While first-party data requires visitors and consent, the difficulty with zero-party data is how you get your hands on it.
Third-party cookies are on their way out. Google’s Privacy Sandbox initiative means they’ll be consigned to the history books by late 2023. And while you probably already know this, what does this mean for other types of data?
by Georgia Deery
Read on as we take a closer look at the fate of third-party cookies and how first-party, zero-party and Earned Data will take the main stage.
What’s happening to third-party cookies?
Cookies have come a long way since their invention in 1994, when Netscape’s Lou Montulli created a tool to help websites remember users. The development was intended for specific websites rather than cross-site tracking, which is where third-party cookies come into play.
Put simply, they’re text files which are stored on a user’s computer by a website which isn’t the one they’re visiting – hence the “third party” bit. The text files are then used as tracking codes by any website which loads that third party’s code. They can be used to see which sites you’ve visited, giving them a better idea of the products you’re interested in, for example.
Understandably, third-party cookies became hugely popular for advertisers, who could provide more targeted, relevant ads. That was, until the General Data Protection Regulation (GDPR) in 2016. GDPR gave users more power over cookies, outlining that websites have to gain a user’s consent before storing them.
While many websites have proceeded to ask for consent (not always in the most agreeable ways), browsers have begun phasing out third-party cookies. Google Chrome, which accounts for almost two thirds of the browser market, plans to have them completely out of the picture by 2023.
How that impacts other types of data
Over the years, third-party cookies have become a big part of some businesses’ strategies to target their audience and engage customers. As they’re phased out and ultimately eliminated, they’ll leave a big third-party-cookie-shaped void. Thankfully, there are alternatives – namely, first-party, zero-party, and Earned Data.
First-party data is data collected by a business, relating to users’ activity and behavior on their own site. It’s owned by that business and not shared across sites, which is what separates it from third-party cookies.
Zero-party data refers to the information that customers willingly provide to businesses. That could be basic details like their name and address to set up an account, or more personal information like their age, preferences and shopping habits, submitted in a survey.
These types of data are far from novel. The concepts behind both terms predate third-party cookies. In many cases, businesses will already be using them to some degree too. However, with third-party cookies delivering such a wealth of information in an instant, many businesses have – understandably – become reliant on them. That usually means neglecting other avenues of audience targeting and engagement as a result.
Now, businesses will need to focus more on the data they can collect and access, and how it can help them move forward…
Focusing on first-party data
The good news for any business based online is that you already have the opportunity to access a wealth of first-party data from first-party cookies. While these cookies also require consent from users, there are no plans to phase them out. Once a brand has consent, they can provide invaluable insights into how customers move around your site – from where they go and how long they stay to what they add to their carts.
In this case, the challenge is getting them on your site. The more potential customers you attract, the greater depth of knowledge you can build up. Search engine optimization (SEO) is one way of doing so, identifying the keywords and phrases that potential customers search for then optimizing your site to align with them.
Pay-per-click (PPC) ads are a way to fast-track this strategy, though it comes at a cost. Rather than gaining visitors organically, you can write ads to target specific searches and pay for each click through. Another popular route is through social media, where you can grow a following of potential customers before guiding them to your site.
What about zero-party data?
While first-party data requires visitors and consent, the difficulty with zero-party data is how you get your hands on it. People don’t tend to freely hand over information about their spending habits. Not least because modern consumers understand the value their data holds.
As a result, survey rewards and incentives have become a go-to for businesses that want to gain specific insights. Discount codes, competition entries, freebies and gifts, or even cash incentives can be offered to consumers in return for completing a survey.
The responses deliver zero-party data which can be useful in guiding your short-term direction, albeit for a cost. That could include which products people want at a given time, or which social media platform is on-trend, for instance. What they won’t provide, however, is a meaningful, ongoing interaction. That’s where Earned Data differs…
Introducing Earned Data
Even with the best rewards for surveys, it’s hard to get the same customers engaging time and again with your brand. That limits zero-party data to one-off insights. On the other hand, Earned Data comes from an ongoing value two-way value exchange, where users come back because they’re engaged – not explicitly incentivized.
Where zero-party data is isolated, finite, and brief, Earned Data works towards a full, rich dataset that continually feeds back into a progressive business-consumer relationship. It can include attitudes, characteristics, preferences and propensities – individual-level information which is adaptive and ‘always on’.
The outcome is better engagement over time. Earned Data is the gift that keeps on giving, as it allows you to build trust with customers, deliver more value, and continually gain more data as a result. Our Earned Data Playbook explores the concept and its uses in more detail.
Discover the power of Earned Data
There’s no doubt about it – third-party cookies are the past. The question is, what is your future? While standard first- and zero-party data aim to fill the void left by third-party cookies, Earned Data can go beyond it.
Georgia Deery is Global Marketing Manager at 3radical.