In today’s digital age, data is generated at a rapid speed. According to Exploding Topics research, approximately 28.77 million terabytes of data are created each day, and over 120 zettabytes of data will be generated this year.
But some data is better correlated to your customers and business than others. We’re talking about first-party data.
First-party data is the information collected directly from your customers and audiences on your own business channels. With this kind of direct interaction, you can power your marketing strategies and improve overall business processes with feedback and information generated straight from the horse’s mouth.
In today’s post, you will walk away with an understanding of first-party data, how it’s collected, and how to use it to fuel your marketing success.
What is First-Party Data and Why Does It Matter?
First-party data is your company’s best asset to build customer trust. Let’s dig into what first-party data is and how it’s beneficial to your marketing efforts.
The Critical Role of First-Party Data in Your Strategy
First-party data is the information you collect directly from your audience through your interactions with them. This includes data from:
- Website visits
- Transactions
- Social media engagements
- Customer feedback
- And any direct communication stored in a customer relationship management (CRM) platform.
Collecting first-party data is crucial for understanding customer interactions with your brand, optimizing marketing strategies, segmenting audiences, and enhancing ad campaign performance.
When customers and users willingly share their data, it means there’s a level of trust with your business. A great way to reciprocate that trust is to abide by privacy regulations and obtain user content. Let your audience know you will handle their data respectfully by adhering to the General Data Protection Regulation (GDPR) or the California Consumer Privacy Act (CCPA).
The Benefits of Using First-party Data
First-party data is inherently valuable because it comes straight from your customers. You can’t get much more reliable than that.
This level of proximity allows you to tailor marketing messages and strategies more precisely, without the dilution of additional third-party data that’s not as reliable. Instead of guessing what your audience might respond to, match their interests with data based on their own behavior.
The relevance of first-party data also gives greater visibility into customer experiences. Study their behaviors to see things like where users are dropping off on your website or where they’re clicking your demo button most, and segment those audiences for retargeting or lead nurturing. Make more informed decisions on business processes and the structure of your website, too.
This type of accuracy and personalization creates a continuous connection between your audience and your brand, increasing the chances of engagement and ultimately, conversions.
How First-Party Data is Collected
First-party data is collected in multiple ways, including:
- Website tracking pixels
- Within your CRM system
- From customer surveys,
- Or through social media.
Marketers commonly use tracking pixels because you can easily add a user-friendly line of code to your website, product, or social media to collect data on user behavior. This data is then pushed into your CRM or customer data platform (CDP).
We’ll dig into first-party data collection more later in this post.
The Different Types of Data in Marketing: First-Party, Second-Party, Third-Party, and Zero-Party Data
First-party data can be complemented by second-party and third-party data. Let’s look at the difference between the three.
First-Party Data
First-party data is directly sourced from your customers or users and can include:
- Name
- Customer email
- Phone number
- Deals and purchase history
- Physical address
Marketers love first-party data because it gives them front row seats to their customer’s behavior, opening the door to creating ultra-personalized marketing campaigns.
Let’s take an eCommerce brand for example. When someone visits your product collection page and then checkout page, but doesn’t complete the transaction, a tracking pixel will collect their data that you can use to retarget cart abandoners.
This level of insight is a goldmine to iterate the content you serve along the customer journey.
Second-Party Data
Second-party data is essentially another company’s first-party data that you acquire through partnerships or agreements and can include:
- Demographic data
- Customer contact details
- Advertising IDs
- Social media activity
An example of this partnership is when software companies share their first-party data with agencies, who then resell it as second-party data to target new clients.
Second-party data can be particularly valuable for companies looking to enter new markets or expand their customer base. With insights from a similar audience, marketers can leverage the established trust and audience insights of their partners.
Another example is when an identity resolution tag, like the Untitled ID Tag, fires on your website to identify anonymous website visitors. You can use this data to market directly to already engaged buyers or retarget visitors.
When leveraging qualified second-party data from an audience intending to buy or consider your solution/product, it can complement your overall data strategy.
Third-Party Data
Third-party data collects information from various external sources not directly related to your company and can include:
- Basic contact information
- Cookie data
- Intent data
- Survey responses
Third-party data is collected, aggregated or sold from surveys, public records, and online customer behavior tracking across multiple websites and platforms.
While third-party data provides a wide lens through which to view potential market segments and consumer trends, it may lack the specificity, relevance, and accuracy of first-party data. However, when used wisely, it can complement your own data by filling in gaps and offering a broader perspective on the market.
Using third-party data must be taken with caution, though. Whenever you acquire, store, and use this type of data, you must adhere to data protection regulations like GDPR. Mandating consent for users is important because some people may not understand how and when third parties collect their data.
Privacy concerns also affect third-party data in programmatic advertising. Because GDPR mandates user consent for data collection, third-party cookies are impacted (which have been the longstanding bread and butter for digital marketers to target users). Popular web browsers Apple Safari and Mozilla Firefox now block third-party cookies by default to offer users more browsing privacy.
To get the most out of third-party data, integrate it with first-party data to fill in the gaps and gain a broader perspective on your target market.
Zero-Party Data
Zero-party data is a relatively new concept that emphasizes data collected directly from the customer with their explicit consent, including:
- Product and purchase preferences
- Account details
- Communication preferences
- And personal context shared proactively by customers
The consensual nature of zero-party data sharing not only ensures high accuracy and relevance, but also builds trust and loyalty by respecting customer privacy and giving them control over their information.
When combined with first-party data, zero-party data can supercharge your personalization efforts, making your marketing communications highly relevant and engaging.
Building a First-Party Data Strategy for Marketing Success
Now that we’re familiar with the concepts of first-party, second-party data, and third-party data, let’s discuss how it sets your team up for marketing success.
Steps to Collect First-Party Data Effectively
Here are a few tactics marketers can use to collect first-party data (that you’re probably doing already!):
- Create or register new accounts. Encourage users and customers to create accounts and collect information like name and email address to use in retargeting campaigns.
- Leverage email marketing with newsletter sign-up forms. Newsletter subscribers are likely users already interested in your product or service, so use their email addresses to send exclusive communication and build engaged users.
- Sync an analytics platform like Google Analytics 4. Tracking website behavior on an analytics platform is still a valuable way to gather first-party data, especially when you implement custom event tracking on important call-to-actions and monitor the Engagement Overview report and Traffic Acquisition report to understand insights.
- Track user behavior with heat mapping tools. Heat mapping and session recording tools are a behind-the-scenes way to study how users navigate your website and interact with elements. Use this information to shape your internal processes and customer journey.
- Survey your audience. Get information directly from your audience by asking them questions about preferences, satisfaction levels, and any other behavioral information that can shape your marketing campaigns and improve their user experience.
Some common tools to collect and store first-party data include CRM systems like Hubspot, CDPs, survey platforms like SurveyMonkey, analytics platforms, tag managers like Google Tag Manager, and customer feedback platforms.
Integrating First-Party Data with Your Marketing Efforts
Incorporating first-party data as the cornerstone of your marketing strategy not only ensures accuracy and relevance, but also aligns with consumer expectations for personalized, respectful engagement.
Marketers can leverage first-party data to create personalization for segmented audiences. Define criteria for segmentation, such as location, age, or purchase behavior, and study that data to identify patterns you can turn into specific customer segments. Give each segment a detailed buyer persona to shape the messaging.
This kind of personalization can improve email retargeting efforts for behaviors like purchase history or browsing behavior, and allow you to create promotions aligned to a specific segment’s behavior.
Here’s an example eCommerce brand example
Toadfish Outfitters, an eCommerce brand, needed a unified solution to collect, identify, and retarget customers who landed on their page but did not check out.
They chose to use the Untitled ID Tag, to collect emails from unknown website visitors and give them the missing first-party data they needed to market to lost customers and upsell historical customers.
They then pushed this data into their Klaviyo integration to retarget customers for new product lines and collections, resulting in the following improvements:
- Klaviyo ROAS using Untitled ID Tag: 6.8X
- Attributions and unique visitor information on hidden shoppers and net new shoppers
- Lookalikes expanded due to 60% of visitors being identified
- Total Spend: $2,500 / month
”With the Untitled, we identified over 2,000 hidden shoppers on our website in the first two days. We turned these into paying customers through Klaviyo. The ROI was insane.
Thor RhodinCMO at Toadfish Outfitters
Leveraging First-Party Data for Audience Insights and Customer Journey Mapping
First-party data is a treasure trove of information about your customers and their behavior. Metrics like total website or landing page traffic, content engagement like time on page and bounce rate, purchase behavior, and even support inquiries can collect patterns and trends that shed light on your audience.
For example, analyzing customer browsing history on key website pages can help you understand their wins, points of friction, and buying triggers. Use this information to create personalized and targeted campaigns that encourage customer retention and brand affinity.
What’s more, when you zoom out your first-party data lens, you can see a comprehensive view of the customer journey. By connecting data across touchpoints, from awareness to post-purchase, you find opportunities to optimize the user experience at every turn.
That means you can craft and deliver personalized messages that reach your users and customers at the perfect time, creating a seamless user experience for your audience.
Embracing a First-Party Data Strategy
Building a robust data strategy starts with a solid foundation of first-party data. It’s the key to unlocking richer customer engagements, enhancing brand loyalty, and discovering new avenues for revenue. Begin with clear objectives, be it improving customer experiences, retention, or acquisition.
Ready to enrich your first-party data with one the largest data co-ops in the U.S.? Try a free trial of Untitled to increase your personalized touchpoints and drive conversions.
