Understanding data from zero to third-party

24 Mar, 2024

1 min

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A great man once said, “your data is my data”... Wait, maybe it was “my data is your data”. How to get your bearings in this ocean of megabytes?
Every day, at least 1 trillion megabytes of data are created, and last year, we produced around 2.5 quintillion bytes of data a day. 

You can’t even picture it (and it’s normal), yet, Big Data represents interesting business opportunities (better targeting of your customers, UX optimization, visitor tracking…). Taking stock of the different types of data and how we collected them will help you better understand your business, performance and customers. But that’s not it! Today we’ll talk about how the data world has changed and how to adapt to this situation. 

Spoiler alert: third-party data won’t be in, next season. 

Understanding the differences from zero to third-party data

How to know if it’s zero, first, second or third-party, when you come face to face with a megabyte? If your answer is “I never run into a megabyte”, your life must be boring...

What are we talking about? 

Depending on how you collect your data, you will either refer to the data as “zero-party”, “first-party”, “second-party” or “third-party”, but what does that mean?

In a nutshell:

  • Zero-party data: data consumers actively share with your brand.
  • First-party data: data you collect about consumers when they interact with your brand.
  • Second-party data: first-party data a company collected that you are allowed to use.
  • Third-party data: data aggregated from public and non-public sources that don’t always rely on an explicit agreement from the consumer. 

different-data-types

Deep dive into data categorization 

Let’s take a closer look at each data category to understand the bigger picture.

 

Zero-party

First-party

Second-party

Third-party

Collection consent

with consent 

with consent 

with consent

unknown

Customer relationship

direct 

direct  

indirect

indirect 

Owner

not shared 

not shared 

shared with partners

shared between companies

Reliability

high 

high 

low 

high 

Type of data 

individual data 

individual data

aggregated data

individual data

Examples

registration forms, polls, surveys

purchase history, customer information (email, phone number, …)

browsing activity, customer feedback or surveys

demographics, online historic of websites visited

 

The pros & the cons of these data collecting types

Why don’t we only collect zero-party data? It’s reliable, consented and direct data collection… Well, because depending on the use and your means of collecting data, you won’t rely on the same information. 

Zero-party data

If zero-party data seems to be the safest in terms of the privacy policy because the user directly consents to give you a piece of information, it’s far from being enough!

Indeed, zero-party data is short on details. Also, note that customers will only give you the piece of information they want to share, meaning that you’ll probably miss most of it.

First-party data  

First-party data is more accurate than second and third party data because you collect it on your own. Because you inform your customers about the processing purposes of your data collection, they will trust you more! If you’re transparent on your data collecting policy, you might be able to engage more with them.

Unfortunately, if your audience is limited, you won’t be able to collect much data and will quickly be stopped in your data collection. It can also be time-consuming to manage it all on your own. Think about automation to ease your processes!

Second-party data

In theory, second-party data can help you save a lot of time… But are you sure it will give you the information you need? How to know that the company that collected the data made it conscientiously? (You don’t). The issue with second-party data is that you have to trust the company that collects the information for you.  

Third-party data

Sentenced to disappear, third-party data give companies a wide diversity of customer information. Yet, the end of third-party cookies is to come because this collection process isn’t adapted to the privacy-first world that welcomes us. Let’s discover why. 

The end of the third-party cookies

Welcome to a privacy-first world 

Consumer concerns about privacy are just as topical as ever. To protect customers, many companies and social media platforms have already adopted measures to limit the data collected and offer opt-out solutions for customers that don't want their data to be collected. 

How to adapt and keep a solid data strategy?

In an article published by Google, they gave their exclusive advice to “unlock the power of first-party data”. What should we remember from it? How to keep a solid data strategy? 

  • Now, when customers accept to share their personal information with you, they expect to have something that’s worthwhile in exchange. Make sure to create a fair value exchange.

  • Data regulation is evolving fast, but we can’t give you precise updates on this field because we're not a law firm. Make sure that your company is following data governance rules and that you’re transparent with your customers. You can never be too careful with data regulation

  • Be creative! There are so many ways you can ask your customers for their personal information to improve your customer insights.

Zero, first, second and third party:
in which dimension are we now?

Starting from 2022, you will have to adapt to a first-party and zero-party data world and find alternatives to your third-party data insights. 

What do you give to your customers in exchange for their data? Do you make sure it’s fair trade? Let’s talk about it!

By Emma Jeanpierre

31 Jan, 2022