Marketers are often accused of using consumer data purchased from data management platforms and data marketplaces. Third-party data is sold to marketers without explicit consent or consumer awareness, thus fueling the perception that marketers do not care about consumer privacy. For a long time, third-party data was the only option for understanding and engaging customers.
Marketers don’t set out to build bridges between customers. That’s just the price you’ve had to pay to attract customers and create a personalized experience. Without relevant information about your audience, this is no easy task. So the marketer needed third-party her data to narrow down the target.
However, third-party data is often plagued with errors and gaps, leaving marketers with huge and poorly defined audiences. Low efficiency; more wasted advertising budget and lower ROI.
Long-term shift to first-party data
now imminent Google Bans Third-Party Cookies Marketers are turning to first-party data, the data they collect directly. And what a welcome change that would be.
It’s clear that this is the development that marketers have been asking for for a long time. Google’s cookie ban won’t take effect until his 2024, but 43% of business leaders have already adopted first-party data Because it gives customers better privacy, according to a recent Twilio report.
Admittedly, moving to first-party data is not easy. 81% of businesses rely on third-party cookiesreport foundMost businesses lack tools such as Customer Data Platforms (CDPs) that can collect consented customer data from multiple sources and combine it into a single customer identity, and are unable to manage and validate first-party customer data. to build deeply personalized campaigns. More recently, CDP, an add-on for marketing teams, becoming mainstream.
By implementing a first-party data strategy, marketers can gain consumer trust and generate more revenue and long-term value for their business. These four techniques can help marketers get started.
- Opt in to data-driven marketing
Other departments may have once managed customer data, but now it’s entirely within marketing. Marketing is no longer just running campaigns and reports. Today, a comprehensive marketing data strategy also requires a deep, data-driven understanding of customer behavior after the first purchase.
This is a big mindset shift, even for marketers who already recognize the power of customer data. Making this data effective is the next step and it will take time to deliver results. The sooner marketers start, the better.
- Use the Future-Proof Marketing Equation
To be profitable, customer lifetime value must be at least two to three times the customer acquisition cost.
First-party data enables marketers to target the most qualified prospects faster, target spend more efficiently, and reduce customer acquisition costs. At the same time, marketers can identify customers worth investing in to increase their lifetime value and ensure they engage with them in an appropriate and personalized way.
when Domino Mexico Implementing a CDP to manage our first party data has reduced our cost per acquisition by 65% and improved our return on ad spend by an incredible 700%.
- Market in real time because consumers operate in real time
There’s nothing more annoying than seeing a redirect ad for the same product on Instagram an hour after your purchase. Over time, this annoyance can erode brand loyalty and trust.
Marketers need real-time data to avoid these inefficient oversights. As soon as a customer makes a purchase, marketing no longer has to convince them to buy. The challenge now is to develop them as long-term customers. This change unlocks long-term value, but it must be done in real time. CDP can make it easy.
- Hire a privacy or governance expert for your marketing team
Consumer privacy is an ongoing challenge. Many marketers want to protect consumer privacy, but lack the expertise to comply with privacy and governance regulations. Hiring an expert who can help establish proper data compliance guardrails and good data etiquette is a good starting point.
US brands doing business in Europe already have to comply with the European Union’s General Data Protection Regulation (GDPR), but for compliance as well as understanding consumer expectations, companies in other countries It would be prudent to research how your company treats consumer privacy. European laws (and consumers) are far ahead of the privacy path and show where US consumers may be moving.
Leveraging first-party customer data, deriving long-term value from customers, marketing in real-time, and understanding privacy regulations and consumer expectations globally are so many things that today’s marketers These are just a few of the many challenges we face. These changes are not easy and the results will not come overnight. But adopting these strategies will ultimately lead marketers to truly put privacy and consumers first.
how marketers The Future Hero of First-Party Data.
Kathryn Murphy is General Manager Twilio Engage.