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Brand Strategy >October 13, 2021

Zero Party Data: How Can It Benefit Your Brand Strategy?

October 13, 2021
Maddie Duke
Maddie Duke
Freelance Marketer

B2C marketers want to deliver personalized brand experiences, but are often stuck using incomplete or inaccurate data to infer what consumers want or need. And with new regulations such as the CCPA and GDPR giving consumers more control over their personal data, the challenge for brand marketers is to find a way to provide accurate and relevant personalization, while protecting and respecting a customer’s right to data privacy.

This is where zero party data comes into play.

With zero party data, it’s possible for marketers to capture data that’s shared willingly and intentionally by consumers. By collecting and using this data in intelligent ways, you can provide rich and memorable, tailored interactions for your consumers.

In this article, we explain what zero-party data is, why it’s important, and how it can be collected and used by brands to provide memorable and accurate personalized brand experiences.

What Is Zero Party Data?

First coined by Forrester Research, zero party data refers to “data that a customer intentionally and proactively shares with a brand, which can include preference center data, purchase intentions, personal context, and how the individual wants the brand to recognize her”.

Zero party data is perhaps best understood in comparison to its siblings — first, second, and third party data.

First Party Data

First party data is information collected directly from customers via their behaviors, actions, and interests, as demonstrated across your app or website, as well as via subscriptions and lead capture forms. Transactional data, such as purchases or downloads, as well as things like how long someone spends hovering over a certain image or viewing a particular product are all considered first-party data.

Privacy concerns surrounding first party data are minimal, as you know where it came from, when it was gathered, how it is stored, and you’re in control of how it’s used. The challenge with first party data is that we have to make inferences about customers based on their behavior, so we’re not getting a complete picture of what a customer’s true intentions are.

Second Party Data

Second party data is essentially another company’s first party data that they share with you. You may purchase access to second party data sets that represent similar groups of people as your audience segments and use that to inform your marketing activities.

Third Party Data

Third party data is information that’s pulled from various platforms and sources, then aggregated and sold on to other companies. Third party data providers do not have a direct relationship with your customers. You can’t really know where third party data has come from, or when, where, or how it was collected.

Governments and tech companies, such as Apple and Google, have begun to regulate and limit the way customer data is collected, stored, and used, which presents a substantial threat to third party data. By 2022, more than 85 percent of internet browsers will block third-party cookies.

With marketers increasingly unable to access third party data, and only one third of customers believing that companies are using their data responsibly, brands must find new ways to gather valuable information about audiences in order to stay competitive and continue to create, segment, and target audiences with personalized brand experiences.

The Benefits Of Zero Party Data

Since zero party data is shared proactively with you by your audience, it’s more compelling both in terms of privacy and accuracy, but it has other benefits too.

1. Increased Trust

Privacy and trust concerns are minimal, since the customer explicitly consents to providing their information and you’re forced to ask permission and always be transparent about why you collect data.

2. No More Guesswork

Insights gleaned from zero party data are more accurate, as the customer is giving you self-reported information, rather than you making inferences based on their on-page or in-app behavior.

3. The Data is Unique

The second and third party data you access is likely being accessed by your competitors, too. Shifting your focus to zero party data means that you’re working with unique data captured directly from your customers.

So, how can we collect and use zero party data in our marketing strategies to create better brand experiences?

Integrating Zero Party Data Into Your Brand Marketing Strategy

Collecting Zero Party Data

Marketers can create interactive experiences across brand channels to collect zero party data quickly and at scale. Here are some popular methods for collecting zero party data below.

Polls and surveys:

Placed in strategic locations across your app or website, a simple poll or survey allows you to ask information directly from a customer at a relevant point in the customer journey.

Take the example of when a customer fills and abandons a shopping cart. With first party data, you could make an assumption that they’re interested but not yet ready to buy. By polling them, asking what stopped them from completing the transaction, you obtain zero party data that tells you whether a customer found a better solution elsewhere, whether they were just browsing, or whether the price was too high.

Preference centers:

Brand communications preference centers can be a great way for customers to share with you their specific interests, providing you with an opportunity to better understand their needs through zero party data.

If a customer of a sports retailer specifies they’d like to hear about football and roller skating but not about swimming, that retailer gains zero party data on that customer’s interests and needs.

Quizzes and personality tests:

Zero party data containing complex information can be collected via a more comprehensive quiz or test relevant to your audience and your industry. A mattress and bedding retailer might ask a series of questions around comfort preferences and sleep habits to determine what kind of products would be most relevant to them.

Seeking help from experts:

Zero party data can be collected on your behalf via companies that have perfected the art of creating engaging customer quizzes, polls, and surveys. By integrating and working with a product such as EnquireLabs or Prehook, you can make sure your zero party data collection is engaging, relevant, and effective.

With an AI-powered brand tracking tool like Latana, you can view your brand’s data from numerous target audiences and segments in one intuitive and customizable dashboard. This makes reporting and ad hoc research much easier. You define what matters most and gain full flexibility in your ability to explore the data and insights gathered for you.

Whichever methods you use, be sure to clearly state the purpose so the customer understands why the data is being collected. Two-thirds of customers would be happy to share their data, or would consider sharing data, if they got something of value in return. A customer should be able to easily see a potential benefit in return for providing their data, such as a more personalized brand experience.

Consider how you would use zero party data to create a valuable experience for your customers.

Creating Better Brand Experiences With Zero Party Data

Zero party data is only as valuable as you make it. It’s an opportunity to use what you learn to provide extra value through modifying and tailoring the brand experience.

Below are some clever ways in which zero party data can be integrated into your brand marketing strategy to create better, more personalized experiences.

1. Use Onboarding Surveys To Customize Experiences

You can collect and apply zero party data and immediately put it into action by modifying an app or website according to the choices your customer makes during an onboarding process.

Diet and weight management app, Noom, polls new users on several topics during the onboarding process, gathering information about their goals, challenges, lifestyle, and preferences and tailors their calorie plan accordingly, and setting them up with either a group chat or a personal coach. Users are asked if, how, and when they’d like to be nudged if they stop following the program, allowing them to categorize progress and success with the app in their own way. The way the app behaves is influenced by preferences customers provide via onboarding polls, and this is evident right away.

What questions could you ask your customers during the onboarding phase in order to present them with a relevant product experience?

2. Use A Quiz To Create Unique Shopping Experiences

Let’s return to the example of a quiz by a mattress and bedding retailer. A quiz asking visitors to the website to “discover your sleeping style” is one way to create a more unique shopping experience. Once a person fills out the quiz, you can present the most relevant products to them. “You mentioned you like a firm mattress with plenty of lower back support, these mattresses are great options for you!”.

One brand that does a fantastic job of creating a unique shopping experience through a quiz is bra retailer ThirdLove. A virtual fitting room takes customers through a series of questions and polls, inviting them to share their measurements, their unique features, and their preferences for style and fit. They can choose to keep shopping after they’ve found their size — which is a clever way to allow for survey fatigue — or keep going for a more comprehensive quiz. At the end, they’re presented with a selection of bras recommended for them, with their size and color preferences pre-selected. What a brilliant way to improve an often frustrating shopping experience!

Could you optimize the shopping experience for your customers with a quiz that saves them from sifting through products to find what they’re looking for?

3. Combine Lead Capturing To Engage In Personalized Communications (Without Sounding Creepy!)

By combining zero party data collection with lead capturing, you can start and continue a unique two-way relationship with your audience in a way that respects their privacy.

One issue with focusing on first party data is that when we make assumptions about a customer based on website behavior, it can come across as invasive — even if our assumptions are correct.

If you’ve viewed a pair of roller skates a few times but you’re not quite ready to buy, and you get an email or a message along the lines of “We saw you checking out those roller skates and thought you’d like to know they’re on sale”, it can feel a bit icky.

But if you’ve proactively told a retailer you like a product, you’ve intentionally shared that information with an expectation that it will come with some kind of benefit. That email suddenly becomes “We remember you told us you like these roller skates — they’re on sale!” It feels a lot more like a trusted, two-way conversation.

And it doesn’t only need to be about discounts or sales. If a customer was interested but not ready to buy, you can also ask a few more questions. Would you be interested in more affordable options? Better quality options? Different variations? You can let them know when a new model is released, and even invite them to a launch event.

We know that wherever a customer is in the brand funnel or buyer journey, they are of value to a brand. Finding ways to engage and delight them even before they’ve made a transaction helps to build a two-way relationship and increase brand affinity.

Could you use zero party data to change the way you communicate with your customers?

Final Thoughts

Zero party data is here to stay. With the deprecation of third party data on the horizon and increasing concerns for data privacy, understanding how to collect and use zero party data is the key to reducing your brand’s reliance on first and third party data.

By capturing consumer motivations, intentions, interests, and preferences in a way that respects their privacy and rights, and by applying it intelligently, you can build direct relationships with your audience and drive impactful personalized experiences across all channels.

Brand Strategy

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