What Is
Zero Party Data?
And Why Does It Matter?
How often do companies seem to not know you, even long-after you’re a customer?
How often do you see irrelevant content, offers, and ads?
Zero Party Data is a key part of improving that.
What is Zero Party Data?
Zero Party Data is the data resulting from when a user intentionally and proactively shares their info with a brand. It can include preferences, purchase intentions, feedback, personal context, and how the individual wants the brand to recognize and communicate with them.
As consumers…
As consumers, we want brands to know us so they can treat us appropriately. Provide great service. Offer products and services that would be valuable.
As marketers…
We want the exact same thing consumers want! We want to provide world-class personalized service so they become loyal advocates. We want to spend our limited resources offering products that will be well-received.
The mission to improve personalization isn't new.
The problem is how it’s been done.
It’s kind of creepy.
Every time you view an ad, open an email, visit a webpage, or use an app, you create a trail of log data. Many consumers feel this practices crosses a line when it is shared across websites and companies, stitched together, and harvested to try to create higher performing marketing without the knowledge or consent of the consumer.
Consumers want relevance. But without the creep-factor.
In reaction to these practices, much of the world created privacy laws to limit the shady stuff. Most browsers have or are about to disable 3rd party cookies, the key mechanism of sharing data across different websites/domains, by default. That even includes Google and its Chrome browser, which owes a significant chunk of its revenue to 3rd party cookies.
In short, the creepy era of providing personalization is coming to an end as we know it. So consumers and marketers alike need a better alternative.
Enter Zero Party Data.
A Quick Primer on Data Types
Customer data is the underlying fuel for personalization engines, whether that is on-site personalization, email personalization, or paid media personalization. Each data type is sourced differently.
Zero party data is unique in that it is voluntarily provided by consumers and often includes information that they actively want to share with a company, such as preferences, autobiographical data, and opinions. This type of data is considered to be the most valuable as it is directly from the consumer and can be used to personalize marketing and improve the overall customer experience.
First party data is collected by a company from its own sources, such as website analytics and customer purchase history. This type of data is also valuable as it is directly from the company's own interactions with the consumer and can be used to better understand consumer behavior and improve marketing and sales strategies. But it lacks explicit intent -- what's inside a user's head. So companies need to infer meaning from the data, which comes with value judgements, errors, and inaccuracies.
Second party data is data that is shared between two partner companies.
Third party data is data collected by a company from external sources, such as data from market research firms or data brokers. Third party data is on the endangered species list - it's largely enabled via 3rd party cookies which are being phased out of most browsers and was already perceived to be noisy and inaccurate.
ZPD: The concept isn’t as new as the name
The term Zero Party Data is relatively new, but basic attempts to capture it have been in place for a long time.
But at the same time, the predecessors aren’t the same thing as modern Zero Party Data.
What’s missing from the old school examples?
- They’re static. They’re always gonna ask the same stuff.
- They exist at a small number of customer journey touchpoints, like initial onboarding. But they're not used holistically across relevant customer journey touchpoints.
- They’re typically slow/expensive to update and maintain.
So What’s The Modern Zero Party Data Vision?
Take 👆 the one-off v1 attempts at explicit customer data capture and reimagine it as a leveled-up core component of the enterprise marketing stack. That is, the practice of collecting key information directly from users, naturally over time, like humans build relationships in order to best serve the user.
- Ask questions of your users in any relevant moment of their user journey, in any channel they happen to be interacting with your brand in.
- Centrally controlled — what to ask, which channels, which moments, and which creative.
- Highly targeted and arbitrated. Collect data in an order that makes sense based on what else you already know.
- “As content” - customer data capture is natively embedded into the experience such that it feels like it was always meant to be there.
- Easy to change over time - capture new data, reprioritize existing data, change where you ask and how you ask.
- Easily transform and route the data for activation - whether that’s to internal systems, APIs, CDPs, CRMs, Emails systems or more so you can use the data.
In summary, it’s taking the immature v1 examples of collecting explicit customer data and preferences and elevating it to a true first-class enterprise capability that enables world-class customer experience and personalization.
What are some examples of how I might collect and use Zero Party Data?
Capture communication preferences
Capture category & product preferences
Capture customer data for segmentation
Capture enrollments in marketing newsletters
Capture enrollments in servicing features
Capture demographic and psychographic data
In summary
The changing privacy landscape and increasing consumer demand for personalization is driving Zero Party Data into the spotlight.
Zero Party Data is valuable because customers explicitly give it with the intention of you using it.
Zero Party Data doesn’t replace other data types, but rather it augments & amplifies them.
Zero Party Data is win-win for consumers and marketers alike.