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It’s official, third-party cookies are crumbling… Google has announced its intention to deactivate third-party cookies starting with 1% of Chrome users in the first quarter of 2024 before the complete phaseout by the second half of the year. Today, organizations are seeking to prepare for this monumental change in the way businesses collect customer data. Plus, they are evaluating the types of customer data that matter most to their business. It’s critical for organizations to shift from a “collect everything” strategy to one driven by use cases.
In our blog, “What Types of Customer Data Should You Collect?”, we’ll give you insights into the different types of data that belong in a Customer Data Platform (CDP) and how to set up for the future with a first-party data strategy.
What Is The Difference Between Zero-Party Data, First-Party Data, Second-Party Data, and Third-Party Data?
To set the stage, it’s important to understand zero, first, second, and third-party data. Take a look at the below table to understand what zero, first, second, and third-party data are, how they are used, if they are collected with consent, and examples.
Now that we know the different data types, we’re ready to evaluate the customer data that belongs in a CDP. To level set, we won’t want to include all data. Your CDP will act in concert with systems of record like your data warehouse and CRM that hold a great deal more data than your CDP. You’ll want the CDP to understand the context of customer interactions and have a well-rounded snapshot of the customer to inform intelligent interaction. So, we’ll only want to include purposeful data that defines a person and aids in your use cases. Examples of useful data can include identity data, preferences, behavioral, engagement, and personal identifying information (PII). You’ll want to include these types of data in order to know how to engage your customers in a robust and meaningful way.
Identity Data As Your Foundation
Insider Intelligence reports that 60% of marketers think multiple identity solutions working together will be necessary to replace the third-party cookie. As identity data forms the cornerstone of a CDP, this data is incredibly important. Identity information is the basis you’ll use to construct your customer profile and activate against it.
Identity data is the data you’ll directly use for accurately identifying, and linking customer profiles, in a process called identity resolution. When certain qualifying visitor events occur (like a user signing up for an account or completing a purchase), there is an opportunity to uniquely identify that visitor using an event attribute such as an email address or customer ID. When one of these identifying attributes is provided in the data layer across multiple sessions, Tealium can combine the visitor attributes from those sessions into one master visitor profile. This process helps avoid database duplicates and provides you with richer customer profiles.
To further enhance identity resolution (and beyond) we’ve updated our Identity Partner Ecosystem (IPE) to access a wide range of identity partner integrations across our platform. The IPE facilitates richer data from identity providers – meaning more intelligence for personalized experiences, the ability to improve data quality, and enhanced addressability for targeting. With the IPE, you can augment or activate your identity initiatives with our top-tier identity partners including The Trade Desk, Neustar (a TransUnion Company), Merkle, and more.
What is Preference Data and Why Does It Matter?
Preference data is the information related to a user’s choices. When we understand a user’s preferences, we can better tailor our CX to meet them in the moment. It can include product preferences (like size or color), communication channel preferences, or content preferences. Collecting and activating this data empowers you to tailor your offerings and communications to match individual tastes.
So, let’s start with step one, collecting preference data in a compliant way (this is especially important across regions with strict privacy laws). With Tealium’s Consent Management tool, you can deploy a tracking preferences option on your website. You’ll have full access to customize the code that generates the preferences pop-up, and the ability to translate content for your global customers. Plus, our Consent Manager allows you to connect to OneTrust, TrustArc, and more; providing flexibility if you choose another vendor.
Why Is Behavioral Data Important?
Behavioral data is granular and observational in nature, occurring without explicit action being taken (aside from consent). Examples of behavioral data include hovering over a video for a certain amount of time or clicking through a tabbed website element. In short, it is data measuring what you can observe your customers doing. Behavioral data can be captured with event tracking to understand what offers or items that customers have interacted with, and at what time for a better customer experience.
The important note here is that behavioral data is useful in a CDP when you have a use case to match it to. So, before you start collecting this data, think of the customer journey or outcome you are trying to address. Only collect data that you will directly use to guide the customer towards better outcomes.
Collecting this type of data might sound simple, but it is often more time and labor than what is initially expected. Waiting for development resources to free up to implement event tracking on your digital properties is a real headache, taking vast amounts of time and resources! To address this need, Tealium iQ Events helps decrease the amount of custom code being written and shorten the amount of time it takes to implement web tracking. Tealium iQ Events works without requiring hundreds of lines of code and is both developer and marketer-friendly, providing even more flexibility for organizational alignment and dynamism.
The Value of Engagement Data
Engagement data is the direct interaction between your company and a user. It’s a very specific kind of behavioral data and can include information like how recently a customer has purchased something, a comment on a social media post, or the lifetime value of a customer. The value of engagement data is its ability to provide a holistic view of how customers engage with your brand’s touchpoints and what “state” your customer is in. Have they purchased a lot very recently? Or none at all? Have they engaged recently or not? This information helps refine marketing strategies and assess campaign effectiveness.
What Is Personal Identifying Information (PII)?
Personal Identifying Information (PII) is insights specific to a person. Examples of PII include a person’s name, medical history, driver’s license number or passport. PII is sensitive information (since it’s unique to an individual) and therefore requires stringent protection for the way it is collected, stored, and used. The identity data described above is also PII, but this PII is used more for context and personalization than defining identity resolution (as there are many people with the same name, for example).
The evolution of privacy regulations and the handling of customer data has transformed due to technological advancements and global concerns about data protection. Compliant businesses benefit from increased customer loyalty, risk mitigation, transparency, and competitive advantage, while the challenge lies in future-proofing strategies to adapt to evolving privacy regulations.
In conclusion, we covered four different types of data that belong to a CDP. Additionally, we discussed how to implement a solid, future-proof first-party data strategy. For more resources, check out our whitepaper, “In Data We Trust”, or our video, “Leveraging Customer-Centric Solutions in a Changing Digital Environment.”