Data is a popular buzzword, but what can you do about it?
The best customers are the ones you already have – so it follows that the best customer data available is the data you already own.
A new report from Econsultancy.com, “The Promise of First-Party Data,” makes a strong case for the advantages and potential of using the data you are already collecting (or should be collecting) about your customers. Other sources of data include second-party data, which is data shared between companies through a contractual agreement, and third-party data from other sites and sources.
While the report ultimately recommends using first, second, and third-party data simultaneously, it also emphasized that maximizing the use of first-party data was “the shortest and best path to superior results.”
Even a small business can do this
Senior marketers from 300 companies with at least $100 million in revenue were surveyed about their use of the three categories of data. Marketers agreed that use of first-party data offered the highest return on investment, and was the easiest category of data to justify investing in. After all, it’s more or less free to catalogue your own data, and it’s also the most readily available data. Scaling up to using second and third-party data can take time and money, while even a budding business can collect and analyze first-party data.
Marketers reported that use of first-party data lead to “true customer understanding and therefore better performance.” In other words, the most successful companies are the ones that best understand their own customer base. While less than half of marketers planned to increase their spending on and use of third-party data, 82 percent planned to up their use of first-party data, and 60 percent want to investigate potential new partnerships for sharing second-party data.
The full report offers more details, such as what specific kinds of data within each category are most useful, and the comparative effectiveness of different types of data for different purposes. “The Promise of First-Party Data” is available for free for a limited time by registering at Econsultancy.com.
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