanding audiences and customer segmentation
If you effectively set up multiple avenues for collecting first-party data, you can use this to inform how to reach more potential customers. You can gain an understanding of things like:
- The method of communication they respond to the best
- Which channels they consume the most content on
- When they are the most active online
- What messaging or themes resonate with them the most
- What aspect of your offering they find the most useful
Adjusting your strategy to work with the data you collect will mean your marketing strategy will evolve alongside the evolving needs and expectations of your audience.
Remarketing lists throughout the funnel
A more technical application of first-party data is creating remarketing lists off the back of your customer segments. This can be applied at all stages of the funnel, from raising awareness (e.g. has viewed an ad but not engaged with the brand online yet), influencing consideration (e.g. has engaged with your social media or website but hasn’t visited an article or product page) and driving conversions (e.g. has added an item to basket but not completed the purchase yet).
In most platforms you can remarket users who have taken a certain action in-platform or using uploaded customer data.
Some platforms’ retargeting lists often don’t backdate when created (for example, LinkedIn), so creating them only when you need them isn’t always effective as they’ll need time to build up. It’s best to build the key remarketing lists ahead of time so you have them if you need (e.g. website visitors, purchases, social media profile visitors).
Examples of remarketing lists based on uploaded customer data:
- Newsletter subscribers
- Report downloaders
- Applicants who passed a certain level of a job process
Lookalike audiences for prospecting
Most advertising platforms offer some sort of lookalike audience feature – the platform takes a remarketing list and finds users similar users to those in that list, based on audience signals. This expands the reach of prospecting campaigns whilst maintaining high audience relevance.
Lookalikes can also play a role at different parts of the funnel, depending on the seed audience. For example, using a lookalike audience based on users who have purchased online in the past 30 days is a good way to expand your conversion layer, but a lookalike audience based on people who have viewed one of your ads is going to benefit an awareness campaign.
First-party data is valuable for any marketing initiative as it’s sourced directly from your audience and should be a key part of your digital marketing strategy. If you’re looking for some expert guidance, Passion can help you devise a data strategy to grow your business. Get in touch today!