Data is the cornerstone of any retailer’s success. Whether you’re refining marketing messages or monitoring inventory levels, a solid foundation of high-quality, first-party data is essential. However, not all data is the same. Data can be classified into three (or sometimes four) types: first-party data, second-and third-party data, and, most lately, zero-party data.
Let’s begin by looking at the three types of data:
- First-party data is information gathered about your target audience based on their interactions with your website or app. This information is valuable and has few privacy concerns.
- Second-party data is information gathered by one firm and then sold or shared with another non-competitive organisation (for example, an email list).
- Third-party data is information gathered from a range of other sources by a corporation that has no direct relationship with the person whose data is being gathered.
- Zero-party data is that which a customer intentionally and proactively shares with a brand.
“The whole infrastructure behind third-party cookies has become unwieldy,” said Salesforce senior vice president Marty Kihn. “It’s time for a rethink and a reset. I’m optimistic about what comes next, but the transition period is very uncomfortable.”
Let’s start with the most important: First-party data.
What is First-Party Data?
For several months, Hayden Blades has considered purchasing a new smartwatch to track his calories. He came on your website while searching online and has spent hours comparing brands, features, pricing, warranty, and other factors in order to determine which one he wants to purchase. Because you provide so much guidance and information, your website is one of his favourites for research. He even downloaded your mobile application and subscribed to your newsletter.
He was out on a walk one day and happened to pass by your store. Since he has an account through the mobile app, the app detects his proximity to a store and gives him a notification that the smartwatch he has spent the most time evaluating is on sale in the store. He enters the store and purchases it. This is what first-party data is worth.
Today, 62% of retail shoppers believe brands must provide personalised experiences. With so many people looking, researching, and purchasing things online, real-time personalization has proven to be a useful tool for increasing consumer engagement, loyalty, and purchase intent.
It is the data that a person entrusts to you in return for your better product or service. And it’s the only data that provides the insights and controls you to recognise, relate to, and answer to your consumers in more meaningful and useful ways.
While leveraging first-party data to market to known consumers is not a novel notion for retention efforts, the technique to do so is. Because of the advancement of customer intelligence systems provided by Salesforce Commerce Cloud – SFRA feature; retailers can now combine all of a brand’s offline and online first-party data to reach and engage real consumers wherever they are in their decision journey.
Tie your data together using a customer data platform (Unify)
The following are examples of first-party data:
- One-of-a-kind visitors and interactions.
- Demographic data (includes age, gender, income, education, employment, etc.)
- Buying history
- On-site time and more!
Once you’ve gathered your first-party data, you’ll need an approach to manage it effectively, which is where Customer Data Platforms (CDPs) come in.
CDPs are a form of software that collects customer data from various data sources (including first, second, and third-party data) and software (including CRMs, DMPs, data lakes or warehouses, websites or mobile applications, and/or POS systems). The data may then be organised into central customer profiles and made available to other apps.
Users may then utilise these customer profiles to generate audience segments (often using machine learning provided by Salesforce Commerce Cloud) and activate them across additional channels such as SMS marketing, paid advertising, customer support tools, and website personalization.
Data Flywheel: Build a foundation for long-term success
Build an agile, responsive marketing and learning organisation using the data flywheel strategy. According to the flywheel idea, every action taken by a business based on a consumer data insight creates a new customer experience. Every consumer interaction creates additional data. This information might include what someone clicks and opens, as well as how customers react to more complicated engagements with owned and sponsored media assets.
First and foremost, your efforts result in growth. Your progress will then yield exponential profits.
As the data flywheel spins, your fuel becomes richer, your insights get more solid, and your actions become more powerful. You tap into the consumer’s dynamic context, strengthen your first-person data, and launch a direct-to-consumer (D2C) initiative.
First-party data is essential for success
There is no doubt that high-quality data is critical to your organization’s success. Without it, you don’t fully know or understand your customers, and you’re hoofing it when it comes to what will attract them to buy from you. However, keep in mind that your data is only as good as your management of it, so you must design the best plan for collecting, storing, managing, and sharing your first-party data across the organisation so that every department delivers consistent, relevant, and meaningful customer experiences… And Salesforce Commerce Cloud has it all!
Retailers who do not maximise the value of their first-party data are passing up major possibilities to provide exceptional customer service. Retailers must do so because happy customers are everything – after all, acquiring new ones costs six times as much. First-party data should be seen as the premium fuel for customer retention that generates relationships and sales by today’s retailers.
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