A Guide: The Difference Between Zero, First, Second, & Third-Party Data

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Recent developments around data privacy and data collection have made marketers everywhere start wringing their hands and scratching their heads. 

Gartner says, “By 2023, 65% of the world’s population will have its personal information covered under modern privacy regulations, up from 10% today.”

Additionally, for the past few months, it seems like email marketers have spent 75% of their brain space worrying about how to navigate the Apple Mail Privacy Protection update that was released last month. (The other 25% of their brain space has been spent determining how to diagnose email campaign performance without an open rate.) Download our Email Marketer’s Survival Guide if you’re still in panic mode. 

Google has been talking for months about the depreciation of tracking cookies. While the update has been delayed until 2023, marketers should be using the time to evaluate how they’ll navigate a cookieless world. 

For these reasons and so many more, marketers must have a good grip on the various types of data and how they can be leveraged effectively and ethically.

 

1. What is Zero Party Data?


Zero party data is information that your prospects, subscribers, and customers have shared directly with you in a one-to-one transaction of data. It requires a direct relationship with the consumer.

 

Zero party data point examples:

  • Communication preferences 
  • Product preferences
  • Any customized account configurations 

 

How is zero-party data collected?

Zero-party data is collected through customer communication, i.e. email, web chat, and conversations with support and sales.

 

How can marketers leverage zero-party data?

Zero-party data provides marketers with that extra little bit of spice to really nail personalization in email communication and overall customer experience. For example, segmenting out your customers based on indicated interests from their subscriber preferences and delivering them more of the content they requested will improve campaign engagement rates, customer retention rates, and revenue per email rates.

 

2. What is First-Party Data? 


In some cases, first-party data can look a lot like zero-party data. It also requires a direct relationship with the consumer. For simplicity’s sake, this is the data you collect from your prospects or customers via platform or marketing tools. This data offers a clear picture of your audience’s interactions with you.

 

First-party data point examples:

  • Email addresses
  • Phone number
  • Company
  • Purchase history
  • Support history
  • Loyalty program information 

 

How is first-party data collected?

First-party data is collected through things like quizzes, surveys, form submissions, ebook downloads, and your business management system (point of sale).

 

How can marketers leverage first-party data?

First-party data, like zero-party data, is the information and the context that can help marketers connect with and retain prospects and customers through the personalization of correspondence and overall experience.

It’s important to note first-party data is only as accurate and reliable as the individual on the other side of the form. Threats like bots, mistyped email addresses, malicious moles, and more can enter your list without your knowledge. This can be addressed by using services from a third-party data provider. More on this below.

 

3. What is Second-Party Data


Second-party data involves an indirect consumer relationship. It’s the data collected through website activity, social media profiles, and customer feedback.

Second-party data point examples:

  • Action taken on your website
  • Action taken on your emails
  • Information shared on social media profiles
  • Reviews on sites like Yelp, G2, and Capterra

 

How is second-party data collected?

Tools like website heatmaps, Google Analytics, Google Search Console, and marketing automation software, such as Hubspot, Act-on, or Pardot, collect second-party data. Directory sites, such as Yelp, G2, and Capterra, collect customer reviews.

 

How can marketers leverage second-party data?

Second-party data is the data that is used for marketers to determine how successful campaigns are, which emails and landing pages are the most effective, which are least effective and how to scale up what’s working and rework what is not. 

With tools like Google Analytics, Google Search Console, and marketing automation, you can find out which search terms have brought users to your site, the path each user has taken on your site, what pages have been clicked, which emails have been clicked, how recently, and more. Additionally, tools like website heatmaps can tell you which areas of your product and landing pages are getting the most clicks so you can optimize call to action trigger placement and page layout. 

Candid reviews on sites like G2, Yelp, and Capterra can tell you what your customer experience is doing well and where it’s falling short. Internal teams can use the insight to take actionable steps to address any negative feedback, while at the same time putting systems in place to prevent the same issues from happening again.

 

4. What is Third-Party Data?


Third-party data is an indirect customer relationship and covers a broader scope than other data types. It’s collected by third-party data aggregators and purchased through a data marketplace.

Examples of third-party data points: 

  • Postal address
  • Demographics
  • Email address
  • Phone number
  • Interests

How is third-party data collected?

Third-party data is purchased in bulk by segments that are most relevant to marketers’ target audiences. When choosing a third-party data provider, marketers need to choose wisely. Choosing a data provider that sources and collects its data with consent is crucial for data accuracy, quality, and your brand reputation.

How can marketers leverage third-party data?

Third-party data can and should be used to enrich both zero and first-party data. Enriching your first-party data can offer more insight into customer demographics, cross-channel behavior, other interests, and more. 

For example, a service like data enhancement can offer you information on your prospect Alec. He’s a married homeowner, between the ages of 35 and 44, and he has the presence of children in his home. His yearly income is over 100k and he drives a BMW. 

Using this information to bolster his first-party and zero-party data will ensure you’re ready to meet him with quality content and offers on the devices and the channels he visits the most often.

Download our Complete Guide to Data Appends 

Third-party data can also be used to maintain the integrity and accuracy of your first-party data.  Email threats, such as spam traps, bots, and disposable domains are hiding in your contact lists right now. Using a reputable third-party data provider’s email hygiene service will help you identify those threats, assess the risk, and determine how you would like to handle them. A data enhancement service will assist you in filling in any data gaps, as well as verify that you have the most recent email address and postal address on file for individuals on your list.

Download our Complete Guide to Email Hygiene

The Takeaway

There is a wide variety of data available for marketers to take advantage of in light of Google’s eventual depreciation of third-party cookies. To gain a competitive advantage, marketers should focus their efforts on validating, maintaining, and enriching their first-party data with third-party data sources. Drawing on reputable third-party data providers to assist in enriching and cleaning first-party data with data enhancement and email hygiene services will be non-negotiable in 2022.  

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Melissa McGaughey, Director of Marketing at Webbula 

Melissa McGaughey is an SEO Strategist and Inbound Content Marketer with a decade of experience in B2B spaces. With a background in Agile Scrum methodology, developing processes and systems to streamline workflows, enhance productivity, and drive ROI is her jam. 

Webbula is the undisputed industry leader in Email Hygiene, Data Enhancement, and Audience Targeting services. Check out webbula.com to see what Webbula has to offer.

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