At Infocore, data is at the core of everything we do. That’s because we know that data-driven marketing produces tangible, measurable results. But, which data should you use? What data can you trust? We know – it can be intimidating. To get you started, here’s a handy primer to help you understand the different types of audience data.
If you pay attention to data-driven marketing trends like we do, you may have heard a lot of buzz about something called zero-party data. Zero-party data actually refers to first-party data that a customer proactively shares with a company in order to receive something of value in return. The customer may volunteer their personal information in exchange for a coupon code, a free download or a more personalized customer experience.
Like all first-party data, zero-party data is collected through firsthand responses to surveys, polls, questionnaires, etc. However, since zero-party data is self-reported, it can sometimes be skewed if a customer gives false information or simply tells a company what they think it wants to hear. And because a consumer’s preferences may change over time, this type of data is fluid in nature.
First-party data refers to all data that is collected directly from the consumer, generally as the result of a transaction or interaction of some sort. First-party data can come from POS (point of sale) systems, direct marketing analytics, website visits, mobile apps or social media followers as well as the self-reported methods listed above.
First-party data is key to any company’s successful CRM (customer relationship management) and can be leveraged to retarget customers based on their purchasing preferences and patterns. While first-party data is great for marketing to your existing customers, it’s not very helpful if you want to acquire new customers. That’s where second- and third-party data come into play.
Simply put, second-party data comes secondhand. It’s typically another company’s first-party data that is purchased or exchanged as part of strategic partnerships and mutually beneficial relationships. While second-party data can enhance your own first-party data and help forge alliances with other businesses, it can have some limitations.
Second-party data is only as good as another company’s first-party data. If your partner has not been sourcing high-quality data or data that’s compliant with current privacy regulations, then they pass that liability on to you. And while second-party data can expand your reach, your potential audience is somewhat limited depending on the reach of your partners.
As its name implies, third-party data is generally collected from various third-party sources, such as data compilers and aggregators, and is typically preferred because of its impressive breadth and depth. Third-party data can be used to append first-party data with demographic, geographic, psychographic and contextual information, allowing for a more complete understanding of the lifestyle, preferences and needs of your customers.
In addition to enhancing first-party data, leveraging third-party data allows you to exponentially expand your reach. As many marketers already know, third-party data is an indispensable tool in the quest to acquire new customers. The sheer volume of data available makes it possible to create highly targeted campaigns that find the right audience at the right time, increasing the likelihood of conversion.
Considering the vast array of third-party data options available today, marketers need a trusted partner to navigate the selection process. To learn more about Infocore’s stringent vetting process that ensures that our providers are delivering high-quality, high-performing data, read our blog post on Leveraging Third-Party Data. At Infocore, we are not only experts in third-party data, but we are also global thought-leaders when it comes to issues of data privacy compliance and quality control. Contact us to request a consultation.