‘Good’ Third-Party Data Rides to the Rescue
Those percussive sounds you hear are marketers banging their heads against the wall.
Why? Because consumers want more personalized offers and content, even as they are reluctant to provide information about themselves. In previous years, marketers could round out that picture with data gleaned from third-party cookies, such as browsing activity and purchase patterns, in order to create a profile for better targeting.
That kind of data is a dying breed and arguably not very effective and certainly not transparent for either the advertiser or the consumer. Whether you agree or disagree with that sentiment, browser makers and privacy laws will stomp third-party cookies into crumbs … eventually.
It’s a conundrum, and guess what? Consumers don’t care. These are issues for marketers to solve.
But there’s a way to rescue the marketer from this dilemma — by fully employing a “good” kind of third-party data.
Information from third-party cookies has gotten a bad rap and for obvious reasons. It has proved to be highly inaccurate and too often is a byproduct of tracking users without their permission.
Another kind of third-party data, however, does not track online user paths online, is very accurate, and lives independent of cookies. And this kind of consumer information can be used to turn a sliver of data into a richer profile ready for personalization, targeting, predictive analytics, and other use cases across the business.
The “good” third-party data comes from non-cookie sources, such as demographic maps, the use of discount and loyalty cards, public records about real estate transactions, and many other sources, because it’s diversified and anchored to real-world activity. And getting more contact points using third-party data doesn’t just help with marketing outreach, it also helps with linkage, deduplication, and updating or corroborating dated information.
What Do We Need? Brand Loyalty and Customer Acquisition
The current buzz among marketers emphasizes the growing centrality of first-party data, the information created and provided by the brand’s own subscribers and customers. First-party data is leveraged to build greater customer loyalty because keeping a customer who might leave is always cheaper than getting a new one.
But if current customers and new prospects are reluctant to share much information, marketers are limited in their ability to target their messages. Yet consumers now expect product recommendations, offers, and other communications that don’t waste their time, in large part because they regularly get this kind of personalization from Amazon, Google, Facebook and other walled gardens.
According to a study by Salesforce, 66% of customers expect brands to understand their unique needs and expectations. Gartner has found that personalized marketing performs eight times better than basic segmentation.
In other words, consumers are saying they want the brand to know their needs and desires even if the consumer is hesitant to give up more than one or two identifiers. And they’re not shy about quickly moving to a competitor.
Brand loyalty is disposable when the price and value of a competitor is just right, so marketers need to get creative. The central challenge: knowing each visitor’s main motivations and drivers to buy by knowing more about them.
Third-Party Data Fills Out the Picture
Let’s take as an example a home services company, one that primarily connect homeowners with top home service companies through online forms. Because many site visitors were abandoning the forms before completing them, this company requested less information from visitors to make the process quicker (ie. better and cheaper for the consumer) – just name, phone number, and zip code.
The shorter form boosted form completions and the consumer’s on-site experience, but it meant the business knew less about each homeowner. In this case, non-cookie-based third-party data could come to the rescue. The three pieces of submitted data were matched against third-party data to verify the user’s identity and to expand the profile with demographic and lifestyle attributes that helped shape a more relevant offer from service providers.
Employing quality third-party data to expand profiles does more than identify relevant offers even when consumers prefer to offer only minimal contact information. It also helps to remove duplicate profiles in a brand’s repository, an effort that is essential for keeping consumer data accurate and avoiding multiple pitches to the same person.
The data universe that has guided marketers for the last quarter century is changing quickly. While the end of third-party cookies can boost the importance of first-party data about one’s customers and visitors, it doesn’t mean that obtaining scalable, accurate data about non-customers and new visitors is out of reach.
“Good” third-party data can deliver a more accurate, more complete profile while alleviating the marketer’s headache.
Zora Senat is CMO at Infutor.