Customer Data

In 2021, customers are seeing between 6,000 to 10,000 advertisements every day. Knowing how bombarded people are with this type of daily messaging fuels the never-ending mission of companies to find new ways to reach their customers that feel personalized to their needs. No longer can marketers put a single advertisement in magazines or on television and expect to target their ideal audience.

Instead, they need to adopt new strategies and technology to find the right brand messaging to attract more customers. One of the most significant changes marketers need to make is the shift from primarily using Third and Second-party data to incorporate self-declared data with Zero-party data.

What Is the Difference Between These Data Sets?

Before incorporating any of this data into your marketing, it’s essential to understand the differences between each type of information. Previously, companies had to rely on three categories of data for their marketing strategies, including:

• Third-Party Data: This is information that is collected from an external source. Third-party data is pre-collected and available to anyone who wants to purchase it.
• Second-Party Data: Second-Party data is first-party information that is exchanged from another company to benefit both parties. This data exchange usually works for products that complement each other, such as makeup and makeup cleaner.
• First-Party Data: First-party data is the information collected directly from your company.

However, these forms of data do not always provide the entire truth on customer’s preferences. The fourth type of data that brands have incorporated that have worked most effectively is self-declared which includes Zero-party data.

What Is Self-Declared Data?

Simply put, when a customer proactively or intentionally shares information with a brand, this is considered self-declared data. This data set may include preferences, personal context, how the individual wants to be recognized, or even the purchase intent. Plus, it helps to ensure privacy for your customers by gaining permission before collecting their information. Brands that utilize this opportunity will stay ahead of their competitors by gaining valuable insights into your customer’s preferences and tastes.

Targeting with Self-Declared Data

Having this highly individualized data helps companies meet customers’ preferences and demands. Self-declared data can build lasting customer relationships, enhance customer experience, forecast future trends, and even create strong customer personas.

When you can accurately build your customer profile and identify what your customer cares about, you can deliver timely advertisements that will have a higher ROI. For example, through self-declared data for your clothing store, you can learn the type of customers visiting your store. Maybe one of these groups are middle-aged females who love your yoga pants collection. Knowing this critical information ensures you’re not sending them a coupon for something they don’t care about, like men’s jeans.

As consumers start to have higher expectations regarding data privacy and brand experiences, marketers will have to reassess how they’re reaching their target audience. Thankfully, self-declared data provides an excellent solution to this ever-growing problem and allows your company to offer a personalized, relevant experience through customer data.

The vast majority of current web browsers now block third-party cookies or are on their way towards full blocks. This means that online advertisers and analytics firms cannot use browser cookie files anymore to track users as they visit different sites across the internet. The transition away from third-party cookies is causing brands to look at new ways to track visitor online behavior while also maintaining privacy.

First-Party remains

It should be noted that the move away from third-party cookies by the three major web browsers does not mean an end to cookies.

Thanks to Third-Party Cookies entities were able to collect information about consumers without having a direct relationship with them. Sources of third-party data include consumer data brokers, credit reporting agencies, ratings companies, and publicly available records. Most commonly, data vendors aggregate unrelated sources to compile third-party data sets.

First-party cookies, that are placed on a person’s browser when they visit a website owned by a primary company or organization, will still be in place.

Companies will be able to track visitor behavior in terms of where they entered the site, how long they stayed, pages visited, and where they exited. This remains a core and central part of any organization’s data gathering practice and helps them determine how their sites and product offerings should be configured.

Data Privacy Matters

Another major concern for marketers thinking about their data is privacy. Because third-party data comes from an entity without a direct relationship with consumers, it’s the single biggest offender, and it’s coming up more and more in light of the GDPR.

Companies have to obtain consent from consumers to contact them for marketing purposes, share or sell data to third parties, and for any uses that the consumer “would not reasonably expect.” Consent is a must for profiling and segmentation that uses personally identifiable information (PII), automated decision-making, and direct marketing.

In summary

The blocking of third-party cookies is coming, but it’s not completely here yet. The slow crawl to a complete phase-out may seem like a temporary reprieve. In the meantime, companies should devote themselves to building a more mature, robust, and accurate attribution methodology that takes into account the multiple ways customers engage with brands.

To power personalization brands need self-reported data, actively given by consumers. Third-party data won’t give you that as it is taken from publicly available sources and mostly inferred. The opportunity for brands is to engage and get to know their customers better and to build a declared data strategy.