Changes are causing confusion.

With the death of third-party cookies looming, resulting in confusion, frustration and fear, the way digital marketers go to market is dramatically changing. However, data-driven teams are not panicking because they are realizing the benefits of first-party data.

What is first-party data? CDP.com defines it as “data you collect directly from your customers and audiences through interactions with them. It includes demographics, purchase history, website activity, interactions, interests, mobile app data, and behaviors.” Because first-party data is collected and stored on the company’s own servers it is more dependable and accurate than second and third-party data that is collected off the client (browser) and stored by the second or third party.

While client (browser) based customer data tracking has been the industry standard for marketing and web analytics tracking, first-party data has always been the most valuable type of data a company has.  And, as we move closer to the post third-party cookie landscape, first-party data will become even more critical to building a successful and future proofed data lead strategy.

Why is first-party data becoming so important?

In addition to helping Enterprise brands create more purposeful and relevant marketing touches with their audiences, first-party data also can streamline your marketing, analytics, and inter-team operations by:

• Improving customer experience with personalization by maintaining consistency, cohesion, and trust with consumers on all channels.  Thus, leading to stronger brand loyalty and, ultimately, increased revenue.
• Improving customer data accuracy because the Enterprise collects, stores, and owns the customer data and how it was obtained. Creating less chance of data loss, duplication, or distortion resulting from issues like browser settings or ad-blockers.  
• Creating a single customer view will eliminate multiple profiles for the same user- effectively merging them into a single view of each customer.  This single “360 Customer View” makes it easier to send the right message at the right time, limiting wasteful marketing spend.
• Reducing cost of gathering disparate customer data by unifying across marketing, sales, product, mobile apps, and CRM platforms provides a much more accessible and detailed view- creating a single source of truth.

The Evolution from Third-Party to First-Party Data

The evolution from reliance on third-party data to first-party data marks a shift in how you gather, manage, and use customer information. This shift has been driven by privacy regulations, technological advances, and a growing demand from consumers for trust and transparency.

Regulations like GDPR and CCPA have played a significant role in putting data privacy in the spotlight. First-party data is a great solution for organizations trying to ethically collect data that complies with these regulations. Consent is the name of the game, and platforms like MetaRouter help to set up a data governance model that enforces compliance at the point of collection. This enhances transparency and allows you to confidently distribute your data to various endpoints without worrying about running into compliance issues.

Browser changes have also accelerated the shift to first-party data. Safari and Firefox have already phased out support for third-party cookies, and Google has signaled changes to its Chrome browser with  the introduction of Privacy Sandbox. Even without technological shifts from major browsers, up to 42% of internet users worldwide use ad-blocking software. Collecting third-party data continues to get more difficult.

One could also make the argument that first-party data is inherently more valuable and reliable than third-party data. First-party data is the result of direct interactions with your customers, with common data points such as sales interactions, website engagement, shopping cart behavior, and marketing campaign engagement. The ability to interpret these data signals is critical in understanding your customer’s journey. Not only that, modern data governance strategies place an increasing emphasis on data privacy and compliance, where having a chain of custody on consent lowers the risk of penalties and ensures the fidelity of the data.

What are the Benefits of First-Party Data?

First-party data offers a number of benefits for digital marketers looking to enhance their campaigns. The collection of data directly from your customers allow for more precise insights and unlocks capabilities like marketing personalization. You simply can't match this level of insight with third-party data – data points like customer interactions, preference, and purchase history are invaluable. 

Let's take a closer look at some of the benefits of first-party data.

Compliance is key.

Ensuring compliance is critical for first-party data driven teams with ever changing privacy regulations because first-party data is owned by the Enterprise and collected in compliance with regulations.  Organizations can use first-party data with minimal risk because they know the source of the data and the methods in which it was gathered.  First-party data ensures that customer data collection processes are in compliance with regulation without depending on second or third party partners for enforcement who, when using browser based tracking (where customer data is often stored on the browser) they can be subjecting that second or third party data to potential data breach or hacking.  Additionally, First-party data makes it easier for companies to comply with data regulations like GDPR and CCPA because it can be controlled and deleted independent of the third-party partners.

Fostering trust with customer base by protecting their visitor’s privacy. By not sharing customer data with third-party partners, they mitigate the risk of exposing customer data that may be used for targeted advertising or other purposes.  First-party data is only accessible to the company that owns it which ensures that the customer data is not shared with third-parties without their consent.

Establishing the post cookie landscape business value today starts with customer connections.  No question that digital ad targeting is in the midst of change with more on the horizon. Which means reaching consumers efficiently and effectively will likely become more challenging.  With first-party data strategy, enterprises preparing for tomorrow’s post-cookie landscape are the ones that have deeply personal, trusted and direct relationships with their customers across a wide variety of channels. First-party and real-time data from across the web and apps, including first-party data with customer consent, context, behavior, and identifiers- it will take all of these to realize the business value in a post-cookie world.

With the increasingly critical role of First-Party data strategy with the pending loss of third-party cookies, Enterprises should consider getting the right infrastructure in place in order to make the most of their first-party data assets.

The ideal infrastructure, designed to support and enhance the value of a first-party data strategy, is referred to as server-side tracking. With server-side tracking, Enterprises benefit from enhanced accuracy, complete control of event payloads and the partners with which they are sent, and at the point of ingestion compliance enforcement- which combined, create a data layer built on and enhancing the first-party strategy.

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