Since the world of commerce first opened its doors, discovering who is the right kind of customer has been the goal of every type of business. Millions of dollars have been invested globally in third-party consumer data claimed to be interested in your product or service.
Finding new customers is always at the top of the sales and marketing strategies list, but what about your existing customers?As one of Brisbane’s leading marketing agencies, join us in discovering exactly what third party data is and how you use it. First-party data is crucial to understanding your customer's needs, pain points, and successes and is collected directly from your own customers. It includes data from website activity, purchases, support queries, interests and behaviour, email responses, etc.
What is Data, and Why is it Important?
Customer data is essential to help you and your business build the utmost experience for anyone using your services or products. Understanding customers is crucial. Making effective use of data-driven marketing can ensure you stay ahead of the pack and remain competitive in your niche.
Some data produces better results than others
However, some data can produce better results than others. Each type helps build particular marketing strategies. First-party data is a way of finding out your customer's preferences directly from them.Any other data generally comes from companies who specialise in providing data and comes with a price tag. This is usually referred to as second and third party data.So, what are second and third party data? Read on to find out more.
Second-Party Data
According to tech giants Adobe, it’s staggering to discover that 87% of marketers say that data is their most untapped resource. With second party data being effectively ‘second in command’ to its first-party leader, it’s a fairly shocking statistic. The easiest way to understand second-party data is essentially someone else’s first-party data. It will generally be purchased directly from the owner rather than via an agency. Second-party data comes from various sources such as:
- Website activity
- App usage
- Customer surveys
- Social media
One of the downsides of using this kind of data is that it can be a minefield in finding the right data sets.
Third-Party Data
For data marketers, the main difference between second and third party data is that third party data is not the original collector of the customer stats. Those selling it will have essentially trawled through internet websites and platforms where it was initially created.This information will then be purchased by the third-party data suppliers, who will sell it to other businesses. Like second-party data, the third party has additional issues as it's essentially third hand. It can be challenging to identify the source of such data and how relevant it is to your customers, and also it may be old or outdated.
First-Party Data
So, it’s relatively clear that the most useful and cheapest type of data is the first party type. So let’s get more into the question what is first-party data, and how do you use it? First-party data entails gathering data from your customers to build marketing strategies designed to improve customer retention and increase sales, among others.
What are some examples of first-party data?
In general, most of this data will be captured by customers' purchases, support, and customer successes. Data marketers will pull their information from
- Purchase history
- Website activity
- Customer feedback forms
- Support calls
- Interests and behaviours of customers
- Demographics
- Beacons
- Social media
- SMS
- CRM
- Point of purchase
Most clued up data marketers know the value of customer retention rather than mining for new.In a recent LinkedIn survey, it was found that a whopping 50% of business revenue was generated from existing customers who were likely to spend 67% more than new ones. So, how can you maximise the capture of this important data? Using this critical data allows you to drive more sales and crucially understand what your customers are getting or want from your offering.
How do you use first-party data?
According to market research giants Statista, using data including first-party is an important consideration. Their September 2021 survey uncovered that 60% of respondents said customer data was a key point in overall business decision making. So by the first-party data principle, you will reach a more broad understanding of your target market and join the ranks of other savvy entrepreneurs. Find out how else first-party data benefits your marketing strategies and how to use it.
Increase relevance
As we said earlier, the relevancy of second and third parties could be questionable and also might not relate or identify specifically to your customers. First-party data will give you the most independent intelligence and relates directly to your customer's journey. It will accurately log essential touchpoints in the buying cycle and can help to pinpoint how your customers respond more precisely. With this important information, data marketers can build more robust marketing campaigns based on preferences, location, purchase history, interests and more.
Omnichannel
Having an overview of every step your customers take, it's possible to create better marketing strategies that can target specific audiences and segment and guide customer behaviours. First-party data can pull through information across a broad spectrum of your offered platforms, including socials. Marketers can use first-party data to exactly pinpoint a customer's journey. So, for example, see how they responded to an email campaign, moving through to your website before completing a purchase inspired via an app. It gives data marketers important information to segment and optimises campaigns for a range of customers across all platforms, leading to higher conversion.
Customer’s journey
Data marketers can use first-party data to help them design and implement the right kind of message that resonates with their target market. It can help build the crucial strategies that will make customers return time after time, leading to higher conversion rates. First-party data can help map out the customer's journey from the moment they hit your site through all the various touchpoints, including purchases and the important information that can be collated from shopping carts and beyond.
To Sum It Up
Here at Anchor Digital, we understand that not only your brand is king, but also your customer. Data-driven marketing is a subject our team of professionals understand. We offer many solutions to keep your existing and potential customers coming back for more.
As one of Brisbane and South-East Queensland’s leading marketing and digital agencies, our expert team can work with you to build your empire. Talk to us about how our 360-degree marketing and advertising can increase sales and conversions.
