First-Party Data Stops The Guessing Game

The shopping journey of today’s consumers is fragmented and complex. Brands struggle to explain customers’ path to purchase using the information collected by the third parties.

First-Party Data Stops The Guessing Game

Today’s consumers are active across a vast range of platforms and devices, giving rise to a fragmented and complex shopper journey. Even more challenging for retailers is that each and every customer expects a personalised experience wherever they may interact.

According to GlobalWebIndex, digital consumers now own an average of 3.64 devices. These multi-screening, always-connected consumers make it even more complex than ever before to ensure retailers reach people in the right place, at the right time, and with the right message.

Take Tom the shopper as an example. In the morning he might browse a retail site on his tablet, and then revisit the same site on his smartphone while at work before passing near one of the retailer’s physical stores later on. Tom’s shopping habits, fragmented enough on their own, are specific to him. Every other consumer will travel along a different purchase journey. This is the challenge at hand for brands.

Shopping Habits New And Old

Recent research from Signal, surveying 2,000 U.K. consumers, paints a fresh picture of this increasingly complex landscape.

The findings confirm that millennials are driving the popularity of mobile shopping, but also show that more traditional methods of browsing and buying remain just as established as they have been for many years. For example, laptops and desktops are still the preferred way of shopping for 61% of overall respondents (and for 67% of 65 to 74-year-olds, and 52% of 18 to 24-year-olds).

So while mobile should rightly be a focus for marketers, it’s important to consider mobile an opportunity for engagement alongside other platforms, not instead of them.

The Rise Of First-Party Data

In this age of consumer empowerment, where shoppers call the shots about where, when, and how they browse and buy, retailers need to be able to understand and respond to customers everywhere and anywhere. That’s why there’s an increasing awareness about the value of first-party data as a critical marketing asset.

For years, marketers have turned to third-party data to enhance their targeting strategies, investing in data about consumers they assume to be interested in their products. While demographic data from third-party sources can enhance customer acquisition strategies or fill in blind spots about customer behaviour, it can’t explain a customer’s full relationship with a retailer or their path to purchase. And there are inherent issues like quality, accuracy, recency, and expense.

First-party data solves these challenges because it’s based on actual interactions with a brand across the vast array of consumer touch points, both historical and in real time, rather than the behaviour of lookalikes that occurred weeks or months ago. It’s the only data that offers the insights and control retailers need to recognise, relate, and respond to customers in more relevant and meaningful ways.

Leveraging Insights

Brands are now looking at how to use first-party and second-party (shared first-party) data beyond traditional direct marketing channels like mail or email.

Here are some ways they are leveraging offline and online customer insights to reach and engage actual shoppers wherever they are in their decision journey:

The channels consumers use aren’t changing from one to another. Instead, they’re growing as people are active across a myriad of social channels, internet browsers, email, and, of course, within traditional high-street stores. Pigeonholing consumers with general demographics is a mistake as there is no set behaviour that fits any one segment. Shopping options for today’s consumers are incredibly diverse and continue to grow, so mapping a purchase journey based on gender or age alone can lead to inaccuracies, poor return on spend, and missed sales opportunities. Marketing approaches that leverage first-party data help create experiences that are tailored to address shopper wants and needs no matter the channel.

To reign supreme in the omnichannel world, brands need to embrace a real-time, truly personal approach to seamlessly meet consumers’ individual preferences. Returning to the example of Tom, he might browse a retailer’s website on his home laptop before work to view some speakers he’s interested in purchasing. From there, he may be able to complete a purchase at lunchtime on his smartphone. To drive this conversion, retailers can prompt him with an email, Tweet, or whatever he prefers once he’s browsing again on his smartphone. That will provide a tailored reminder of the purchase in a highly personalised manner—in this case, with a special offer on the product, for example. Collecting and connecting first-party data in real time makes this personalisation possible. With such data, retailers can build holistic consumer profiles that are constantly updated and always available for marketing activation. This also enables brands to reduce any ad waste—subsequently boosting return on investment—as well as create loyalty in customers, which in today’s competitive landscape is increasingly difficult to generate.

The accuracy and richness of first-party data is changing digital marketing from a guessing game based on general demographics into a precisely enabled practice inspired by direct marketing predecessors. Leveraging first-party data to provide personalised, one-to-one experiences at the right moments and via the right channels is the best way to build relationships with customers and maximise any opportunities along the complex path to purchase.