The critical step in building a successful first-party data strategy

With Google phasing out third-party cookies by 2024, first-party data has become all the more important for brands and marketers. First-party data is information obtained directly from a company’s customers or end users. It can be gathered from a variety of sources, including web interactions, mobile applications, and loyalty programmes directly from customers.

For long, marketers have been relying on ad platforms, which have used third-party cookies to track user behaviour on the Internet for years. However, the GDPR and CCPA regulations paved the way for Google's announcement about phasing out third-party cookie tracking, Apple's iOS 14+ updates, and the Android privacy update. As a result, marketers must use first-party data to send personalised messages to customers and improve ad campaign performance.

With the aforementioned recent updates, e-commerce businesses will be unable to rely on collecting user behavioural data from ad platforms such as Facebook and Google. Because the ability to collect data is severely limited, it is time to collect your data, own it, and understand your user behaviour.

Most marketers believe that first-party data is gathered from known visitors. However, collecting anonymous data is just as important as collecting data from known visitors or customers. Even a 2% to 3% increase in sales from anonymous website visitors can boost your revenue.

According to Dr Somdutta Singh, Founder & CEO of Assiduus Global, “First-party data is the holy grail of information. Getting insights on what people buy and how gives decision-makers their ammunition. In our experience as e-commerce marketers, first-party data yields the highest ROI possible. A customer's relationship with a brand and their journey to purchase cannot be explained by data from third-party sources, even though they can improve acquisition strategies. Furthermore, third-party data doesn't offer anything special that can't be sold to a rival just as readily. Then there are the problems that come naturally with using data from external parties, such as quality, accuracy and recency.”

“Comprehending and responding to customer wants, requirements, and purpose with 1:1 contextual relevancy is essential in this age of consumer empowerment when developing tailored and highly targeted experiences that promote brand loyalty and retention,” she added.

Shrenik Gandhi, Co-founder & CEO, White Rivers Media, commented, “In the wake of stricter data privacy regulations, first-party data has become an essential data source. Brands can now obtain high-quality data from the source that is most pertinent and direct – their consumers! Brands must utilize accurate and relevant information obtained directly from their audience to strategize their ad campaigns for running tailored ads to meet their goals.”

The most significant benefit of first-party data is that it provides insights and intelligence for giving brands a reality check about their existence in the marketplace. It gives a crystal clear picture of a brand's relationship with its consumers. This data is valuable for understanding the exact needs and preferences of consumers more profoundly for accurate marketing and retargeting ad campaigns.

On how to cull out relevant data, Gandhi said, “Segregating the most valuable parts of your first-party data is the real deal. To run tailored ad campaigns, eCommerce brands need to collate relevant data, and this can be done easily through simple forms and surveys. Furthermore, brands can interact with their audience to learn about their likes and dislikes and get first-hand feedback to enhance their offerings. Additionally, brands can employ interactive features like surveys, chatbots, and quizzes to collect and sort first-party data.”

“The base for building a successful first-party data strategy lies in getting all your data in order. Many brands skip this critical step and dive right into ideating for their ad campaigns, which might lead to unfavourable outcomes. Once brands gain access to accurate demographics and behavioural data, they can create and optimise their personalised ad campaigns with a higher success rate,” he further added.

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