With the continuously evolving landscape of digital marketing, businesses need to keep ahead to succeed. In this column, we'll answer your questions about key trends and advancements shaping the future and advancing technology in the digital marketing space.
Q: We're a company focused on the Christian demo and we've used cookies to collect our customer data, but we understand cookies are going away. Why? How will we be able to collect reliable consumer data? R.J. from Philadelphia, PA
A. R.J., let me provide some insight. The increasing consumer concerns over how their personal data is being used and how their privacy and security are being protected are leading toward a shift to what many digital marketers term a "cookie-less future." This shift was first driven by major companies like Google announcing they would phase out third-party cookies in Chrome throughout this year. Many other web browsers, such as Safari, Firefox, etc., will also be following suit soon and will no longer support collecting and tracking consumer behavior.
Going forward, for businesses to create marketing strategies and continue to achieve success with targeted advertising, they will need to find other ways to collect and analyze their consumers' data. While numerous strategies are emerging, first-party data is considered one of the top alternatives for many businesses.
First-party data is the information that a company collects directly from its customers, brand channels, apps, or websites. It provides valuable insights and advantages for businesses, including:
- Accuracy and reliability: Since first-party data comes directly from consumers, businesses can have confidence in the quality of the data. This accuracy allows for more precise targeting and personalized marketing efforts.
- Privacy compliance: Since businesses have a direct relationship with their potential customers, they can ensure compliance with privacy regulations and obtain proper consent for data collection.
- Robust insights: By analyzing the data insights they collect, businesses can gain a deeper understanding of their customers, their needs, and their purchasing patterns. These insights can drive more effective marketing strategies.
- Customization and personalization: By understanding their customers' preferences and past interactions, businesses can create personalized experiences that resonate with their audience, which can result in higher engagement, conversion rates, and customer loyalty.
There are numerous ways to start collecting first-party data. Here are several of the top ways businesses are employing to collect reliable customer data:
- New customer registration: When customers sign up for a product or service, they provide personal information such as their name, email address, age, location, and other relevant details.
- Online forms: Businesses often use online forms to gather information from customers. These forms can be used to collect data such as preferences, interests, feedback, etc.
- Website tracking: By implementing analytics tools like Google Analytics, organizations can track user behavior on their websites. This includes data such as page views, time spent on each page ,click-through rates, and other interactions. This data provides insights into user engagement and helps in understanding audience preferences.
- Transactional data: When customers make purchases or other transactions with your business, data related to those transactions is collected. This includes information such as purchase history ,order details, payment information, and shipping addresses.
- Social media interactions: Businesses can collect data from social media platforms where customers interact with their products or brands. This includes data from comments, likes, shares, and direct messages.
Q: How does first-party data differ from other data collection, and is it really the best? A.C. from Cincinnati, OH
A. Great question! You're right; there are several types of data that businesses can collect. I believe first-party data is the most reliable, along with other advantages I discussed in the answer above. Here are more details about the three main types of data collection, including their sources and characteristics to help you decide which is best for your company:
First-party data is collected directly from customers through their interactions with a business's website, app, or social media channels. It's considered very valuable and reliable with fewer privacy concerns. It provides great insights into the behavior, preferences, and characteristics of your audience. Examples of first-party data include website analytics, customer surveys, purchase history, etc. By analyzing first-party data, businesses can gain a deeper understanding of their customers and tailor their marketing strategies accordingly.
Second-party data, on the other hand, is data that is collected by one company and then shared or sold to another non-competitive company. This type of data sharing allows businesses to access a broad range of information about their target audience. For example, a company may purchase an email list from a partner company to expand its customer base. Second-party data can be valuable for businesses looking to reach new customers or enhance their existing customer profiles.
Third-party data is information collected from various external sources by a company that has no direct relationship with the customer whose data is collected. This data is often compiled from multiple sources and can provide even broader insights into consumer behavior and trends. Third-party data can include demographic information, browsing history, social media data, and more. It is commonly used for targeted advertising, market research, and audience segmentation.
While all three types of data collection can provide valuable insights and enhance a company's marketing efforts, first-party data is considered the best type of data because it is collected directly by your company from your customers. It is more reliable and has fewer privacy concerns. With second-party data, the data is shared and has some privacy concerns. Third-party data has an increased risk of privacy concerns and may require compliance with data protection regulations.
IMPORTANT: Companies must comply with privacy regulations and obtain consent from customers before collecting and using their data. By implementing transparent data collection practices and providing clear privacy policies, your business can build trust with your customers while ensuring the responsible use of first-party data.
Have a question about first-party data, digital marketing, content marketing, etc.? Just fill out the form here, and I'll get back to you and possibly feature it in a future Beacon!
