Personalize Your Customer Experience Using The Power Of First-, Second-, And Third-Party Data.

Shopify Partner
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In this post, we’ll help you understand:

👉 Different types of customer data, 

👉 How they lead to more sales, 

👉And how data management is impacted by recent data policy changes made by big tech companies and governments. 


First-party data  

These data points are collected based on the customer’s intentional behavior such as: 

  1. product search or view; 
  2. checkouts initiated, orders placed; 
  3. using an email address to log in to social networks;
  4. subscribing to loyalty programs. 

This type of data stays on the owner’s website and the user’s activity is not tracked after they leave the website.


Second-party data

This type of data is acquired directly from the party, who collected it as first-party data. Example: “trusted partners” such as hotels and airlines can be sharing data between each other. Quality and potential-wise, second-party data is as good as first-party. It simply comes from a different source. 


Third-party data

Third-party data became popular through the use of cookies, which allowed for tracking the user’s browsing behavior across different sites. Third-party data is organized based on a person’s behavior, interests, and demographics. It’s often used to build prospecting and retargeting campaigns on Facebook. The biggest issue with cookies is that they’ll soon be a thing of the past so companies need to find another way to track and personalize experiences.


What’s Zero-Party Data? The New Player In The Game

This is considered to be the ‘new’ type of data, and is data that a customer deliberately shares with a company. Practically speaking, it’s a component of first-party data so it may be a bit confusing. All the rules around managing first-party data apply here all the same. You can gather it for instance by having an opt-in newsletter, a lead magnet or some sort of a tripwire product. This allows you to collect communication preference data, interests (when customers tell you what things they’re interested in), purchase data or direct feedback. In summary, zero-party data enables you to create personalized, relevant customer experience which translates into more paying customers who purchase more frequently. 


Building Your Data Strategy In The Cookie-Free World 

Companies need to find a different way to track and personalize experiences. If you have a data strategy for your first-party data, half of your entire data strategy is covered. Now, the key is to develop new strategies to get as much first-party (and zero-party) data as possible. So whenever you ask people to leave their email, consider asking them to also share their preferences and interests.

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