There’s no question that first-party data represents the “gold standard” of all the options available to marketers today. Since the chain of custody remains intact, there are no privacy concerns related to the data, which originates directly from consumers already familiar with the brand, therefore it’s typically the highest performing activation of all media programs.
As privacy concerns grow around second- and third-party data alternatives, first-party data—specifically PII (personally identifiable information)—is set to explode in popularity for high-performing brands. As you look ahead to 2020 and beyond, here’s what you need to know about the data you’re collecting, including major trends, and how you can adapt, prepare, and get ahead of the curve.
Why Is PII-Based Data the Best Option?
As mentioned earlier, first-party data is often the highest performing of all options, but PII-based data specifically takes this to another level. By using it in conjunction with an identity resolution platform such as Liveramp, marketers can resolve identities across platforms and create persistent, omni-channel conversations with prospects. Brands today are increasingly using this type of marketing as the technology continues to improve, but its adoption stands to accelerate further considering the upcoming trends and regulations that are taking off in the industry.
Current Data Trends
The most significant trends in data right now, whether first, second, or third party, revolve around ever changing privacy guidelines and regulations. This new era of privacy protections started in May 2018 with GDPR—the data protection and privacy regulations enacted by the European Union—and continues today, as several states in the United States said they’re considering similar legislation. One such example is the California Consumer Privacy Act of 2018 (CCPA), which will go into effect Jan. 1, 2020.
This legislation outlines new rules for consumer rights in California, and sets a precedence for the entire country to put ownership of data back in the users’ hands. When it takes effect, consumers will have greater control over what data is stored by a business, and how it can be used, including whether it can be shared or sold to a third party.
By targeting based on the behavior of a group or individual, rather than content relevance, marketers are able to create highly targeted ads, and drive improved performance.
There are many varying opinions on whether or not this regulation is too restrictive or lenient, but one thing is abundantly clear: This bill has major implications for businesses that are reliant on second- and third-party data. When users have more control over their information and its dissemination, many will likely opt-out, causing the available data pool for marketers to shrink. At this point, brands will have to supplement these programs with data-driven first-party campaigns, or return to less strategic media executions, such as contextual relevance, that aren’t driven by behavioral intelligence.
The problem with the latter is that they’re not as targeted or personalized, which leads to a significant drop in marketing program performance. For example, If someone visits a site with golf content, they aren’t necessarily in the market for a pair of golf shoes or a new set of clubs, so the correlation between contextual content relevance and an audience’s propensity to convert is significantly lower compared to data driven targeting strategies.
Data driven marketing doesn’t have this downside. By targeting based on the behavior of a group or individual, rather than content relevance, marketers are able to create highly targeted ads, and drive improved performance.
To maintain or improve performance today, brands need to stick with this data-driven approach. As second- and third-party data becomes less scalable, the spotlight will naturally shift to focus on driving conversions with first party data—and now is the time to get ahead on this trend. Fortunately, this approach comes with a host of ancillary benefits that can help marketers improve efficiency and succeed well into the future.
The Case for First-Party Data
As third party audiences shrink, increasing spend on in-house acquisition will help you get in front of more prospects with greater consistency, but attracting more eyeballs is just the beginning. Using first party data also powers addressable marketing campaigns, drives personalized experiences for consumers and improves measurability across channels. Together, these benefits create more engaging marketing campaigns for your potential customers and help you improve efficiency and ROI. Let’s take a look at these two benefits more in-depth:
When you know a consumer’s identity at an individual level, it’s much easier to serve them content that’s highly relevant. Usually if someone has opted in to your in-house list, they’re aware of your brand and have shown some positive interest, but they’ll likely need further nurturing before becoming an actual customer.
With consumer PII in hand, marketers can connect prospects to actions—such as viewed products or pages visited—and use this information to personalize the marketing experience. This first party data can be pushed into the digital ecosystem to help serve targeted display, video, or native ads, tailored emails, and personalized site experiences. No matter the medium, more relevant ads will drive higher engagement.
Of course, increased engagement will result in more revenue and higher efficiency, but how you get there is almost as important as the end result. Customers will appreciate the relevance and create valuable positive associations with your brand that will pay dividends over the long term.
True Omni-Channel Measurement
In addition to improved relevance and engagement, leveraging first-party data for acquisition empowers analytics and business intelligence teams to connect user paths and marketing data across all channels. By using PII-based first-party data, it’s possible to resolve identity and build a bridge from a user’s initial exposure all the way to conversion.
With this complete conversion map in hand, analytics and marketing teams can work together to optimize every step of the process and drive incremental improvements at each stage. No other type of data powers this level of insight.
The Bottom Line: First Party Data Is the Future
The entire marketing world is undergoing a significant transition as governments start to create legislation defining user data privacy rights. As this happens, marketers who were previously reliant on second- and third-party data for acquisition and growth, will be required to shift their strategies as the data pool shrinks. But this doesn’t mean your marketing strategy has to suffer. With first party data strategies growing increasingly popular and powerful every day, you now have the opportunity to build the highest performing campaigns you’ve ever created. The key is to shift your focus, find what works, and stay ahead of the curve.
If you’d like to learn more about how to cost-effectively acquire first-party data from high-quality consumers, contact us for a free consultation. Our lead-ad campaigns are the perfect source of highly-customizable, consumer opt-in PII for forward-thinking brands and businesses.