In today’s data-driven world, businesses rely on data for decisions in branding, marketing, sales, communications, IT, legal, new product development and operations. As the reliance on third-party data faces challenges, first-party data stands as one of the most valuable assets a business can own.

Data is crucial in every business area and for the past decade, many companies have leaned heavily on third-party data for growth. However, tides change swiftly in the digital world and the focus on first-party data is proving more reliable, valuable and strategic.

Let’s dive in and take a look at the data sources available to organisations. Then, we’ll provide a link to real-life case studies that highlight how and why first-party data can provide a sustainable competitive advantage.

Data source categories

Internally managed:

Zero-party data – The data that a customer intentionally and proactively shares with a brand such as a survey, poll, quiz, or preference centre data. It’s soliciting a direct interaction with a customer.

First-party data – The data that your organisation collects from your channels and sources such as website behaviour, email interactions and purchase activity. How you leverage this information can provide both individual consumer and demographic-wide data points.

Externally managed:

Second-party data – The first-party data that another company collects, packages and sells to you. This includes Google Affinity Audiences or another business selling their subscriber list or data to you. Scale is an upside of this approach, with the ability to reach a bulk audience that may contain new leads.

Third-party data – Similar to that of second-party data however this is aggregated data collected from multiple data sources that are packaged and sold by a company that did not collect the data itself. Keep in mind the source of the data is often unknown and, like second-party data, there is a good chance your competitors may have acquired the same list.

The shift from third-party to first-party data

Marketers have long used third-party data with its low entry barriers and quick results. It provides insights beyond basic demographics which make it a key marketing tool. However, the third-party data market is facing significant challenges:

• Exhausted early mover advantages: Costs have risen as more marketers compete
• Privacy and compliance concerns: Increasing regulations make third-party data less viable long-term

The power of first-party data

First-party data offers unique, long-term value because only you have access to it. Insights come directly from your interactions with customers, ensuring compliance and trust. Customers can opt out of data collection, maintaining privacy.

Most marketers refer to zero- and first-party data as “first-party” and second- and third-party data as “third-party”. Managing zero and first-party data requires more effort but yields valuable insights, helping businesses maintain a competitive edge.

Benefits of first-party data

• Personalise marketing to the individual consumer
• Re-segment leads by pre-designated triggers
• Identify new consumer demographics
• Target the right consumers for the right products
• Ensure aligned product and service evolution
• Inspire new products and services
• Reduce marketing costs while increasing revenue
• Curate regional marketing strategies
• Implement franchise and local area marketing
• Ensure transparency and consumer privacy
• Design integrated multi-channel marketing
• Identify each consumer’s preferred communication method
• Perform multi-channel customer journey mapping
• Perform customer lifetime value modelling
• Generate advanced ROI analysis
• And more.

The Taguchi spinning plates methodology

Successful data-driven marketing incorporates five key components:

• Comply: Adhere to privacy and spam legislation
• Acquire: Cost-effectively add subscribers and maintain quality
• Maintain: Regular database hygiene and monitoring
• Execute: Optimise engagement frequency and automation
• Reflect: Review metrics and make necessary changes

For instance, poor email campaign performance might be due to list residency rather than content issues. Monitoring nuanced metrics can drive acquisition strategies and improve ROI.

Automated but ongoing

A successful first-party data program is never ‘set and forget’. For a variety of reasons, programs once established can often stagnate and fail to live up to the business’s expectations. Like the art of spinning plates, the setup is just the beginning of a successful performance. Although the most obvious impacts may happen in the early stages of a program, delivering a sustainable long-term competitive advantage requires continuous monitoring, refinement, and improvement.

To keep your ‘plates spinning’ you’ll need the right:

• Skills: Incorporating both internal and external expertise
• Focus: Optimisation of the five key components to continually align them with corporate objects
• Platform: Engaging a sophisticated and trusted technology partner. Taguchi offers an industry-leading marketing automation platform as well as a strong team of industry experts to assist you to continue spinning these plates

With these insights exclusive to you, competitors can’t leverage the same preferences and behaviours.

Discover real-life case studies on the Taguchi website. Taguchi are the first-party data experts, offering a distributed customer engagement platform solution to some of Australia’s top brands. Contact Taguchi to learn more about their digital marketing solutions.