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First Party Data in Marketing

We know businesses always try to convert their visitors into loyal customers.

And with your business, you’re no different. Providing for users is a long-term goal; all successful brands go after it.

That’s why they ensure their users get everything they want and love.
But how do these brands know what their customers are crazy about?

Providing great solutions takes knowing your customers first, and collecting first party data is one effective way to do so.

Every interaction with your customer paves a path of opportunity to learn more about their behavior patterns, likes, and dislikes, which is literally everything you need to present an aha solution.

First Party Data is the present and future — for your business to reach the skies!

What is First Party Data?

I’m sure you’ve gotten the idea behind what first party data is, but let’s make it simpler for you to understand.

First-party data is the information collected directly by a business/organization from the audience, making it highly relevant and valuable as it’s specific to its users.

The data is obtained through several direct interactions between you and your audience.

First Party data can include;

Behavioral Data

  • Website interactions (i.e., pages visited, time spent on pages, actions taken)
  • App usage data (i.e., interactions with an app, including feature usage)
  • Email engagement (i.e., open rates, click-through rates, and interactions)

Transactional Data

  • Purchase history (i.e., items bought, purchase dates, amounts, and frequency)
  • Subscription details (i.e., subscription services, start dates, renewal dates, and types)
  • Service usage (i.e., usage levels, preferences, and payment history)

Demographic Data

  • Basic information (i.e., age, gender, income level, and educational background)
  • Geographic location (i.e., location or interaction with your business)
  • Family status (i.e., marital status, household size, and the presence of children)

Psychographic Data

  • Interests and hobbies
  • Lifestyle (i.e., travel preferences, entertainment choices, and more)
  • Values and opinions (i.e., attitudes and opinions that can influence their buying behavior)

Device and Technology Usage (e.g., Device types, Browsers and operating systems, Connection type, and speed)

Customer Feedback (e.g., Survey responses, Customer service interactions (i.e., customer inquiries, complaints, and feedback), Reviews, and ratings)

Social Media Engagement (i.e., Interactions on social platforms, User-generated content)

Do you believe first party data is accurate? We say absolutely yes!

That’s because of the trust from both parties, where customers willingly share information, and brands receive it with lots of accuracy that will, in the future, become a powerful asset to their business.

There’s no third party involved here, so the data you receive has no impurifications — it’s just you and your users!

However, not all users are comfortable with giving out details to companies; that’s why companies need to follow privacy obligations and need users’ consent before using even minor details.

Why Is First Party Data Important?

Customer’s data → an asset to brands, why? Let’s find out;

  • The first and foremost reason would never change—High accuracy and relevancy.
  • Cost Effective—as it has lower costs compared to purchasing third-party data.
  • More effective for targeting and personalization strategies.
  • Generally considered as more compliant with privacy regulations.
  • Helps in making informed business decisions.
  • Leads to enhanced customer segmentation.

How To Collect First Party Data?

Through;

  • Sign-ups and registrations (i.e. account, newsletter, or service)
  • Purchases and orders (i.e. what was purchased, when, and for how much)
  • Surveys and feedback forms (i.e. polls)
  • Social media interactions (i.e. comments, likes, and shares)
  • Support tickets and chat logs
  • User behavior on websites and apps ( e.g. pages visited, time spent, and actions taken)
  • CRM (Customer Relationship Management) systems
  • Call centres

5 Best Practices To Collect First Party Data!

There’ve been many issues where data is breached and sold to different parties in exchange for bucks, leading companies to lose trust. Collecting first-party data effectively and responsibly is important to leverage your customer insights while maintaining trust and compliance with privacy regulations.

Here are some best practices for first-party data collection;

Ask For Consent First

Consent management is a process you need to be aware of. This involves obtaining, managing, and documenting user consent for collecting and using their personal data.

These systems typically include features such as consent forms, preference centers, and tracking mechanisms to record and manage user consent preferences to adhere to data regulations—the General Data Protection Regulation (GDPR) and to build trust with your users by respecting their privacy preferences.

Transparency Is Key

It involves being open and honest about what data you’re collecting, where you’ll store it, how you’ll keep it secure, and how you plan to use it. This transparency helps build trust and reassure customers that their privacy is respected and their data is handled responsibly.

Need For Value Exchange

Make your audience understand the worth of value they’ll get in exchange for their personal data. (i.e., offering incentives, benefits, or valuable content to users in return for their consent to share their information or participate in activities such as surveys, sign-ups, or interactions with the brand.)

This kind of deal breaker enhances engagement and encourages users to share their information willingly, ultimately leading to more meaningful relationships.

Data Security and Privacy

Collect only the necessary data for the purposes you have communicated to the user. Also, assure them with solid security measures to protect their data from unauthorized access.

Ensure Data Quality And Accuracy

Always prioritize collecting data that is directly relevant to improving customer experience and achieving business objectives.

Regularly revamp and verify the data to ensure its accuracy and usefulness. Make sure your data is accurate, reliable, and current by double-checking it.

Incomplete or inconsistent information can lead to misleading or biased insights. Establish a system to manage the marketing data you collect and store.

First Party Vs Second Party Vs Third Party Data!

First Party DataSecond Party DataThird Party Data
First-party data is the information collected directly by a business/organization from the audience, making it highly relevant and valuable as it’s specific to its own users.Second-party data comes from a direct relationship between two parties where one party agrees to share its first-party data with the other, often through partnerships, collaborations, or direct agreements, with both providing consent.Third-party data is information owned by the third-party data providers and can be accessed by any company willing to purchase it, not just the one that collected it.
Direct interactions with customers (websites, apps, CRM, etc.)Indirect customer relationship & directly from another organizationVarious sources, aggregated by third-party companies
Collected through customer’s engagement with the brand’s own channelsPurchased or shared through partnerships or agreementsCollected from multiple sources by entities that do not have a direct relationship with the data subject
High accuracy and reliabilityHigh to moderate accuracy and reliability (As the data originates from a trusted source’s first-party data, it’s generally considered to be of higher quality and accuracy compared to third-party data obtained from external sources.)Low accuracy and reliability
High privacy compliance due to explicit consentRequires clear agreements on usage, sharing, and compliance with privacy lawsPrivacy and compliance can be challenging due to less direct consent and potential for outdated or inaccurate data
High potential for personalization (based on actual behavior and transactions)High potential for personalization (if the data complements the company’s own data effectively)Moderate (useful for broad targeting but lacks precise personalization)
High trustModerate to High (trust depends on the partner’s data quality)Low to Moderate (lacks direct relationship with the data subject)

How To Use First Party Data To Improve Your Marketing Strategy?

Using first party data to enhance your marketing strategy involves leveraging the direct insights you’ve gathered from customer interactions. Here’s how you can apply this data to refine your marketing efforts and drive more effective outcomes;

Identify and Collect

Before using most of it, identifying the main objective of the data is important. Plan out what you would like to leverage the data for!

  • Do you want to analyze the data?
  • Do you want to improve user experience on your website?
  • Or make personalization precise for every customer?

Once you know the main goal of collecting first party data, you’ll better understand what to do next, which user segment to target, and much more.

Merge First Party Data into a CDP

Having data is not enough; understanding and taking action on it are the most prominent parts.

Using Customer Data Platforms (CDPs) can integrate data from all your sources (i.e., website, app, CRM, POS systems) into a unified customer database that has dashboards where you can easily convert complex data into digestible insights (e.g., particular user’s funnel).

This allows you to effectively use the data you got and fine-tune your marketing strategy.

Tools like Zapier or custom APIs can help sync data across platforms, ensuring your marketing tools have access to the latest customer insights.

Analyze Audience Behavior

Once you’ve unified all the data in one place, you can start analyzing user patterns and check out what needs to be done and improved, what can be done to drive more sales, what drives them to convert, what might be driving them away and much more (i.e., to achieve goals that align with your business).

You can analyze these common metrics like;

  • Conversion Rates
  • Bounce Rates
  • Engagement Rate
  • Traffic Sources
  • Type of Devices
  • Demographics

So, using this data, you can learn what strategies to implement and convert your traffic to loyal advocates.

Time to Implement

Understand Market Trends— the sales data and customer interests to spot trends and adapt your product offerings to meet market demands.

As trends change every 3 – 6 months, so do customer interests. That’s why tapping into the first party data helps us predict future patterns. It’s essential to analyze them first before implementing any targeted marketing.

Use First Party Data for Precise Personalization

If you’re not using the data to personalize, then what’s the use of it? You can utilize platforms to

  • Segment your email lists and tailor email content, subject lines, and offers based on each segment’s characteristics and behaviors.
  • Recommend products based on the visitor’s past behavior and preferences.
  • Send push notifications based on user preferences, location, or usage patterns, offering discounts, reminders, or personalized content.
  • Craft video messages or create content that directly addresses the viewer, enhancing engagement and connection.
  • Customize the content and promotions users see on social media feeds based on their interactions with your brand.

All are based on first-party data.

Optimization of Ad Targeting

Use your first party data in digital marketing platforms, including Facebook Ads or Google Ads, to create custom audiences. Personalize your ad creatives and messaging to match the interests and behaviors of these audiences, those who have visited your website tailored to their interests and the pages they visited.

Conduct A/B Testing Based on Customer Insights

Use platforms like VWO or Google Optimize to test distinct versions of your website, emails, or ads.

Segment your tests based on first-party data to see how different user groups respond to variations in your marketing. The one that performs better has a higher chance of an effective and successful first party data marketing strategy.

First Party Data Is The Present And Future

In the debate of third party cookie vs first party cookie, marketers increasingly rely on first party data to gather valuable insights directly from their websites, as third party data face growing restrictions and privacy concerns.

At this time, if you’re not leveraging first party data, you’re missing out on effective marketing strategies and the trophy to eventually increase sales!

Rishi Thakker

Rishi Thakker

Rishi Thakker is the founder and CEO of Huptech Web, an eCommerce development and marketing firm that helps companies attract visitors, convert leads, and close customers. His unique writing tips give startups and well-known brands a palpable action plan full of innovation unmatched.

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