What is Zero Party Data?

Zero Party Data (ZPD) is information knowingly shared by a customer that relates to their preferences and intentions. It is collected and stored by a brand and offers a clear insight into what the customer intends to do or buy in the future, the content they want to receive or how they’d like to be engaged.

Depending on the industry your brand operates in, there is any number of potential Zero Party Data-points that might be of interest to you. Typically, you will want to know what products a customer is thinking of buying, or even what they have no interest in whatsoever. But it could also include their interests, hobbies or even political opinions. Really, any piece of personal information that would be helpful for you to know, and that the customer is willing to share with you, can be Zero Party Data.

And the nature of how you engage with a customer is another aspect to be factored in i.e. what is each customer’s preferred engagement channel to be reached through (email, SMS, push notification etc), what time of the day would they like to be messaged and how often do they want to hear from you?

These are all examples of Zero Party Data-points related to a customer’s thoughts and feelings, which you might otherwise need to assume or make a probabilistic guess at, based on behavioural data.

Is Zero Party Data the same as First Party Data?

For some people, ZPD is simply another form of First Party Data. And this is true, insofar as Zero Party Data is also collected directly by the brand itself. However, the reason that a distinction has been made between them is because there are substantial qualitative differences in terms of what they relate to and how they are collected.

The biggest difference is that First Party Data is behavioural. It’s based on the customer’s activity (browsing and purchase history, total spend to date, category of product most commonly bought, and so on). The customer isn’t directly telling you any of this, you know it because you’re tracking his activity.

When you create campaigns based on historical data, you are making a prediction that the customer will remain consistent in their tastes and preferences.

But let’s be clear, First Party Data, collected across your Point of Sale systems, websites, mobile apps and so on, is still important. ZPD isn’t meant to replace it. In fact, we recommend that the ideal customer engagement strategy should be powered by a healthy mixture of both. When you don’t have enough Zero Party Data, it’s essential that you have behavioural data to fill in the blanks.

First Party Data is what’s used to power next-best-action and decisioning engines, so it’s certainly very helpful. However, no matter how accurate the predictive modelling might get, it’s still only an estimate. Zero Party Data has the advantage in so far as the customer themself has taken the guesswork out of it.

And that’s why it’s worth collecting.

Source

How do I collect Zero Party Data?

Ok, so hopefully you can already see the potential impact of Zero Party Data on your engagement and marketing campaigns. But how exactly do you go about collecting it?

Well, you need to ask for it and have a system in place to store, sort and assign the data to each individual customer’s profile. We’ll look at the best option for storing data in a moment, but let’s think about getting our hands on it first.

There are two ways of doing this, either you a) proactively reach out and ask questions in real time or b) you nudge customers to a place where they can answer these questions in their own time. So that means running interactive surveys or creating self-serve preference centres.

• Interactive surveys

There was a time when manually conducting surveys in person (like at a physical store) was the only way you could gather customer insights. The problem was they were labour intensive and it was often a struggle to get people to participate.

Right now, there are any number of digital alternatives which simplify and hasten the process. We’ve also seen people get creative and build engaging quiz-style forms that are perhaps more engaging than the traditional survey.

We recommend that you incentivise the survey/poll/questionnaire with a discount code or free shipping. After all, the customer is doing you a huge favour.

The issue with a survey is that the information gathered can just easily become outdated as behavioural data. If you aren’t regularly polling customers then who’s to say they still have the same interests? 

We suggest that you kick-off a Zero Party Data acquisition drive with a survey, but back it up with a preference centre where customers can update their profiles themselves.

• Self-serve preference centres 

Given the various categories of content they produce on a daily basis, it’s not surprising that it’s the large publishers who are leading the way in terms of their collection and use of Zero Party Data. 

The New York Times famously has dozens of different daily newsletters that its readers can subscribe to (check them all out here). Below is a small selection, which they present on an interactive page which allows you to opt-in to the ones you want.

This is an example of a really simple self-service preference page.

LiveScore, the world’s largest digital sports publisher, has included a Settings tab that is prominently displayed on their website and within their app. Clicking on it brings up a very simple web overlay that gives the user a number of options to personalise their experience. This is something we’ve worked closely with them on to deliver. Typically, our clients would also include some sort of CTA (“Click here to personalise your communication preferences and profile”) in their email campaigns.

One thing that’s important to note here is that because Xtremepush can identify users based on their IP address, the user doesn’t need to actually create a profile or log-in, in order for these preferences to be saved and remembered.

Where should I store Zero Party Data?

The ideal place to store Zero Party Data, and First Party Data, is within some form of a Customer Data Platform. Why? Because a CDP is built to create detailed, comprehensive customer profiles from a range of sources. 

Our engagement platform integrates with some of the biggest CDPs in the world, including Segment and Optimove. This allows companies using CDPs to execute campaigns using the wealth of data they have collected.

We have also added CDP-capabilities to our platform itself, creating the world’s best unified solution for customer engagement, understanding and decisioning. By creating preference centres, managed from our platform dashboard, we allow marketers to acquire, assign and action data from a single location.

How can I use Zero Party Data?

Practically speaking, it’s actually quite easy to start making this data work for you once you’ve collected it. If you’re using a Customer Data Platform, you will be able to quickly turn data into attributes for use in campaigns. 

An attribute is a sort of tag that is assigned to a customer’s profile. It can be based on any number of factors, as decided by you, and a profile can have as many different attributes assigned to it as you want. These attributes in turn are then used to segment your users for micro-targeting. 

For example, you have a customer who has bought Nike trainers in the past, therefore you add to his profile the following attribute; has_bought_Nike. Now, let’s say you have a sale coming up on all Nike products. You’ll want to make sure that any user with that attribute (has_bought_Nike) hears about this sale on all channels.

This is the most common method of assigning attributes to a customer; they behaved in a certain way some time in the past, so that’s how we categorise them from now on. 

Honestly, this is more often than not fairly accurate. And brands do orchestrate highly successful customer engagement and marketing strategies based on them. However, what they don’t account for is people’s changing tastes and opinions.

This is where the idea of Zero Party Data comes into play. In these instances, the attribute is assigned to the customer because the customer themself has told you that’s what they are interested in right now or in the future. And crucially, if and when they change their mind and make different selections, their profile is updated in real time.

Essentially, what you’re saying to the customer is, “Don’t want to hear about Nike trainers anymore? No problem, tell us what you’d prefer instead. ”And the easier you can make it for the customer to do so, the better things will be for everyone.

How does Zero Party Data relate to GDPR?

It’s difficult, and perhaps even irresponsible, to write an article on customer data without mentioning GDPR and its counterparts around the world like the California Consumer Protection Act (CCPA).

Zero Party Data is, in theory, absolutely permissible under this kind of legislation. But only if it’s collected openly and honestly (i.e. the customer is aware of what’s being collected) and used only for the purposes outlined at the point of permission being granted. 

This doesn’t need to be complicated. If we think back to our example of the New York Times’ newsletters for a moment, the value-exchange is clear; you tell us what you want to receive and that’s what we will email you. That’s as far as the data is going and everyone is happy.

However, what if another publisher was collecting this level of preference data and alongside the daily newsletter you were also sent the occasional sales email promoting products and services related to your interests (e.g. you have signed up for sports content so we’re going to promote a special sports tv channel that we’re partnered with)? This is where things might start to get a little murkier in terms of compliance.

We always advocate for being completely transparent about how you intend to use your customer’s data. There’s nothing wrong with sales campaigns and, from our experience developing campaigns with our clients, most consumers are happy to receive them when they are personally relevant. But be upfront about your intention!