1st party data, and why it matters to your marketing

Suppose you have a clothing store. You get a special shipment of wanted pieces, super exclusive and very easy to sell to the right people. However, you don’t have the slightest idea to reach them. Some customers might have bought from you before, but you’re not sure. Your best bet is to hire someone to hunt for prospects and spread your message. 

Paying somebody to reach your target audience is kind of like using 3rd party data in digital ad campaigns. You put in the parameters: male or female, age group, interests … then link a relevant asset and hit the play button. Voila - easy, cheap and effective.

I don’t want to argue against 3rd party data, but unfortunately there are two problems with it. The first problem is the legality. I’m not gonna go into details, but there are quite some issues with elements like GDPR compliance for example. Everyone's personal data is quite literally mixed in a huge data pile and sold to the highest bidder. The second problem? In a way, it’s too easy. As long as you can run your campaigns on cheap 3rd party data, why would you invest in your own systems? We know all advertisers end up doing the same thing, so it’s not really the best thing if you want to stand out.

As long as you can run your campaigns on cheap 3rd party data, why would you invest in your own systems?

But what if one day 3rd party data ceases to exist? By the way, this is a likely scenario. Now how will you run effective campaigns? The answer of course is 1st party data: your own data, that you collect in an ethical way. I’m afraid I can tell you one thing after many years of doing a lot of data-driven digital campaigns: there aren’t that many advertisers that have a decent data set-up.

Surprisingly, most advertisers aren’t aware because they did invest in data projects. In analytics and CRM. That’s fine and all, but depending on your plans it might not be enough. Analytics give you insights and insights might help you run better campaigns. CRM tracks the interactions with your customers and collects some personal data. It’s wise to run a good CRM campaign: based on what you know of a customer you can send them the perfect offer via email, or you can call or send them something in the mail. Maybe this approach is scalable and customizable, but probably not. We could call this your “own media.” You control the relationship A to Z.

If you want to go broader, you have to expand your data strategy by collecting and structuring interactions of clients and prospects then link this data to a campaign set-up. Here it would make sense to use your own 1st party data instead of 3rd party data, and feed the results back in your system, enriching the data further. It’s a change of strategy: in a 3rd party set-up you use public available information with the tradeoff that the information your campaign generates is not yours, but rather fed back into the “public” system (which is, of course, not owned by the public).

I think it’s time for advertisers to take their 1st party data seriously. Not only will it allow them to do way better campaigns (there are many cases to prove this), it’s also the only future-proof set-up that will keep afloat after 3rd party cookies get killed or blocked (already happening). It’s a way to show respect to your customers and prospects. At least they know you are respecting their privacy and addressing them in a transparent way. Besides that, you won't make your insights available to the competition.

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