First-party data is more important to marketers than ever, according to a newly published survey by Acquia and Vanson Bourne.
The two companies surveyed U.S. and U.K. marketing executives about their growth strategies going into 2023. The study found that:
- Marketers are creating first-party data strategies to generate insights for personalized content as web browsers prepare to phase out third-party cookies.
- 88 percent of those surveyed say gathering first-party data is more important to organizations than two years ago.
- But only 35 percent “strongly agree” that their organization is “fully prepared for the cookie-less future.”
The above suggests that marketers understand that first-party data is important. But they need help tapping into the value of first-party data.
First-party data is information that your business collects from customers. Examples:
- Data tracked from visits to your website.
- Customer feedback
- CRM data
- Social media accounts
- Subscription-based emails or products
By contrast, third-party data is data that your business collects from potential customers based on their browsing habits across the web. Third-party data, which is typically bought from another company, is based on third-party cookies that track consumer behavior. But privacy controls from Apple and Google are making it increasingly difficult for businesses to use third-party cookies. Apple eliminated third-party cookie tracking on its Safari browser, and Google will do the same on its Chrome browser (the most popular browser in the world) in 2024. In addition, a privacy control enacted by Apple in 2021 makes it easier for people to opt out of cookie tracking on Apple devices.
In a more privacy centric world, advertising that uses third-party data is going to be less targeted. It won’t become useless, just less effective. How can first-party data help a business, though? Here are a few ways:
- Retarget customers. In addition to retargeting customers with ads, a marketer can use first-party data collection to send out personalized emails, for example like cart abandonment reminders.
- Target new customers based on data you collect about your current customers. Based on data collected from your site visitors, social media following, and email subscribers, you can pinpoint other demographics and geographical locations likely to be interested in purchasing your products. You can use this \ information to build out campaigns that target fresh audiences.
- Understand you customer’s journey. First-party data can give you insight into all the ways a customer interacts with your brand, assuming you combine web analytics with other forms of first-party data such as customer surveys and email outreach.
- Improve the buying experience. You can identify how smoothly or problematic the conversion and purchase process is after your advertising takes a customer to your site or app. Are they clicking through? Are they completing a transaction after that? Why, or why not? For instance, are customers abandoning your site at the shopping cart?
- Develop new products and categories. Using first-party data from surveys and questionnaires, you can identify gaps in your offering and create new products and categories to match customer demand.
First-party data does not get collected and used in isolation. Businesses can make their online advertising more effective by building campaigns based on their own first-party data and:
- Someone else’s first-party data. For instance, Amazon, Walmart, and other retailers have been building online advertising businesses based on their own first-party data. Meta’s broad targeting ad program consists of an automated targeting approach that reportedly produces better results for Facebook and Instagram ads than more refined, more niche audience approaches do.
- Workarounds to third-party data such as Google’s own Sandbox, which is Google’s own effort to develop alternatives to third-party cookies. However, the Sandbox is very much a work in progress. Learn more about third-party workarounds here.
Businesses can also continue to rely on third-party data and accept less effective results. But the clock is ticking. When Google phases out third-party cookies in 2024, everyone will be entering a new world.
At True Interactive, we can help businesses improve their advertising as they transition to the use of first-party data. For instance, we know how to work with all the major platforms that rely on their own first-party data, such as Amazon and Walmart. And we can work with businesses to create more targeted campaigns based on first-party data collected from analytics tools such as Google Analytics. Contact us to learn how we can help you.