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What is Zero Party Data?

Experts say data is the new oil, but are you using all its types? Consumers demand more privacy as old and sweet cookies are slowly dying in response to privacy advocates winning the battle over third-party cookie tracking. Read more about cookiepocalypse in our blog – Google’s Cookiepocalypse in 2023 and How to Prepare Your eCommerce Website. As Google is slowly phasing out third-party cookies, zero-party data, perhaps the most overlooked data type, is gaining brands’, advertisers’, and marketers’ attention, so now you might want to learn more about it.

Zero Party Data: Definition

Zero-party data is information consumers willingly and proactively share with a brand, and it can include their demographics, shopping preferences, purchase intentions, personal contexts, pain points, contact info, and how they want to be recognized by the brand. 

Is it the Same as the First-Party Data?

Zero-party data is significantly different from first-party data. The primary difference between zero-party and first-party data is how they’re collected.

First-party data is information you can collect through channels and properties you own. These include your website, email, social media, surveys, etc. You can accumulate data about the actions consumers take on your site and other channels, such as which products they browse or which of your messages they open to read.

Even though first-party data should be an essential component of your marketing and personalization strategy, you shouldn’t rely only on it. When consumers take action on your channels, they don’t think about what these communicate to the brand. They might remove an item from their cart only because they accidentally added it there, not because they weren’t satisfied with your delivery options. If you ask the consumer why they removed the item from the cart and provide you with an apparent reason, such as accidentally adding it, it’d be zero-party data. First-party data relies on consumers’ interactions with your products without a context; thus, it doesn’t provide a complete picture of their needs and preferences. 

Zero-Party vs. First, Second, and Third-Party Data

  • Zero-party data: It is Information customers proactively share with companies after they are asked to do so through surveys, pop-ups, or other methods.
  • First-party data: It is behavioral information companies collect through channels they own.
  • Second-party data is information from another company’s first-party data others purchase with permission to use. 
  • Third-party data: Third-party data is information you collect without a direct relationship with consumers, such as buying it from data aggregators.

What Makes Zero Party Data Stand Out?

Zero-Party data has many benefits, including trustworthiness. When a brand initiates direct communication with customers to learn about their needs and preferences, they are more likely to trust such a brand. Another reason why zero-party data is better than other types of data; is the accuracy. Because you acquire the information directly from customers, it doesn’t require a guessing game as first-party data does. 

Is First-Party Data Still Important?

Even though zero-party data is crucial and beneficial, it can’t replace first-party data, and they both are equally essential to have in your marketing strategy. First-party data serves as a foundation for your personalization strategies, while zero-party data brings new opportunities for your brand to deliver even more personalized and relevant experiences. 

Why is Zero Party Data Important for Brands?

Zero-party data is vital for brands as it minimizes their dependence on third-party advertisers and data aggregators. Besides, zero-party data allows brands to build meaningful relationships with their customers based on personalization, engagement, and trust.

Most importantly, zero-party data enables brands to create highly personalized marketing campaigns for their customers to benefit from and meet their needs. With zero-party data, brands can personalize their email and SMS campaigns and make them more sophisticated than ever before.

Do Consumers Like Zero-Party Data?

Zero-party data is a double win for brands and consumers who want more personalized experiences to meet their needs. Consumers want to have direct communication with brands if it means less creepy data collection that will benefit both the brand and them.

According to this consumer behavior report, 71% of consumers want to share information with brands to get personalized recommendations.

55% of consumers also say they’ll share their information to feel like part of a brand’s community. 

Benefits of Zero-Party Data

Zero-party data comes with many advantages, including : 

  • Direct communication: When consumers share their contact information with you, you can initiate direct communication through email and SMS and engage 1:1 with them.
  • More accuracy: When you acquire information about your customers, there is no better information source than your customers themselves. Zero-party data is more accurate than any other data type as consumers share them with you directly. It allows you to gather clear answers to your questions and learn more about your consumers’ preferences.
  • Loyalty: Customers invest their time, energy, and trust in your brand when they get on board and share information with you. Once you provide them with relevant and personalized experiences, you build long-lasting, respectful communication with them. Utilizing zero-party data in your campaigns shows your customers you care about their needs and respect their trust in your brand, helping you build loyalty. 
  • Increased Conversions: Shoppers are much more likely to make a purchase when you’re recommending them one based on the information they provided. Personalization you achieve through zero-party data significantly increases conversions through email, SMS, or any other medium. Thus, you can generate more revenue. 

Do I need Zero-Party Data?

If you own a competitive business in today’s market, you need zero-party data regardless of what you sell. Online shoppers become more and more privacy-aware, so brands need to emphasize zero-party data. It will help them create trusted, personalized, direct long-lasting relationships with their customers.

Collecting zero-party data won’t raise privacy concerns, and customers will not have the ‘creepy’ experience they usually have with third-party data. Besides, it will allow you to provide customers with more relevant and valuable offerings, increasing conversions.

How to Collect Zero-Party Data?

Collecting zero-party data isn’t rocket science! And there are many different methods you can use. Find some of the best ones in our article 20+ Ways to Collect Zero Party Data.

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