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First-Party Data and the Cookieless Future

The cookieless future is almost here, but it doesn’t have to be grim. In this article, we cover the role of first-party data, outline how you can collect it, and share tips on getting the most out of it.

Article updated on: 12 September 2023

If you work in digital marketing (or follow what’s new in the digital space), chances are that June 2021 will ring a bell for you. That’s when Google announced it would eliminate third-party cookies starting in the second half of 2024. Even though Google announced a new tracking technology that would replace them, marketers everywhere wonder whether personalized ads will still be possible after the switch.

Even if personalized ads are here to stay in some shape or form, it’s questionable whether they will be able to reach their target audience with the same efficiency. According to McKinseythe $152 billion US digital advertising industry will lose access to most third-party data. This gap will make segmenting more challenging, resulting in first-party data becoming the primary driver of digital marketing initiatives.

But the cookieless future doesn’t have to be grim. Although marketers will have to develop new data strategies, a thorough understanding of first-party data can help overcome this challenge.

Read more: How to Build a Data-Driven Company: The Ultimate Guide

In this article we’ll cover the following:

What is First-Party Data?

First-party data represents the information a company collects directly from its audience – website visitors, customers, and social media followers.

With the world shifting towards a cookieless future, compiling first-party data became the top priority for 88 percent of advertisers. They also aim to increase the collection of zero-party data – the information consumers proactively and intentionally share with companies.

But what makes first-party data different from second-party and third-party data? Second-party data is the data marketers purchase from a trustworthy partner who, on the other hand, got it directly from their customers. So, for example, it’s the data that media publishers sell to advertisers about their readers.

Third-party data represents information that various entities – including NGOs, government, and academic organizations – collect from users with whom they have no direct relationship. Marketers can buy and use these to attract their target audience more efficiently.

Even though Google’s announcement of phasing out third-party data caused quite a commotion, first-party data are more valuable than most marketing professionals think.

Why is First-Party Data Important?

According to Google, leading marketers are 58 percent more likely than mainstream marketers to strongly agree that first-party data is a strategic asset. This doesn’t come as a surprise since these insights allow you to continuously improve your understanding of what people want and ensure growth.

Our article about 360 customer view covered why it’s crucial to empathize with your customers to achieve brand loyalty. Loyal customers interact with a brand longer and develop closer connections, opening a path to gathering quality first-party data. You can then use these insights for future customers, as they’re more relevant, accurate, and precise.

Unique insights are benefit number one of first-party data. They enable companies to develop tailored and targeted customer experiences.

This information is free and belongs to your company only, making your first-party data an invaluable competitive advantage. If you want to understand your customers’ needs and habits, these insights are your best chance.

First-party data includes:

  • information in your CRM software
  • information that you acquire while tracking actions and behaviors on your website or app, such as the time customers spent browsing or shopping cart items
  • information you collect from your social media channels
  • survey responses
  • customer feedback

Customers usually provide this data to get more personalized products and services. That enables marketers to respond to their customers’ expectations and address their pain points in a more meaningful way.

In the next section, we’ll talk more about how you can collect first-party data from your customers.

How to Collect First-Party Data?

Marketers can use various methods to collect first-party data. Many of them are automated processes done by your website or social media insights tools. But they can only tell you how your customer behaves, not the why behind it.

The following are some of the most efficient approaches to get your customers to openly share their data with you, providing you with more context.

Create Interactive Content

When you create engaging and unique content, customers are more willing to share valuable insights. These can include fun online surveys and quizzes inviting visitors to interact with your brand.

Most companies focus on publishing white papers, blogs, and newsletters. But these aren’t efficient information sources, nor can they entertain your customers as much as an interactive approach.

The goal is to have well-thought-out, open-ended questions that encourage people to share data regarding their purchasing tendencies, product preferences, demographics, and budget. Their responses will help you understand crucial customer characteristics and personalize your offering.

Leverage Lead Gen Forms

Lead gen forms are templates you can attach to different content formats such as a carousel, image, video, conversation, and message. Once customers click on the call-to-action, the form will automatically introduce their profile data and provide valuable information.

Various channels allow this option, including Facebook, LinkedIn, Quora, and Google. Depending on your brand and marketing strategy needs, you decide how much information you ask for.

Encourage User Registration

Many companies forget to leverage this option or believe it would deter visitors from staying on the website. But enabling them to register gives you access to stellar data and helps you establish a customer pool.

However, it is true that getting people to register can be challenging. So, be creative and offer discounts or other benefits for visitors who create profiles on your website.

Enable Different Sign-in Options

Allow Single Sign-on (SSO) and suggest your visitors sign in with their Facebook or Google accounts. As a result, they will get faster access to your products, services, or content.

On the other hand, you will get useful information such as their profile URL, location, interests, and other relevant characteristics.

How to Fully Take Advantage of Your First-Party Data

If you want to get the most out of your first-party data, the main question you need to answer is: how will you use it to achieve your marketing objectives? That decision will determine the kind of information you collect and the methods you use.

Perhaps you want to reduce customer churn, establish brand awareness, or gain more qualified prospects. Create a thorough plan on how you’ll collect first-party data and use it for marketing personalization. For example, you might want to leverage tailored product suggestions, account-based marketing, or retargeting.

Marketing automation plays a huge role here, as it allows you to leverage your customer data and engage with them on their terms – using the channels they are already on. And with the onset of generative AI in marketing, your first-party data and automation efforts will become more crucial than ever before.

Another thing you should consider is compliance. Be transparent about collecting the first-party data and how you plan to use it.

Your customers and website visitors should know what you do with their personal information and how that benefits them. Moreover, they should understand how you store data and whether these processes align with relevant internet regulations in your country.

Using a customer data platform is one way to make sure you follow all the relevant regulations. These solutions unify your customer data while having powerful regulation tools embedded in them, ensuring you use the data thoughtfully and risk-free.

Finally, it’s crucial to track and measure your efforts. Some strategies might fail, but experimenting and tweaking your approach will help you make the most of the first-party data.

Second and Third-Party Data in the Cookieless World

The end of 2023 is set to end the era of third-party data and the beginning of a cookieless world. The imminent changes will shake the digital marketing industry and remove the well-known cookies from Chrome.

Google will abandon its information facilitator position and place first-party and second-party data at the forefront. As a result, companies will have to transform and reinforce their marketing strategies and focus on establishing second-party collaborations.

Mutual agreements that typically include contracts will allow marketers to share their first-party insights with other professionals and agencies. These partnerships will be more efficient among companies with similar clients and business needs.

As a result, second-party data could enable marketers to tap into new audiences and markets. But they will also have to improve their contextual advertising and publisher targeting efforts.

Although the cookieless future will force companies to adjust to new rules and overhaul their strategies, their success will still depend on their ability to adapt and embrace transformations.

Of course, the end of third-party data doesn’t mean that all is lost. Digital marketing is simply transitioning to a new era, and those willing to change will find it far less challenging to navigate.