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    The best way to collect zero-party data? Personalized customer relationships – here’s why

    Consumers have more control over their personal data than ever before, forcing marketers to change the way they collect it. For The Drum’s Data & Privacy Deep Dive, Tim Glomb (VP of content, CM Group) explains how engaging with customers directly will result in better, more actionable insights. 

    We are in the midst of a great transition for marketing. Third-party cookie tracking will be dead in the near future. Apple and others are increasingly allowing customers to opt out of ad-tracking features and privacy regulations are sweeping the globe, giving more power to increasingly data-conscious consumers.

    And good riddance. These are sneaky, creepy forms of collecting data on customers without their knowledge or consent, and deserve to be relegated to the dustbin of history. The consequence of course is that marketers will lose the third-party data sets they’ve relied on for years to power their marketing initiatives.

    So what’s next?

    For marketers who have relied on third-party data sets and cookie tracking to power their customer engagement initiatives, this time of digital disruption is quite the headache. However, for those marketers committed to forging honest, more meaningful relationships the rewards are limitless.

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    It is possible for marketers to know what their customers intend to do or buy in the future by collecting data that is intentionally and proactively shared directly by the consumer. This is called zero-party data – marketers collect this data by connecting directly with consumers and asking them about their wants and needs.

    The case to make this switch is compelling. For starters, customers simply won’t put up with the old ways anymore. A 2021 Digital Consumer Trends Index polled over 5,000 global consumers, and 66% declared that ads based on cookies and tracked behavior were “creepy”, not “cool”.

    Furthermore, numbers show a mere 4% of Apple users are opting in to app tracking for advertisers, and that number is predicted to only dwindle. Consumers are tired of being tracked across the internet, and being served irrelevant ads for things they don’t want.

    Although Chrome isn’t the first browser to phase out the third-party cookie, it is the biggest, accounting for 65.2% of the web browser market. The demise of the cookie could be one of the biggest influences on how to reboot the brand-consumer relationship and establish a path to personalization at scale.

    Implementing a zero-party data strategy

    Zero-party data is becoming the gold standard behind the true personalization the modern consumer expects from the brands they do business with. Unlike first- and third-party data, zero-party data can go beyond past behaviors and preferences to offer insights into the psychographics that really matter: people’s motivations, intentions and interests. Rather than telling you what a consumer has bought in the past, you have the data to know what they intend to buy in the future, why they want it, and even where they’ll purchase or how much they are willing to spend.

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    Zero-party data is collected directly from your customers and not by using cookies. Alas, it’s not simply a case of “ask and you shall receive” – digital consumers are more cautious than ever when it comes to handing over their personal details and preference data. You need to offer a value exchange.

    The value exchange economy

    Questionnaires, polls, quizzes, contests or social stories can incorporate reward mechanics that give consumers a genuine reason to engage and submit their first- and zero-party data. And it doesn’t always have to be a discount or red-letter prize: exclusive content, social kudos, personalized recommendations and loyalty points can also be the catalyst for the collection of opt-ins and zero-party data.

    Many marketers assume that these tactics are immature or fleeting, but global enterprise brands have debunked that myth. For instance, Discovery Communications collected over 100 million entries via a sweepstakes while collecting a handful of psychographic data from each entrant. With nearly a billion data points collected, that information was stored at an individual level and was used to personalize email offers with key home improvement retailers driving millions in new revenue.

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    Once you’ve gathered consumer motivations, intentions, interests, and preferences at scale, you can think about delivering a truly personalized customer experience to beat the walled gardens and the death of the cookie.

    This isn’t rocket science or actually a new tactic at all. It’s simply an example of how brands can use relationship marketing to mimic the way humans interact with each other today. Ask, answer, listen, offer. This is how any conversation among friends progresses. So when brands take an authentic tone it builds stronger bonds with consumers leading to more loyal brand ambassadors and a stronger bottom line.

    Download the Zero Party Playbook to learn more.

    For more on how the world of data-driven advertising and marketing is evolving, check out our Data & Privacy Deep Dive.

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