At a time when personal data is becoming increasingly difficult for companies to collect, the importance of zero party data is becoming undeniable.

In this article, we explain the differences between first and second party data. We also share their role in your marketing strategy and the most effective ways of collecting and activating them.

SUMMARY

• What is Zero Party data?
• Zero-party data vs first party data and second-party data
• How can brands use this type of data?
• What are the best ways to collect zero-party data?
• The challenges of zero party data

It’s the information that comes directly from consumers. Consumers voluntarily share personal data (such as contact details or purchasing preferences) with companies.

Zero-party data can be considered the least intrusive form of data collection. Users give their explicit consent by sharing it directly with organisations. But it’s also valuable information, collected directly at source.

Some people consider zero-party data to be conversational data. This is all the information that a brand could learn about its customers by talking to them about their background, their purchasing history, their preferences, etc.

By engaging in this type of dialogue with their audience brands create a bond with consumers. They are also able to enhance their customers’ opinions by offering them a better shopping experience and a more relevant offer.

Why is Zero Party data so important?

Marketing based on this data is more personalised and effective than marketing based on data that does not come from the main stakeholders.

But beyond these considerations about the quality and reliability of the data collected, companies will soon have few alternatives to zero-party data.

The collection of third-party data, in particular via cookies, is set to disappear. European legislation is increasingly restrictive in terms of confidentiality and respect for consumer privacy. But operating systems, including Apple and Google, also significantly restrict companies’ access to user data.

To give just one example, Apple no longer allows data aggregators and social media platforms such as Facebook and Instagram to collect data on iPhones and iPads. These account for around 60% of the mobile devices in use today.

First-party data

There is often a tendency to confuse the two, as zero-party data long been considered a subset of first-party data. However, it is now considered that first-party data is collected via a user’s standard interactions with its website, application or online payment module.

The difference also lies in whether the information shared is compulsory (e.g. address in the purchasing process) or optional (for zero parties).

When a customer fills in their address when completing a purchase this is first-party data. But if the company sends out a post-purchase feedback form asking customers whether they enjoyed their experience, this is zero-party data.

Second-party data

Second-party data is another company’s first-party data, which it has resold to other organisations. In the best-case scenario, this information comes from a partner:

• relevant (whose audience is similar to that of the company that purchased them)
• and trust (to ensure they are accurate and of high quality).

This data source helps to make up for a lack of information. It may be of interest to brands that have just launched or that want to conquer a new market. However, it comes at a price, requiring greater vigilance (to ensure compliance with the RGPD). Not to mention the fact that they will never be as reliable or as relevant as zero or first-party data.

There are many ways in which e-commerce and retail brands can exploit zero party data. Here are just a few examples:

• Propose more relevant content by finding out about the buying intentions and problems faced by prospects;
• Create personalised emailing flows to activate your prospects by sending them offers that match their interests;
• Understand what type of product/service/feature is of most interest to your audience and use this information to guide future innovations;
• Adapting your online or in-store experience based on the friction encountered by consumers. For example, a company may realise from its post-purchase form that delivery conditions are not clearly enough indicated during the ordering process. By adapting its payment form (for example, by adding this information at the first stage), it will be able to increase its conversion rate.

• The quiz : this fun format enables companies to gather detailed information about their customers’ expectations. For example, a beauty brand can offer a quiz to all its new visitors to diagnose their needs and guide them towards products suited to their skin type;
• Chatbots: conversational pop-ups enable brands to talk to their customers, offer them advice or inform them of any promotions they may be taking advantage of;
• Post-purchase surveys : sent in the order confirmation email, these forms are particularly useful for improving the customer experience. They can also enable the company to suggest more relevant additional sales. By making them attractive with a post-purchase game, brands can also hope for a better conversion rate.
• Polls on social networks: A simple and effective format for asking customers for their opinion. Polls are particularly effective on Twitter and Instagram, where they can be used to generate 20-40% engagement.
• Competitions: brands can also engage their community by offering them the chance to take part in a competition. To enter the competition and hope to win a gift or discount, players will need to enter their personal details;
• Marketing games. Certain Playable Marketing mechanisms (such as the battle, the gift finder or the swiper) can themselves be used to collect zero party data. By having to choose between two products/inspirations, consumers will tell the company what their preferences are.

The challenges of zero party data

It represents the future of data collection. But it also presents challenges.

One of the biggest challenges of zero party data is balancing personalisation and confidentiality. Companies must therefore ensure that they only ask for relevant information if they do not want to be seen as intrusive.

Attention should also be paid to addressing the issue of data security. It is crucial to put in place solid measures to protect your customers’ data from any cybersecurity breach (via encryption or the use of robust storage methods).

Finally, the question of veracity arises even with zero-party data. Even if it comes directly from customers, 36% of marketing specialists are concerned about their accuracy. To overcome this doubt, the solution is to offer an incentive whose value depends on the accuracy of the information shared.

For example, the more honest a customer is about their preferences or needs, the more likely the brand will be able to make relevant product recommendations. There are also tools that can be used to check emails and postal addresses to ensure that valid data is being collected.

Collecting zero party data means increasing the number of interactions with your audience. To make it easier for you to communicate with your customers, rely on our Playable marketing mechanisms to make sharing information more fun and engaging!