In this article, we will focus on the following:
- The different types of customer data
- Where brands can find untapped 1P data and easily access it
- How brands can get more and better loyalty data from their customers
- Where 1P data can be found outside of your website, how to access it, and how to leverage it
First party (1P) data is the most talked about data these days within digital marketing and ecommerce. The primary reason for this is privacy regulation and the loss of quality third party cookie data due to blocking by the browser companies. Before we jump into what brands can do to solve for this challenge, let’s first make sure everyone is clear on the different types of data/sources.
- First Party: The holy grail of data is data that brands have collected directly from their users and customers. Typically this is data collected from a brands website but it can come from many sources, more to come on this later.
- Second Party: This is data that a brand buys or trades with a partner. This is a direct data exchange which allows brands to know exactly where the data came from and the pretext that it was gathered. Brands should be disclosing this data transfer somewhere on their website so their customers are aware. Brands also typically gain permission from their customers before sharing with other brands.
- Third Party: This is data that brands buy indirectly from a 3rd party that collected the data from another source or sources. The most common example in our industry would be adTech companies that collect data via client websites and then leverage that data for the brand or other brands. The fact that a 3rd party collected it makes it 3rd party data, even though it may be used for the brand who’s website the data was collected. This is the type of data that is under scrutiny these days because consumers haven’t given direct consent on how their data can be used by others.
Given the challenges with 3P data over the last couple of years, brands are starting to make concerted efforts to collect and own their own 1P data. But, most brands aren’t going far enough, but why? The only reason I can come up with is because it’s hard and that’s fair. Most people think of 1P data as things like name, address, phone number, email, and order history. Many brands will take this data and port it into a CDP and augment it with 3P data (and maybe 2P) to make user profiles more robust. This can lead to better ad targeting, website experiences, and customer communication. These are all very good reasons and brands should keep doing it.
The thing is, brands have so much more 1P data and it may be more valuable to their overall business than what they already surface. The most important data is what your customers are saying directly to you. Customers communicate with brands in many channels:
- and other social media platforms
The challenge with communication data like this is that it’s vast and really hard to gather, organize, and share company wide. Typically, all of this data flows into some sort of data lake that builds upon itself until its a mountain of unusable data. If a brand is lucky enough to have large BI teams that includes several data analysts, they might be able to make sense of all the data but it will take a lot of time. That is until now. Companies like Dashbot and their Conversational Data Cloud have developed ways to leverage AI and Machine Learning to sift through terabytes of data and organize it in useful ways based on a brands business. Now conversational data can be visualized and leveraged by Marketing, eCommerce, Product, Customer Service, and any other department that can benefit from hearing directly what customers are saying and want. Did you know that the average brand is sitting on over 300TB of conversational data?
Another way for brands to collect more usable 1P data is through loyalty, especially loyalty credit cards. Loyalty programs on their own can reward customers in exchange for information but it doesn’t stop there. Platforms like Zinrelo allow customers to earn credit for offline purchases as well as offer them various ways to earn points beyond purchases. Brands with loyalty credit cards can gain deeper insights into their customers purchasing, travel, and consumption behaviors. This type of loyalty has traditionally been reserved for the biggest brands but that is changing thanks to Sunbit. They aim to service the brands/retailers that banks like Syncrony won’t. What’s really nice for your customers is that the approve over 80% of applicants. How are you keeping your customers loyal?
Lastly, brands that know what their customers read, write, post, buy, visit, and share will have an advantage over their competitors that don’t. ProfitWheel is unpacking customer data to help brands better understand their customers. If 1,000 people buy the same product, does that make them identical? Of course not, some might be into fishing or food, or travel. If you know this, you can begin to segment your target audiences, message to them in a more personal way, and drive more new customers efficiently. Is your media buying and creative development subjective or based on 1P data?
eCommerce has made it more difficult for brands to stand out because creating unique experiences online is hard. It’s too easy for consumers to jump from one website to the next because they don’t feel special. However, if you have the right data, brands can make their customers feel special through products, communication, and service.