What Is Zero-Party Data?

 

Author: Camille Rosa, Senior Marketing Specialist

All marketers know….data is king. And lately there’s been a new type of data sitting on the throne, known as zero-party data. If you don’t closely follow the data landscape, this is likely a new term you’ve heard floating around, unsure of its meaning for marketers. With the state of the market today, zero-party data is a crucial tool that all marketers should become familiar with. 

Changing Consumer Behavior  

It’s no surprise that consumers are becoming more concerned about their data and how it’s being used. With fears of data breaches or invasive data tracking, consumers are more wary than ever of how their data is collected.  

At the same time, consumers want a personalized shopping experience – one that makes product recommendations based on their interests and doesn’t just blindly advertise to them. Can consumers have the best of both worlds – data privacy and a personalized advertising experience?  

This is where zero-party data enters the chat.  

What Is Zero-Party Data? 

Zero-Party data is relatively new to the data scene. Forrester Research coined the term in 2018, defining it as “data that a customer intentionally and proactively shares with a business.” It can include preference center data, purchase intentions, personal contexts, and data on how an individual wants to be recognized by the brand.” 

Instead of relying on tracking consumers, zero-party data allows consumers to voluntarily offer personal data to a brand. In exchange, consumers are expecting their freely given information to improve their shopping experience.  

Let’s go over some examples of questions brands might ask to gather zero-party data: 

  • “Tell us about your most recent shopping experience with us.” 
  • “How much does sustainability impact your purchasing decisions?” 
  • “What problem does this product/service help you solve?” 
  • “What are some of your hobbies?” 
  • “Do you prefer one email per week or one every two weeks?” 

How do brands capture the answers to these questions? 

  • Pop-up windows  
  • Opt-in forms 
  • Social media prompt questions 
  • User profiles 
  • Polls, quizzes, and surveys 

 

How Does Zero-Party Data Fit into the Data Landscape? 

Zero-Party Data – This type of data is voluntarily given by the consumer and thus requires no inference or analysis to determine its meaning.  

First-Party Data – This type of data comes from consumer information such as tracked website activity, purchase history, or contact information to make educated assumptions about the consumer’s interests. First-party data is a highly accurate source, but still requires analysis, unlike zero-party data. 

Second-Party Data – This type of data is another company’s first-party data that is received via some type of partnership. The same type of information as first-party data is collected, but it’s not directly from the first source. 

Third-Party Data – This type of data is bought from an outside source that is not the original collector. 

 

Zero-party data

 

Death of Third-Party Cookies 

As consumer data tracking has become more regulated and privacy concerns have grown, third-party cookies have become phased out by several companies, including Firefox and Safari. Google is set to have them fully phased out by 2024. 

What does this mean for marketers? Privacy will remain a concern for consumers. Now is the time to begin collecting data in other consent-based methods, such as zero-party data. 

Using Zero-Party Data in Your Marketing  

One sure-fire way to grow revenue is to show consumers products and services that are tailored to their interests. It’s a no brainer, right? Brands have been doing it for years.  

Not only is zero-party data the way of the future, but it is also more accurate as it comes explicitly from the consumer. When used in combination with first-party data, marketers can gain extremely valuable insights into the desires of consumers, ultimately offering them a better brand experience with less controversial data methods.  

Now is the time to do an audit of how you are collecting your data and how you’re making the data work for you.  

Learn more about our data services and how we provide prospect leads by utilizing multiple data sources and generating predictive models here. 

 

Direct Mail Testing is Like the Stock Market: Here’s Your Investors Guide

When we talk direct marketing to marketers, the subject of direct mail testing inevitably comes up. For some, it’s all about creative testing, where testing might be tweaking existing creative once a year. For others, it’s a regular creative testing program, with new creative being tested with every campaign. For still others, testing may include offer, copy, contact cadence, list, and predictive model testing as part of the necessary mix. But why this range of approaches and is there a right way?

We find that the frequency and scope of testing depends on budget, your product or service, one’s risk tolerance, and prior experience with testing. This last item is a big one – many people are simply unfamiliar with what a regular testing program looks like and its value.

I like to think of testing as similar to long-term investing in the stock market. With all of the recent attention paid to artificial intelligence, I decided to informally check my theory by asking AI provider ChatGPT about the value of long-term investing. Here are the key value points to long-term investing that came back, with my comments:

  • The Earning of Compound Interest – With enough time, the compounding of interest leads to major growth. When we test, we accumulate a long-term knowledge base of what works and what doesn’t.
  • Reduced risk – Given time, short-term risk fluctuations are reduced. Same thing in direct mail testing. Each time we test, we learn a little (or a lot) more, which reduces risk.
  • Potential for Higher Returns – Long-term investing is associated with higher returns. Same as with testing. When we are in testing for the long-term with a regular, consistent program, we are “in it to win it.”
  • Diversification – When we diversify our investments, we reduce our risk. So when we test a variety of items we learn more, which leads to less risk and greater performance in the long-term
  • Ability to Meet LongTerm Goals – Long-term investing can help us reach long-term financial goals, like education funding and retirement. Testing enables us to reach our long-term marketing performance goals.
  • Peace of Mind – Long-term investment can lead to greater piece of mind. When we run a comprehensive testing program, we have the peace of mind that we’ve left nothing to chance.

The challenge for many marketers is that they are unfamiliar with how to structure a best practice testing program.

That’s why we created Nahan’s Guide to Direct Mail Testing!

In this white paper, we provide an insiders guide to effective direct mail testing for programs of all sizes and across industries. It doesn’t matter if you’re just getting started with testing or a seasoned pro, our guide will provide you with actionable insights you can implement today.

Learn how the four phases of the testing process work together to drive optimization.

  • Research
  • Pre-Testing
  • Testing
  • Post-Campaign Assessment

If you’re ready to test smarter and drive ROI for your program, fill out the form below for the full guide to direct mail testing today! 

The Risk in Not Testing Your Direct Mail

 

Author: Alan Sherman, VP Marketing Strategy

If you’ve been in the direct marketing space for any amount of time, you’ve certainly heard about the importance of testing. But “testing” means different things to different people, and we see people approach it in a variety of ways. My colleague, Maggie Stack, recently published a blog on Direct Mail Testing. Consider this a prequel – insights into the risks of not testing.

Testing “Approaches” Run the Gamut

Some marketers don’t test on a consistent basis or simply don’t test at all. After mailing the same creative package, list or offer, for months or even years on end, they experience the inevitable performance decline, and think it may be time to test a new creative. Their creative team or agency offers a new creative that hopefully out-performs the old one and then the process repeats itself. Still other marketers occasionally test but are so risk averse that they test small creative attributes, such as a headline in a letter or on an envelope, which rarely moves the performance needle. And data testing happens less frequently than creative testing, even though data has a more significant impact on results.

A Fear of Testing

Why the reluctance to test? Some marketers simply don’t know how. Others may not want to risk the company’s budget on a test that may not out-perform the control. Sometimes it’s a combination of the two – “I don’t know how – so why take the chance?”

What About Data Testing? I hear less about this than creative testing.

Why is there so little data testing? Data can be tougher to test – nowadays it would be less likely for us to test an entire list. With the cost of postage, we must be as precise as possible. Segments or model groups within an audience are not always easily explained or understood. Many lists should not be mailed without the use of effective predictive models to rank prospects. It feels riskier than changing a creative headline, or maybe data is managed by another group in the organization.  Maybe the data testing setup and measurement can feel daunting. We can hold and touch creative – it feels more “real” than data and many of us like to think we intuitively know what works in creative when it’s sometimes best left to the direct mail creative experts. 😊 And yet data has a larger impact on response than creative.

The Risk in Not Testing Your Direct Mail

Some might apply the old saying “If it ain’t broke, don’t fix it” to direct mail testing. I would argue if it ain’t broke yet, it will be some day.  I would say that there is greater risk in NOT testing. Every creative package’s performance declines over time, and if you wait until that happens you could find yourself many months away from a new, high-performing package. The same applies to data. Doing nothing is short-term thinking that, over time, delivers inferior results. Regular testing is an investment that puts the long-term odds in your favor. Every test is an opportunity to learn and improve.

How frequent should testing be done?

Testing must be a regular ongoing process. Ideally, that means part of every campaign or at least testing quarterly. The aim is to develop a stable of high-performing creative packages and a precisely optimized audience by testing new data sources and predictive models to continually improve results.

We can make testing work for you. Testing is both art and science – Nahan offers both. We will continue to cover various aspects of testing in upcoming blogs.

Are you currently testing your direct mail programs?

Testing is a key component of any successful direct marketing program. The most impactful direct mail marketers are constantly testing creative, lists, and offers, which enables them to make marketing decisions armed with more insight.

We have found that testing means different things to different people. Clients approach it in a variety of ways.

In this white paper, we provide an insiders guide to effective direct mail testing for programs of all sizes and across industries. It doesn’t matter if you’re just getting started with testing or a seasoned pro, our guide will provide you with actionable insights you can implement today.

Learn how the four phases of the testing process work together to drive optimization.

  • Research
  • Pre-Testing
  • Testing
  • Post-Campaign Assessment

If you’re ready to test smarter and drive ROI for your program, fill out the form below for the full guide to direct mail testing today!