Disclaimer: This post does not constitute legal advice.
Around the world, businesses are facing tougher laws about personal details. You have to know where all your data came from, and how you’re allowed to use it. This isn’t a choice anymore.
For sales and marketing, third-party data is becoming harder to use, and harder to get. But you still need to understand your audience, and send relevant, personalized messages.
First-party data to the rescue.
Your own first-party data is more important than ever. It is, in fact, a gift. Though it may be one you didn’t expect and didn’t know was so valuable.
To stay compliant, keep selling successfully, and understand the value, you need to know:
- What is first-party data?
- How can you use first-party data?
- Where can you find more first-party data?
…as well as understanding how to manage it.
Let’s clear these things up and look at some ways to boost your chances of success.
What are first-party, second-party, and third-party data?
First-party data is your own information, that you collect by doing business every day. Usually, it includes details about your customers and prospects—like what someone bought, what web pages or apps they use, any survey answers, and the contact details they gave you. You likely store a lot of it in your CRM or CMS.
Third-party data is different, because you buy or rent it from another company. This data is aggregated from various sources, so it can tell you more than your own data alone. But rules like the European Union’s General Data Protection Regulation (GDPR) are making it harder to use.
There’s also second-party data. This is when another company shares their first-party data with you—usually through a partnership or joint promotion. It’s more transparent than third-party data, so it’s probably higher-quality. But you need to make sure you have permission to use it.
Which kind of data is best?
First-party data is considered the most powerful, because it’s relevant and accurate, and you know just where it came from, and when. You’re also more likely to have the consent to use it for your business.
This is especially important now. The GDPR has set new standards for protecting personal data, and any company holding information about European residents needs to comply.
This means global companies in non-European hubs like Singapore and Hong Kong need to take extra care.
Other countries are also tightening their data privacy laws. The European Commission says 13 states, including Japan, now have “adequate” data protection to handle personal information. Talks with South Korea are ongoing, and countries across Southeast Asia are following similar programs. Meanwhile, India’s own privacy bill could become law this summer.
Third-party data can help you find a wider audience. It can also give you new information on your existing customers—like their income level, or who else they buy from. But you don’t know how new the information is, or where it came from.
That makes it hard for marketers to trust. And you could also upset customers by sending irrelevant, unwanted, or poorly targeted messages.
In short, it’s a big risk.
How to use first-party data in sales and marketing
With the right permissions, there are plenty of powerful ways to use first-party data in your sales and marketing. For example:
- Personalization is now essential for marketing messages. People get so many messages that they easily ignore anything that’s not obviously relevant.
- Segmentation based on a customer’s transaction history. When you know what someone has bought, it’s easier to upsell, cross-sell, and build brand loyalty.
- Lookalike marketing, showing your marketing messages to people who match your existing customer profile. The more detailed your data, the more accurate this will be.
- Using analytics and AI to see patterns in your data. Maybe your best customers have some common behaviors. Or you might be able to predict the busiest times for service calls, and staff your call center to match.
Finding the hidden data in your business
There is one problem with first-party data. You always need more.
Some sources are easy to find: your CRM software, customer service records, web analytics, and invoicing system. The only difficulty here is how you integrate all the information into one system, so you have one, detailed picture of your customer.
But not all your first-party data is digital. Your colleagues get useful details in meetings, and telephone conversations—even at the point of sale.
That’s all valuable first-party information, and if you can’t find a way to keep it in your CRM, it’s lost. But if you can find a way to capture the information in a digital format, you can share it, and use it around your company.
For example, think about all the business cards in your office—on desks, and in wallets and rolodexes. All of them carry detailed, current contact information. Each one represents a real-life meeting and conversation. That’s an important data source, with key context information.
Most importantly, the act of giving a business card is an invitation to get in contact. Now all your communications need consent, that makes cards very powerful.
If you can digitize and share that information, you can see and use all the connections you have available.
In the age of GDPR, that makes a huge difference.
First-party data from business cards to CRM
Business cards provide accurate, incredibly valuable data. It’s really a gift. Sansan scans this in with precision and makes it sharable in your company. Your CRM will churn, your MA will produce results. Learn more about using Sansan to leverage high-quality data.