.svg)
.svg){kind=icon}
First party data and customer centricity
Data generation is not an end in itself. Companies should therefore focus on the "why" when collecting data: What is the goal? This leads to the questions: How do I achieve this? And what questions do I need answers to? These questions in turn lead us to the "what": What data will provide me with answers to my questions? And this is where "first party data" comes into play. This is the data that we get from our customers themselves and that we need for customer centricity! But why customer centricity? Today's successful companies are so successful because they understand their customers. We need to know who our existing and future customers are and put them at the center of our strategy.
What is first party data?
First-party data is data that companies receive or collect from their customers themselves, e.g. in online stores, CRM systems or at the POS. For example, a company that sends out newsletters collects the email addresses and possibly the names and other characteristics of the users as part of the opt-in process. The companies have access to this data at all times and can use it for marketing activities, for example, within the scope of the data usage declaration agreed to by the users. High quality, direct control and independence from third parties are the major advantages of first-party data.
Difference between first party data and third party data
Third-party data is data that is collected and sold or shared by external providers. These providers collect data from various sources and offer it to companies so that they can gain a broader understanding of their target groups and make their marketing more targeted. Third party data can be less precise as it is not collected directly by the company itself and is often aggregated.
Consent and data protection
Data protection refers to the protection against the misuse of personal data and the protection of the right to informational self-determination. In Germany, for example, data protection is regulated by the General Data Protection Regulation (GDPR). "First-party data" therefore does not mean that no consent is required from customers to collect and use this data. A lot of first-party data is collected via cookies. Customers must consent to their collection and use - e.g. in an online store or on a website. They must also be informed about the purpose of data storage and the storage period.
Advantages of first party data
Learn more about Data Driven Marketing now
Better understanding of customers
Greater control
Data accuracy
Personalization options
Data ownership
Efficiency
Challenges with first party data
Once companies have obtained consent to collect and use the relevant data from their customers, they are often faced with the challenge of this data ending up in data silos. For customer-centric use, e.g. in marketing, this data from the various data sources must be logically linked and merged. To do this, companies need to shed light on their MarTech stack , among other things. Customer Data Platforms (CDP), for example, offer solutions. Sophisticated data management and the generation of required insights, e.g. through AI-supported applications, provide the basis for activating the available data. Among other things, this enables insights into customer preferences and the personalization of communication and offers in marketing.
Our conclusion
The generation of first-party data, data ownership and the specific consolidation of relevant data and data sources provide the opportunity to focus on customers and their needs and interests. A data strategy can help with the design of the required structures. A central view of customers and therefore a wide range of analysis, contact and automation options away from manual processes optimize the maintenance and deepening of customer relationships, cross-selling and up-selling opportunities and increase customer lifetime values as well as acquisition opportunities.
Learn more about customer centricity now
Find out more