The original version of this piece appeared as an Econsultancy post.
The marketing shift is on this year as third-party cookies are being phased out in 2023. Growing digital privacy concerns are making it harder for brands to track consumers and gather the quality data they need to personalize their campaigns.
A new era of strategies is emerging to prepare companies for a world without cookies, as well as answering some big questions, such as:
- What can brands do to stay relevant and acquire customers online?
- What can you do to increase the effectiveness of your targeting strategies using customer data?
- How do you maintain a loyal customer base?
- What is the best way to create authentic experiences and gain consumers’ trust?
Marketers are increasingly turning to a higher-quality type of customer data referred to as zero-party data.
What is Zero-Party Data?
Zero-party data is information that consumers voluntarily provide brands in exchange for some type of incentive or reward, like a better offer or service. This type of data provides a more accurate depiction of a consumer because, compared to first-party data, it may provide an understanding of the consumer’s intent, such as what products are relevant to them. With zero-party data, you do not need to infer; you simply ask consumers questions to which they provide answers.
According to a recent survey by the CMO Club, more than three quarters (77%) of CMOs said they are investing more in zero-party data sources to acquire and retain customers. For nearly half of respondents, it’s a “lack of confidence” in the data sources they are currently using to create personalized and relevant messaging that is prompting this shift.
How Brands are Using Zero-Party Data
ThirdLove, a D2C apparel brand, is tapping into zero-party data with an approach that incentivizes consumers to provide personal information about themselves. The company asks shoppers to fill out a survey where they can share information that will allow ThirdLove to recommend the best-fitting bra. For example, depending on how the customer has answered earlier questions, they may be asked if they have lost or gained weight. Because a shopper knows their answers will lead them to a perfectly-fitting product, they are more willing to provide the personal information required.
ThirdLove also uses this zero-party data to help guide bigger business decisions. In one case, the company built an internal algorithm that uses data gathered from the surveys to inform supply chain decisions, such as how to manage inventory of particular sizes. It also helps ThirdLove understand how size trends change over time.
Another example is Shea Moisture, a hair and skincare company that runs contests to acquire zero-party data from consumers. In addition to encouraging shoppers to take a quiz that will lead to better product recommendations, the company gives shoppers the option to provide personal information—such as email address, zip code, and birthday—for a chance to win $100 off any order. In essence, the company is paying the shopper to provide them with valuable zero-party data.
Combining Zero-Party and First-Party Data
Other companies take a different tack in gathering zero-party data. As part of its OneASICS loyalty program, ASICS offers discounts to specific customer communities such as first responders and medical professionals. In order to qualify for the discount, the consumer must enter their name, email address, and the name of their employer in order to prove they are a member of the community.
ASICS was able to drive double-digit growth combining zero-party data with first-party data. The company paired together with both types of data—such as purchase information gathered on their site—to get a 360-degree view of customers across all DTC channels and platforms. This data also allows ASICS to deliver one-to-one content experiences for customers logged into the website or mobile app. And the program has been remarkably successful. When the company launched OneASICS, membership and loyalty members accounted for less than 10% of all ASICS purchases. Today, that number is more than 50%.
There are myriad ways to incentivize consumers to provide you with information about themselves, which you can then use across the business—whether it’s incorporating it into your ad models and direct marketing campaigns or informing what products or services you bring to market. What we know is that many customers are happy to share personal, zero-party data when a brand offers something of real value in return.
Are You Ready for a Cookieless Future?
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