Zero-Party Data Fundamentals: The Basics You Need to Know About Consumer Data

Relationship Marketing is the practice of growing long-term relationships directly with consumers while understanding their true wants and needs to deliver better-personalized products and services. To create these relationships with customers, brands need to be powering personalization with the right class of data — that is, zero-party data.

What is zero-party data?

Zero-party data allows brands to build direct relationships with consumers, and in turn, better personalize their marketing efforts, services, offers and product recommendations. By connecting directly with consumers, rather than making inferences and assumptions, marketers collect zero-party data by simply asking. If customers trust and value their interactions with a brand, they will proactively and intentionally share their data. Brands can then use the data, insights and permissions customers provide to create more personalized marketing.

The different types of data

First-party data: Brands collect first-party data directly from the customer, usually during sales or form completions; this type of data can include past purchases, mailing addresses, product preferences and dates of birth. Since it comes directly from the source, it provides valuable insights into how a customer interacts with your brand and how their behaviors change over time.

Second-party data: Second-party data is another organization's first-party data. Second-party data is shared and not sold between two trusted companies, and then blended with first-party data to target known and unknown audiences. 

Third-party data: Vendors typically collect third-party data, which is then purchased by brands. This type of data can include any number of personal or anonymized data points, such as information on demographics and online activity that can provide inferences about a consumer’s interests and preferences. Third-party data holds some degree of value for marketers, but it carries significant risk.

How brands can collect zero-party data

Gathering zero-party data requires a thoughtful and strategic approach. Brands should strive to create personalized experiences that are easy, transparent, and valuable to the consumer, ensuring they understand how their data will be used and how sharing it benefits them. 

Collecting zero-party data requires brands to create a worthwhile value exchange. Either from the marketer’s or the customer’s perspective, this value exchange is simple: ask, receive, give, repeat. Questionnaires, polls, quizzes, sweepstakes, QR codes at point-of-sale, and social stories, to name a few, can incorporate reward mechanics that give consumers a genuine reason to engage and submit their first- and zero-party data.

The benefits of personalization

Consumers love personalization powered by zero-party data. The key to winning is establishing an intelligent messaging strategy that goes beyond “casting and blasting,” or personalization that peaks at a first name in the subject line. Messaging should offer products your customer has expressed an interest in, that fits their declared budget and contains dynamic content that uses keywords you know will elicit engagement from them.

Build relationships with customers

Zero-party data is the future of Relationship Marketing and has an impact across the entire customer lifecycle, from acquisition and retention to loyalty. Start building relationships with customers now by creating a worthwhile value exchange and helping your customers along their journey. 

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