The impending death of third-party cookies means an inevitable shift towards first-party data for brands and marketers. Sam Martin-Ross, UK managing director of digital marketing agency, Eskimoz, discusses why this is not necessarily bad news.

A survey from Google reported that a staggering 92% of leading marketers believe using first-party data to gain an understanding of what their audiences want is a critical factor to growth. In fact, using this type of direct data to inform both individual campaigns and wider marketing strategies allows you to tailor your communications in a much more effective and personalised way, boosting engagement and brand loyalty in the process.

What is first-party data?

First-party data simply refers to the data you collect directly from your audience. This could be through customer service interactions or actions a user has taken on your company channels such as your website, apps, or social media. This kind of data encompasses everything from the age and location of a specific user, to their buying patterns, pages visited, or even posts and content they’ve interacted with.

Because of the direct nature of first-party data, it’s considered relatively high-value, providing genuine insight into consumers with minimal privacy issues. As third-party cookies are phased out to respect the privacy of users, brands will naturally start to rely more heavily on the data they can collect directly from their audiences.

The benefits of first-party data

Along with respecting the privacy of your customers, first-party data brings a host of benefits from a marketing perspective. First and foremost, it helps to build a clearer picture of who your audience are, what they want and how they interact with your brand, enabling you to create more effective marketing campaigns and reach your target consumers in a more relevant and direct way. This is a growing trend, with one report from Statista finding that in 2021, 31% of brands were using exclusively first-party data to personalise their customer experiences, with this figure rising to 37% in 2022 – and this trend is only set to continue.

More effective campaigns don’t just contribute to strengthening the relationship between brand and consumer and boosting reputation, but also bring more concrete benefits. “Owning” your audience through access to first-party data means you can more easily target promising leads – i.e., those who have willingly shared information with you, or interacted with your brand – further increasing the efficacy of your campaigns. Similarly, leveraging first-party data enables you to grow your brand more cost-effectively when it comes to paid ads, helping you to laser in on the most effective leads and spend advertising and marketing budgets more effectively.

Providing value

Though consumers are concerned about data privacy, a survey from 2022 found that nearly 90% of people are still willing to share personal information with brands for the right incentive, such as an improved or personalised experience.

Creating a successful first-party data collection strategy involves determining what your audience will consider a fair value exchange in return for their personal information.

This might be as simple as someone who is willing to share their personal email address simply to stay up to date with brand product launches or newsletters, but generally consumers want a more compelling reason to share private information. One survey found the most valuable incentives to be those with distinct value, such as a discount code or free sample, with 22% and 21% of respondents citing these as compelling incentives respectively.

To maximise a return on investment, brands must carefully consider which incentives make sense for a given audience, then optimise them towards distinct target segments, rather than taking a one-size-fits-all approach.

Being careful what you ask for

An effective approach to collecting first-party data requires brands to carefully balance the types of data they are asking their audience for, with consumer expectations around data privacy.

Different audiences have different expectations and standards when it comes to data they’re willing to share and what they’d rather remain private, and it’s important to consider these factors before asking. For example, many businesses request information such as gender and date of birth, when in reality, this sort of information does little to

enrich marketing campaigns and communications. In these situations, purchasing activity or pages visited on your website are likely to yield far more useful data points for future marketing communications. Before putting off potential customers with excessive requests for personal information, it’s important to really consider whether these data points will add value to your marketing strategy, customer experience or give some other tangible benefit.

Further to this, consumers don’t only want to know what data you are collecting, but how and why you are collecting it. Taking a clear and transparent approach to collecting first-party data will help establish trust, making people more likely to consent to data sharing if they fully understand why and how companies will use their information.

Final thoughts

With Google’s phase out of third-party cookies beginning in 2024, brands must proactively establish and prioritise their means of collecting and using first-party data. While the shift from traditional methods of data-driven targeting will undoubtedly present new challenges for businesses and marketers alike, it also opens up the possibility of creating more effective, personalised campaigns that help make the most of stretched marketing budgets.