Concentrate on, mastering first-party data

Concentrate on, mastering first-party data

Juggling first-party data isn’t always a walk in the park. Keeping it valuable, organised, and easily accessible can feel like solving a complex puzzle. Whether you're just starting your data collection journey or you’re a seasoned pro, the key to success lies in mastering how to handle it effectively. That’s exactly what our Concentrate on series is here to help you with. In this segment, we’re diving deep into the questions everyone has about first-party data and showing you how to make it work for your business.

What is first-party data and how is it collected?

First-party data is data your company has collected from direct interactions between your brand and your customers directly from your own resources. Your business is the first party to collect this information directly from your audience and can include things like data from your own online store, email newsletter, social media channels or form fills.  First-party data often requires more resources but is usually more accurate and reliable than other forms of data.

While first-party data is data you’ve collected through your own channels, second-party data is shared partner data, which allows you to extend your reach and run joint campaigns. Perhaps you have a trusted partner that you work with that shares data with you in a mutually beneficial way for example, maybe it’s a partner for a complimentary product. And then there’s third-party data, which is data collected from multiple different sources and sold to companies who want to have data on specific segments or demographics.  Third-party data gives you a big picture view of markets and trends.

Why is first-party data important to my business?

For B2B companies, first-party data isn’t just useful, it’s essential. While B2C companies often rely on external data sources, B2B companies thrive on gathering insights directly from their customer interactions.  In fact, Deloitte reports in the 2022 Global Marketing Trends that 61% of high-growth brands are shifting to a first-party data strategy and now, a few years on, third-party cookies are systematically disappearing driving the need for first-party data strategies even more.

First-party data makes it possible and easier to retarget and nurture your audiences based on what you’ve learnt about them. This makes it a more personalised experience for your customers and a more targeted strategy for your business.

Ryan Jones, marketing manager at SEOTesting, agrees: “First-party data is really a game-changer because it's data you collect directly from your customers, making it so much more accurate and reliable than anything you'd get from third-party data sources. I think the only third-party source that would come close is a survey company, but even this is still less reliable.”

Since B2B sales cycles are longer and involve higher investment levels, businesses must manage leads throughout the buyer’s journey. First-party data allows companies to personalise interactions, refine their digital marketing efforts, and build stronger customer relationships.

Why is first-party data a trending topic right now?

First-party data is gaining attention primarily due to privacy concerns. Historically, many businesses focused on third-party data as it was easier to source, often overlooking first and second-party data. However, with growing awareness of data privacy and stricter regulations, companies are now investing more in CRMs and data management systems to ensure they collect, store, and process customer data responsibly.

Additionally, platforms like HubSpot have seen significant growth as businesses move away from outdated methods like spreadsheets and email lists. Customers are more aware of how their personal data is used, making first-party data a key focus.

There are a number of privacy regulation changes that put the spotlight on third-party data and are driving marketers to a first-party data strategy:

1. Privacy regulations: with many countries implementing stricter privacy laws such as GDPR, making it riskier to work with second and third-party data. In New Zealand, a bill currently in its second reading in Parliament could make it illegal for businesses to purchase third-party data unless it was originally collected as first-party data. This means businesses relying on purchased lists for cold calling, such as some charities, will need to shift strategies.
2. Depreciation of third party cookies: major browsers are phasing out support for third-party cookies which encourages companies to focus on first-party data as a method of targeting and engaging customers
3. Data accuracy: first-party data removes some of the implied information that third-party data can sometimes have because its incomplete or inaccurate nature.

What are effective ways businesses can collect and use first-party data?

Concentrate has found that the best approach to collecting and managing first-party data is to provide value in exchange for information. Some effective strategies include:

• Lead magnets & gated content: Offering useful resources (e.g., whitepapers, webinars) in exchange for minimal personal details.
• Progressive profiling: Asking for only essential information at first, then enriching data over time-based on customer interactions.
• Reducing friction: Limiting the number of required fields in forms increases the likelihood of users sharing their information.

Businesses should focus on collecting only the necessary data upfront and then gradually enriching it based on user engagement.

Best practices for first-party data collection include:

• Clear privacy policies: Custom-written policies (not generic templates) explaining how data is collected and used.
• Transparent data collection: Clearly stating why data is being collected at the point of capture.
• Personalised email engagement: Sending tailored emails based on user behaviour rather than generic mass emails.

These foundational steps help businesses use first-party data effectively and maintain customer trust.

What challenges do businesses face when switching to a first-party data strategy?

The biggest challenge businesses face when switching to a first-party data strategy is legal compliance. Businesses must understand their legal obligations and engage their marketing and legal team to ensure they are compliant. Even if a company operates outside the EU, GDPR rules still apply to any European citizens in its database.

Other challenges include:

• Upfront investment: Implementing data management systems and restructuring processes requires time and resources.
• Clear customer communication: Businesses must be transparent about data collection without overwhelming users with legal jargon.

A phased approach is best - starting with basic compliance and gradually expanding data management practices.

What are the common misconfigurations businesses make when managing first-party data long-term?

Many businesses fall into the trap of focusing on data collection without thinking about the ongoing long-term management.

Key areas to focus on are:

• Unsubscribe management
  • Many companies don’t have a system to re-engage unsubscribed contacts, missing out on potential opportunities. Marketing emails often have the option to unsubscribe via a button but not the option to potentially re-engage later.
• Data governance
  • Businesses spend resources acquiring first-party data but don’t invest in maintaining its accuracy and compliance over time.
• Customer re-engagement
  • Companies should implement strategies to allow contacts to re-subscribe or update their preferences, rather than losing them permanently. It’s smart to personalise re-engagement campaigns and offer tailored incentives to encourage customer interest.

How can I avoid problems with my first-party data?

There are two key ways you can start out building a legally compliant, insightful first-party data strategy:

• Double opt-in
  • Require users to confirm their subscription via email, reducing disputes and improving data quality.
• Seamless integrations
  • Use platforms like HubSpot to automate compliance and keep your marketing communications in check.
• Clear data management
  • Set up processes to keep your first-party data accurate, organised and legally sound.

First-party data is becoming the go-to choice for businesses looking to stay compliant and sustainable in the long run. So, now’s the time to invest in solid data management practices.

Let’s build a first-party data strategy that works for you. Get in touch - we’ll get it moving.