How to nail the first-party data strategy, according to a Director of Product Management at Google (+ new data)

First-party data is information provided to you by your audience – including customers, visitors, subscribers or followers – or collected with their consent. Think about things like signing up for loyalty programs, signing up for newsletters, or filling out forms.

“First-party data is the data that your customers knowingly share with your company,” Combette explained.

When I hear from marketers who haven’t tried a first-party approach, it’s usually because they don’t really know what it is. And so they’re worried that they won’t be able to use it for the kinds of strategies that they’re used to.

Close your eyes and imagine creating a powerful campaign with all of the following elements while respecting your customers’ consent and privacy:

• Demographics
• Firmography
• Website behavior
• App behavior
• Social media engagement
• Purchase history
• Feedback and survey insights
• Interactions with customer service
• Loyalty and rewards program data
• Email engagement
• Etc.

Chances are, you already have some good ideas in mind (you rockstar, you), and it wouldn’t take much to get started.

With this data, you could build a similar audience, send a re-engagement email, or create all sorts of clever segmentation or personalization. Since everything is consensual, it respects the privacy of your audience. And since it’s from the source, you know it’s accurate.

And that’s not even close to a complete list.

(Side note: Sometimes a distinction is made where the data you collect is considered first-party data, while data you receive from customers is referred to as “zero-party data.” To be honest, I don’t think it makes much sense to separate the two. You should use both and will still combine them.)

“You have a wealth of customer insights aligned with your business outcomes,” Combette said. “And this combination together is one of the most powerful constructs.”

Let’s take a look at how powerful it is.

4 Ways First-Party Data Helps Marketers

When I called the transition to first-party data a challenge, Combette took a moment to gently correct me.

“I wouldn’t necessarily call it a challenge, but rather a major change in the industry,” he told me, adding with a grin: “That presents a great opportunity and a competitive advantage if you boil it down.”

And in truth, this shift is more about focus than application. First-party data has always been around, and many marketing teams are already using it to drive strong growth.

What is changing is that more and more companies are joining in.

“Some marketers have been very successful in developing marketing strategies based on third-party identifiers and first-party data Is a change for them,” he continues. “But it’s important because you can gain a lot more insight from it.”

And chances are, you already have the ingredients. All you need to gain insights is the right tools and a plan.

“It’s the data you’re already using to achieve the business outcomes you want.”

Whether you’re changing your strategy or just starting out, here are some data-backed reasons to consider it:

1. First-party data is more accurate and relevant.

According to a study by HubSpot, marketers who use first-party data are 93% more likely to say their team will exceed their goals in 2024 than those who don’t use it.

And 77% of marketers who use first-party data say it results in more personalized content and performs better than external data.

Combette lists a few use cases that really illustrate the value:

“Do you want to promote new customer acquisition? You can only know this information through first-hand knowledge. Would you like to optimize towards lifetime value? It requires thorough analysis of your first-party data. This is not possible with third-party identifiers.”

2. First-party data fills the gaps most marketers have.

It turns out that most marketers are missing important information about their target audience – only 42% know their basic demographic information and even fewer know their shopping habits, purchase history and the channels on which they consume content/media.

With such first-party data, you can gain high-quality insights and provide your customers with a highly personalized experience.

And because it’s collected directly from your customers, first-party data is extremely precise and unique to your business while maintaining privacy.

However, in order for customers to share their personal information with you, they must first trust you.

3. First-party data increases consumer trust.

It’s no secret that people are tired of seeing ads on every platform for something they once casually searched for.

Our consumer trends survey shows that nearly half (45%) of consumers distrust companies with their website behavior and cookie data.

By using first-party data, consumers can feel more secure about sharing their personal information because it is collected with their knowledge and consent – ​​and will only be used by those with whom they have shared it.

By leveraging first-party sources, marketers can obtain higher quality data while respecting consumer privacy, benefiting both parties.

4. Marketing budgets will increase to reflect changes in data protection.

Both government regulators and consumers are demanding privacy changes, and marketers are being tossed back and forth by the waves.

Fortunately, executives are paying attention and giving marketers the budget they need to explore alternative measurement and advertising solutions.

Nearly half (48%) of marketers say their budget has changed this year to compensate for privacy, with 71% reporting an increase in their marketing budget.

But in the words of wise old sage Uncle Ben: With a big budget comes great responsibility. And sometimes a few challenges too.

The challenges of using first-party data

“Creating and deploying your data across different environments hasn’t always been easy or seamless,” admits Combette.

Often marketers have to collect data with one set of tools, analyze it with another set, and then actually use those insights in a third set of tools.

So it’s perhaps no surprise that our research shows:

• 60% of marketers say collecting and tracking visitor data is becoming increasingly difficult.
• Nearly half (48%) of marketers cite increasing privacy changes/regulations as the biggest challenge to understanding their audience.
• On the other hand, only Half (56%) of marketers say the data they have about their audience is high quality.
• Only 16% have all the data they need to reach their target audience.
• Meanwhile, 47% say consumers trust their personal information less.

So while marketers are looking for high-quality data, their audiences are less likely to share that data. And even when marketers find it, it lives in ten places and they’re not sure what to do with it.

Luckily, we have a roadmap – created by Christophe Combette and our own data – on how to make collecting and using first-party data fast, powerful and easy. (Lemon juice is optional but recommended.)

7 steps to building a privacy-focused first-party data strategy

1. First ask what data you actually need.

Don’t scroll past this. This is not filler. This is the most important step.

If you’re familiar with using third-party identifiers to guide your marketing, you know that you don’t just collect them in the hope that you’ll somehow know what to do later. When you started, you had a use case in mind.

It may have been targeted social advertising. Maybe it was cross-platform tracking. However, there was a purpose behind the data you collected.

Why should first-party data be any different just because it is freely available?

In fact, if you collect all sorts of first-party data without regard to the use case, you’re more likely to overstep privacy concerns. And you end up with data vomit that doesn’t help anyone.

Instead, start with your business results and work backwards to the data you actually need.

2. Check your data sources.

Now that you know what data you need, it’s time to think about where it comes from.

“We are all consumers ourselves. We use the app, the web, we call, we text. “Sometimes I chat online,” says Combette. “We have this abundance of online touchpoints.”

And each touchpoint represents something unique about your prospect or customer.

“So the key is to have a tech stack that provides a 360-degree view of the customer.”

This means collecting data from multiple high-quality sources. Here are the touchpoints that marketers in our survey agree are the highest quality sources of first-party data:

• Customers who register/create accounts with your company (sign up for content, discounts, newsletters, etc.) (36%)
• Information collected during the purchasing process (28%)
• Customer interactions with customer support channels (20%)
• Social media interactions (likes, shares, etc.) (16%)

You will find that the highest quality sources tend to have the highest buy-in. This means that you have to do a lot of convincing. Which brings me to…

3. Consider the value you offer in return for the data.

“For each of us, time is one of the rarest commodities of all. We’re constantly trying to get things done, and that brings with it a lot of touchpoints,” says Combette.

Most marketers will look at “touchpoints” as the theme of this sentence and start thinking about the value they can get from it. But value is a two-way street. If your content isn’t worth your audience’s limited time, then it’s not worth their data, and those touchpoints will quickly dry up.

At HubSpot, we have great success with templates, calculators, and free tools. Other companies may opt for white papers or webinars. For a B2C company, it can look like vouchers and freebies.

The exact offer depends on what your specific audience values, but it’s definitely important must Provide value.

Here’s what marketers in our survey reported as the most effective ways to motivate customers to share data:

• Offering discounts/promotions/loyalty programs (40%)
• Creating social media content (e.g. posts, videos, giveaways) (28%)
• Creating content on your website (e.g. blog posts) (18%)
• Creating an email newsletter (12%)

4. Know where your data goes.

Now you know what data you need, you’ve identified high-quality sources, and you’ve convinced your customers to share it. Great! Where are you putting it now?

In a CRM? A CDP? GGT? WQE? If you don’t know which of these acronyms I just made up, then it’s time to learn about the different types of data platform software.

The type of software you need depends heavily on your business model, but every business needs a single source of truth.

Our research shows that with a single source of truth, marketers are 94% more likely to say their team is exceeding their goals.

Yet only 60% of marketers have a single source of truth for all marketing data.

5. Plan your customer journey.

Collecting the data is point A, and your business goal is point B. Now the trick is: how do you get your customers from point A to point B?

You just place an ad and then they buy, right? If you build it, will they come? Unfortunately, it’s rarely that simple.

“All of our customer journeys are becoming increasingly complicated and fragmented. We also see it on our site, so it’s not the buying channel,” shares Combette. “Consumers use five or more online sources before purchasing. This could be a search, a video or accessing Google Maps.”

And each of these steps is a decision point where your customers can choose you… or someone else.

Only 16% of marketers have complete visibility into their customer journey, but those who do are 200% more likely to say their team is exceeding their goals.

So if you’re looking for that competitive advantage Combette mentioned, you’ve just found it. Take the time to learn more about customer journey analytics.

6. Link your data directly to this customer journey.

One of the biggest challenges with first-party data is carefully measuring those five or more touchpoints that Combette mentioned.

For example, if you manually recreate an audience you created in your CRM in Google Ads, you’ll waste a lot of time with a lot of work. (Time that would be more productive, like watching the paint dry.) And you will do this every time the audience is in the loop.

And that’s just one channel.

Instead, look for software solutions that automate integration with your marketing tools.

Pro tip: Marketing Hub+ users can do this Automatically integrate your intelligent CRM data directly into Google Ads Data Manager.

This means you can instantly find your audience in search, shopping, YouTube, display, and more. And it works the other way too, so you can sync new leads right back into your CRM.

And because syncing takes user preferences into account, your advertising is automatically both privacy-compliant and consent-driven.

I took a moment to chat with Combette about the integration, because how often do you get the opportunity to chat with a Google manager?

“Our goal was to make the integration easy,” he says. “It’s easy to create first-party data in HubSpot and use it in Google Ads. Advertisers don’t have to worry about moving data around and can focus on the business outcomes and strategies they want to deploy.”

And if I can humbly brag for a moment, marketers who use HubSpot and Google Ads together see an average increase of 31% more leads.

“And these leads are also cheaper. “We see a 12% decrease in cost per lead within the first 90 days of linking these two products,” he adds.

7. Use this data more than once.

To make your data truly useful to you, you should apply it to as many of your marketing efforts as possible.

The downside to this in the past was that it required a lot of redo work. (Hellooooo, I’m building the same audiences in Facebook, LinkedIn, Display, etc. etc.)

No matter which tools you use to collect or store your data, the new Google Ads Data Manager scores particularly well when it comes to implementation.

“We want to ensure that advertisers can bring data in once and support a range of downstream use cases,” says Combette.

A point-and-click interface lets you take advantage of a range of Google Ads tools and features, such as: B. advanced conversions and customer matching – more are planned.

And if you’re not familiar with these tools, Data Manager actually walks you through setting up workflows.

“With just five or six clicks, you can start bringing that data into use cases that we’ve walked you through,” he says. “We built Data Manager for busy marketers who want to rely on first-party data but aren’t necessarily data experts. They don’t have a developer writing custom code.”

Then Combette smiled excitedly as he gave me a preview of something Google was about to launch. A brand new feature that ensures data protection is at the heart of the marketing process:

“We are building a confidential reconciliation that includes special software and hardware called “ Confidential ComputingThis allows advertisers to control their data before it even enters a Google environment. This is the first use of the technology in our ads products and we plan to apply this privacy-enhancing technology to additional products over time.”

This means more data in more use cases without the fear of exceeding privacy boundaries.

What’s next for first-party data?

Adapting to first-party data can be challenging as regulations and public opinion on privacy are actively evolving.

But if you follow these steps, you’ll be one step ahead in developing a first-party data strategy that exceeds your goals and delights your customers.

The most important thing marketers can do is to start using first-party data now and explore new marketing solutions so they can adapt their data strategy when the time comes.