Wooden blocks with curved arrows. Some seem to be levitating off of the ground. The arrows point upward - Growth concept
Feature

Optimizing Apps and Services for First- and Zero-Party Data

5 minute read
Nathan Eddy avatar
Now more than ever, businesses must focus on collecting zero- and first-party data, to help organizations provide more personalized customer experiences.

Now more than ever, businesses must focus on collecting zero- and first-party data. Not only does that data help organizations provide more personalized customer experiences, but it also futureproofs organizations from major changes in the data privacy landscape.

Apple’s decision to let users opt out of data tracking, and Google’s removal of third-party cookies from Chrome sometime in the next year, means there's less data for businesses to use to track and target customers. “When third party data from Facebook or Google becomes less reliable, the solution is to collect your own first party data, so that you have a lot less reliance on ad platforms and on third parties,” explained Octane AI president and co-founder Ben Parr. “There's a big shift towards collecting and leveraging your own data so that you aren't vulnerable to these compounding data privacy changes.”

Parr said it’s critical to have different tools and experiences that ask your customers questions: Zero party data is simply data directly volunteered from customers. “The best kinds of tools to do this are quizzes and surveys. You ask customers questions, and you can use that data to personalize the marketing you send them,” said Parr.

He added that zero party data strategies should help customers accomplish something, and provide real value. “Make sure the questions you're asking are questions that will actually help them with their problem,” Parr said. “Asking them questions as a person would in real life in the store — things like sizes, styles, colors — this is genuinely helpful to the customer in helping them make a decision.”

Related Article: Why the Evolution of CX Is Impacting Your First-Party Data Strategy

The Value of UX Design When Gathering Zero-Party Data

Part of any successful zero party data collection strategy means testing out various UX designs, which could range from use of GIFs to the placement of the survey along the customer journey. “Really test the designs and see what the conversion rates are,” Parr said. “Test different questions, A/B test your quiz and your zero party data experiences.”

Saleforce's SVP Industry Advisor of Retail and Consumer Goods, Matt Marcotte pointed out data collection efforts must also help customers understand how and why that data is being collected and used. “There’s a transparency around how you’re going to use that information, which is critically important, because customers want to know what they get for handing over this information,” he said. “The data you ask for and the actions you take are multistep relationships all about building trust.”

Related Article: The Demise of the Cookie and the Rise of First-Party Data

A Zero-Party Collection Strategy Must Align With Your Customer Expectations

Marcotte said companies must decide what they can offer their customers and what they want outcomes to be after collecting that data, and match those priorities up with what they are asking their customers for. “Alignment of company offerings with customer information requests is really important,” he said. “We’ve seen that customers are very willing to give out information if it’s going to benefit them.”

Parr said brands can be accruing anywhere between 20% to 50% more revenue when they implement a true zero party data strategy. This includes collecting this data and then leveraging the answers to this data in their emails and in their text messages, and then their marketing campaigns, to make the experience more personalized.

Learning Opportunities

But for zero party data strategy to work, businesses need to have their marketing team working on integrating this data into their emails and text messages. “You're going to need to have maybe your design team making sure that the quiz feels good, but there's enough new technology out there that makes it relatively easy to start implementing,” he said. “This is less about like a huge amount of work, and more about executive buying and buying into the idea that if you're not collecting the data, your competitors likely are.”

Related Article: That's the Way the Cookie Crumbles

Gamification and Frictionless Experiences Are Key to Gathering Data

Gamification has become much more important as well, noted Marcotte, which means thinking about how to make data collection more fun for the customer and creating opportunities for instant gratification. “Make it as seamless, frictionless, and intuitive as possible,” he said. “Consumers are expecting this now more than ever. That instant gratification is not only more demanded, but also more supplied.”

He pointed out that as we emerge from the pandemic and customers start venturing back out into physical retail stores, the ability to connect their online activities and behaviors with physical behaviors means collecting data also must carry through. “Companies have to make sure they have the ability to gather data at all touch points, and that there are platforms to gather and synthesize those insights and push them across the organization,” he said. “That data can’t be silos, it has to be a connected ecosystem, now more than ever.”

Zero Party Data Collection Should Be a Priority in 2022

Parr said he firmly believes 2022 is the year brands embrace their zero and first party data marketing, in part because Google's removable third-party cookies is on the horizon.  He added that in a year or 18 months, as third-party cookies go away, the companies that have collected this data will be far ahead of those that did not.

“Every brand will have to adapt to that, no matter how big or how small,” Parr said.

Marcotte agreed, noting organizations must invest in systems, platforms and solutions that create a unified view of a customer. “Now is the time for companies to think about being transformational in their investments with data that help them take better actions,” he said. “That also means Internally, there has to be alignment at the executive level about what they key goals are for that organization — incentives need to be aligned with expectations.”