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Your Zero-Party Data Questions Answered: Go From Zero to Hero With This Guide

Other than a good cup of joe and an inbox filled with sale notifications, the top wish for any marketer is to have data. Not just any data, mind you. Data that is filled with customers’ preferences likes, interests, demographics, details, contact information, and what exactly tips them into pushing that “buy” button.

But as privacy laws tighten and users become more hesitant about sharing anything, it is becoming increasingly difficult to tailor users’ experiences and provide personalized ones, even though that’s what the consumer wants.

Enter zero-party data.

Zero-Party data is transparent and gives clear consent to the type of information you can gather from an individual, and they are more aware of what type of information they give.

So, how can it help with your marketing? We’ll look at all the top questions about zero-party data and tell you how you can use it for your business.

If you are looking for other strategies to apply to your business, you should talk to one of our strategists by calling 888-601-5359. If you don’t have time to call, use our online form!

Right — Let’s get this [zero] party started!

What is zero-party data?

Zero-party data refers to information that customers intentionally and proactively share with a company.

The data is given by the consumer with the knowledge that they will get a better, more personalized experience.  The three key elements of zero-party data are:

  1. Customer intent: The customer hands everything over. This includes all types of information, from their preferences to their intentions. It can be given through surveys, preference centers, or even a quiz.
  2. Enhanced personalization: By getting this information, companies can leverage it to offer personalized experiences and recommendations. Since the customer shared the information directly, the information is usually very accurate and reliable.
  3. Privacy and trust: The customer was aware of the information they gave, and why they were sharing it. This means it is 100% transparent interaction between the customer and the business.

I like to tell people interesting tidbits at parties. Where does the name zero-party come from?

Interestingly, the term comes from the number of steps between the consumer and the data source – which is zero! If you look at other types of data, they are usually called first-party and third-party. But this one has zero party as there is no middleman.

The term was originally coined by Forrester Research who introduced it to categorize better data that consumers shared.

What about the web cookie (third-party data)?

Unfortunately, the cookie is crumbling. Well, it would crumble if it were an actual cookie. You see, the web cookie does collect data for businesses passively. When users visit a website, they agree to have a cookie on their computer. Once they agree, it is usually forgotten about.

But that little nibble of data quietly collects all types of information about the user, and people are not so happy about it anymore. There are many privacy concerns about the management of cookies.

Which is why, back in 2022, there was a huge outrage, and the era of “cookie death” started, which sounds like the most delicious apocalypse I can imagine. This, of course, isn’t nearly as dramatic as it sounds. All it meant was that cookies were going to be slowly phased out, and browsers, such as Google, Mozilla, and Safari, were going to stop supporting them.

That means businesses needed to turn to other forms of data to market their products or services, like zero-party data.

How does zero-party data compare to other data types?

Zero-party data is given by the consumer to the company. Let’s compare zero-party data vs first-party data, second-party data, and third-party data to see how they differ:

  • First-party data: This is data collected directly from customers by a retailer’s website. First-party data will include channels of communication with a customer, such as websites, social media, email, and mobile apps. This method takes a lot of effort to do, and you are limited by your own resources and methods of collection.
  • Second-party data: Basically, another company’s 1st part data that is acquired through a marketplace or partnership. You’ll get this information from a trusted partner, or source, and it will be packaged and sold to you.
  • Third-party data: Third-party is data collected by external parties, usually aggregated and sold in data exchanges. It is collected by multiple different sources and is the largest amount of data you can get. But with more volume, comes more risk of data quality and accuracy issues.

Why am I telling you, specifically, about zero-party data?

You stumbled across this page probably because you are involved in business or marketing in some capacity. I wouldn’t expect a person who is in the professional farrier to be here. They would probably be somewhere changing a horse’s shoe.

No, you are here because zero-party data is interesting, it’s lucrative, and it is also the future. But why?

  • You can trust it: The information you are getting is straight from the horse’s mouth, so to speak (making the farrier feel welcome, just in case he did drop in). The clients who are giving you this information are doing it because they want the benefits of it.
  • It is the person, not a whim: With other types of data, much information is guessed. For example, you might think Susan is interested in horses because she’s googled “What does a farrier do?” But what the data doesn’t show you is that Susan is only interested because I keep talking about it, and it’s an uncommon phrase. If you had just asked Susan, which zero-party data does, she would say she doesn’t care for horses at all but actually prefers guinea pig companionship.
  • It’s more accurate: The data you receive hasn’t passed through third-party hands, or been reproduced a million times. It is fresh, new information and, therefore, more likely to be accurate and current.

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I’ve heard zero-party is good for digital privacy. Why?

Most of the other data parties have very little involvement from the consumer. They clicked on a cookie acceptance one time or forgot to untick a marketing box, and all of a sudden, every click and mouse movement they make is being tracked for years afterward without them remembering or even knowing.

You can imagine that this has resulted in some concerns.

The general public wants to know how much information is being gathered and where that information is going. Governments and companies across the globe are addressing the concern by tightening up privacy regulations and changing policies.

What! Like, who’s changed?

Apple is one, calling out its competitors to imply that, unlike them, it doesn’t track its customers. Google, Mozilla, and other browsers are also changing their policies regarding cookies and data collection.

Companies have tried to get consumers to consent to their passive marketing data collection, but it isn’t going well for them. According to statistics, only 21% of consumers have consented to companies capturing their information.

But why the change?

Customers want more control over their data privacy.  Over in Europe, regulations from the General Data Protection (GDPR) have made a lot of the traditional means of getting data, impossible.

The U.S. isn’t far behind with California passing new privacy laws, along with Virginia and various other states. It seems that, everywhere, policies and regulations are coming in to tighten up the ship and put the consumer’s information back into the hands of the consumer.

Ok, so zero-party is the future! But how do I get it?

Ask your consumer! Marketing teams all over the world are coming up with innovative ideas to collect zero-party data. While the whole process is transparent, marketers also try to make the journey feel natural for customers.

Ok, but seriously, how do I get zero-party data?

A few great ways to break that ice with your customers and get the ball rolling in zero-party data collection are:

  • Interactive content: Think quizzes or fun polls. These can be done online through an email marketing campaign or through social media.
  • Contests and giveaways: A way to encourage customers to engage with you is to give away something for free. Depending on what your offerings are, this could be a free product package or maybe free services for a period of time.
  • Gamification: You can ask customers for information while also participating in a gamified loyalty program or an online community. They can win badges, or be on a leaderboard, all while interacting with your product/service.
  • Social media engagement: Social media is an open-ended source of information about your customers. You can ask them for feedback, or ask their preferences with just a single post.
  • Customer feedback: A more traditional means of gathering information, but still effective in today’s world.

Great! Now that I have zero-party data, what do I do with it?

Once your data is in, cleaned, and ready to go, you can start creating marketing campaigns with it.  You can use zero-party data to:

  • Create personalized marketing campaigns
  • Enhance the customer experience
  • Tailor product recommendations
  • Improve segmentation and targeting
  • Build customer profiles

Once you start using it on the zero-party data examples above, it is going to transform your customers’ experience. Up to now, their journey was like going on trip on a train — There are a hundred other people, and you are all going in the same direction. People might be getting off at different points, but regardless, you have to stop at all the points, even if you aren’t getting off.

Adding zero-party data is transforming that train ride into your own personal chauffeured ride.

Once you have all this data, what do you do with it?

Collect it all in Nutshell of course! Nutshell is WebFX’s customer relationship management system that helps you keep track of every detail in the customer’s journey. You can also integrate it with other third-party software for email campaigns, ecommerce payments, and even communication software.

Contact us to discover how a CRM can change your sales, marketing, and digital team. With automation of tasks, schedulers, and getting teams collaborated, it will evolve your business to that next level.

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