Blog 5 min 10/14/2020

What is Zero-Party Data?

Zero Party Data

Global privacy regulations. Death of the third-party cookie. Ad blocking. 

These terms point to the fact: we’ve entered a new era of data privacy. And the future of marketing will look a whole lot different than what we’ve grown accustomed to over the past decade. 

But there’s ample opportunity for marketers and publishers. 

Sure, the industry is forcing you to move away from the use of third-party data. But the good news is, there’s something way better: data that comes straight from your customers. 

This data is higher quality, there’s more of it, and it’s going to take the guess-work out of identifying your target audiences. It comes from trust, not third-party cookies. This is what we call zero-party data

Zero-, First-, Second-, and Third-Party Data: What’s the Difference? 

There are four different types of data organizations collect and utilize for their marketing efforts. While they all have one thing in common – the collection and housing of consumers’ personal information for more targeted campaigns – they differ in how data collection takes place. 

Here’s the difference between zero-, first-, second-, and third-party data: 

  1. Zero-Party Data: Zero-party data is often considered a subset of first-party data. It’s directly provided by consumers, usually addressing communication preferences. 
  2. First-Party Data: While also originating directly from consumers, first-party data may be collected to support a transaction or as a support or service requirement.
  3. Second-Party Data: Second-party data usually refers to someone else’s first-party data. Purchasing data from another organization or sharing data through a partnership falls within this category.
  4. Third-Party Data: A variety of sources collect third-party data. Behavioral data, advertising data, browsing data, etc. A lot of times, third-party cookie tracking collects this data – a topic causing controversy for industry professionals.

The Movement Towards Zero-Party Data

As noted above, there’s a lot of controversy about third-party data collection, especially through cookie tracking.  As consumers become more aware of it, they’ve also become less comfortable with the idea of data targeting. And global governments and even big tech are now involved to “kill” third-party cookie tracking.

Third-party data derives from every source except consumers. It comes from credit scores, cookies, and click trials. As a result, it’s created poorer quality data and less effective campaigns. 

Not to mention, third-party data created a massive knowledge gap between marketing professionals and their consumers. While many marketers might feel their audience trusts them with their data, statistics show only 28% of consumers actually feel they know what companies are best protecting their personal information. 

This is where zero-party data comes into play. 

The collection of zero-party data presents a real opportunity for brands to run more effective campaigns by collecting data from the source – all while building trust and transparency with their consumer base.

The Opportunity: Building Trust

Marketers, advertisers, and publishers are caught in between the old way of doing things and trying to figure out where to go from here. There is plenty of uncertainty right now. 

However, if there’s one thing that holds true about the marketing industry, it’s that it’s an industry full of resilience and creativity. 

Here are three ways the collection of zero-party data benefits both you and your consumers. 

  • Earning Consumer Trust Through Transparency

The most significant benefit of using zero-party data is that it comes directly from the source: your customers. And if you think they’ll be hesitant to hand it over, we’re here to provide some good news. 79% of consumers are willing to share their data if there’s a clear benefit for them. So as long as you’re transparent about why you’re collecting the data, your audience will more than likely feel comfortable providing it.

  • Better Quality Data – And More of It

No longer are you purchasing data from a third party who may or may not keep that data clean. Hard bounces, poor targeting, and money flushed down the toilet can be a thing of the past. And since you’re asking your customers for it directly, you are able to ask for more data than you might have through purchasing it. Want their t-shirt size? Just ask. Want to know their favorite color? Again, just ask.

  • More Effective Campaigns

Extending from the last point about higher quality data and more of it, collecting zero-party data allows you to increase personalized campaigns across all stages of the customer buyer journey. Information such as purchase intentions and preferences are useful to improve your personalization strategy and help build a more accurate picture of who exactly your customer is. 


What’s Next? 

In summary, the benefits are clear. Capturing your audiences’ intentions, interests, motivations, and preferences at scale allow your brand to create a truly personalized experience for each customer. Taking the lead as a brand that’s transparent about your intentions with data tells your customers you’re an organization they can trust.

To begin collecting zero-party data, your brand needs to spend some time creating a Trust Center where consumers can update their preferences and opt into data collection. 

This webinar goes over everything you need to know about starting to collect zero-party data. 

Need help getting started? OneTrust PreferenceChoice provides a full suite of solutions for marketers and publishers to manage the consent, preferences, and first-party data of their customers. Request a free trial or connect with one of our team members today


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