What Is Zero-Party Data and How Can Marketers Use It?

The death of third-party marketing data is nigh, the walls of the walled gardens of data are getting higher, and ad budgets are getting tighter than a 2008 hipster’s skinny jeans. This is leaving marketers scrambling to remake their data-driven marketing strategies while shouldering demands to find untapped pockets of data that can drive revenue and reduce acquisition costs. It’s a bit like trying to dig a quarter out of those sweet skin-tight Levi’s—the data’s in there somewhere, but you can’t get your fingers on it. 

For many marketers, the answer lies in zero-party data. But what is it, how do you get it, and what can marketers do with zero-party data? Let’s dig into the bottom of that tight pocket and find out. 

What is Zero-Party Data?

Zero-party data is data that is willingly and proactively shared by the customer with a company. It’s information that the customer provides directly to your company, without any intermediaries or third parties involved. 

The great thing about zero-party data is that it gets to the heart of your customers’ desires, including their preferences, interests, and purchase intentions. Best of all, it’s not inferential—it’s pretty much your customer willingly and directly telling you “This is what I want,” so it’s much more accurate than any third-party data source ever could dream to be. 

What Are the Benefits of Zero-Party Data?

Zero-party data is a powerful asset that allows businesses to gather insights directly from their customers about their preferences and needs. By fostering a transparent and respectful relationship, zero-party data empowers marketers to create more personalised experiences, improve security, and enhance overall marketing efficiency. In this section, we will explore the key benefits of zero-party data, highlighting how it can transform marketing strategies and drive stronger customer connections.

1. Enhanced Personalisation

Zero-party data enables marketers to craft campaigns that resonate deeply with their target audiences. By collecting information directly from customers about their preferences and needs, businesses can tailor messaging and offers that truly align with individual interests. Such a personalised approach leads to higher engagement rates and increased customer satisfaction.

2. Improved Customer Insights

When marketers gather zero-party data, they gain a deeper understanding of their customers. This insight goes beyond demographic information, allowing brands to uncover specific preferences and behaviors. As Tina Moffett, a principal analyst at Forrester, noted in our webinar, “Now we see marketers really doubling down on zero-party data and first-party data because not only can it inform experiences, but it can help better understand how advertising and performance media is driving to a website or to a call centre.” This understanding can significantly enhance marketing strategies and decision-making.

3. Greater Data Security

One of the standout advantages of zero-party data is its enhanced security. Since this data is collected directly from the consumer without intermediaries or third-party involvement, the risk of data breaches is significantly reduced. A direct relationship fosters a safer environment for both businesses and consumers.

4. Respect for Consumer Privacy

Zero-party data is inherently more respectful of consumer privacy. Customers willingly provide this information with the understanding that it will be used to improve their experiences. This transparent exchange builds trust between brands and consumers, allowing businesses to serve their customers better while maintaining ethical standards in data collection.

5. Increased Marketing Efficiency

By utilising zero-party data, marketers can streamline their efforts and allocate resources more effectively. With clearer insights into customer preferences and behavior, campaigns can be optimized for better performance. Improved efficiency not only saves time and money but also enhances the overall return on investment for marketing initiatives.

How is Zero-Party Data Different from First-Party Data?

Okay, I know you’re like, wait, this sounds a lot like first-party data. But there is a distinction. First-party data is data that is collected by the marketer based on the customer's interactions with their website, social media channels, or other owned properties. This can include things like website visits, purchases, and social media interactions. First-party data is typically collected through cookies, pixels, or other tracking mechanisms.

The key difference between zero-party data and first-party data is the source of the data. Zero-party data comes directly from the customer, whereas first-party data is collected by the marketer based on the customer's interactions with their owned properties. This makes zero-party data more valuable because it’s more accurate and reliable.

How Can Marketers Gather Zero-Party Data?

Gathering zero-party data is key for marketers aiming to create personalised customer experiences. However, successfully collecting zero-party data requires a thoughtful approach. Marketers should focus on creating engaging and interactive opportunities for customers to share their insights. By making the process enjoyable and rewarding, businesses can build stronger connections with their audience while gaining valuable insights.

Here are some effective methods for gathering zero-party data that not only enhance marketing strategies but also foster customer loyalty and satisfaction:

• Surveys and polls: Use short, engaging surveys and polls on your website or social media channels to ask customers about their preferences and interests. Offering a small incentive, like a discount or entry into a giveaway, can boost participation.
• Quizzes: Create interactive quizzes that help customers identify their preferences while providing personalised recommendations based on their answers. This approach makes the data collection process enjoyable and informative.
• Loyalty programs: Implement loyalty or incentivised programs that reward customers for sharing their information. Offer exclusive perks, such as personalised recommendations, early access to products, or special discounts, to encourage participation.
• Interactive content: Utilise interactive content, such as calculators or games, that prompts customers to input their preferences. This approach not only engages users but also provides valuable insights into their interests.
• Conversation intelligence software: Use conversation intelligence tools to analyse customer interactions. These tools can gather sentiment and preferences by monitoring customer conversations, enabling marketers to gain deeper insights into customer behavior and preferences.
• Email preferences centre: Create an email preferences centre where customers can indicate their interests and the types of content they want to receive. This empowers customers to share their preferences while ensuring they receive relevant communications.
• Social media engagement: Actively engage with customers on social media platforms by asking questions and encouraging them to share their thoughts and preferences. Running contests or asking for feedback on products can foster participation and data collection.‍
• Feedback forms: After a purchase or interaction, follow up with customers through feedback forms that ask about their experience and preferences. This not only gathers valuable data but also shows customers that their opinions matter.

Is Data Gathered From Conversation Intelligence Zero-Party or First-Party Data?

When it comes to collecting data from customer phone calls using conversation intelligence software like Invoca, you get both zero-party and first-party data. 

Conversation intelligence and call tracking platforms like Invoca can collect digital journey data that led a customer to call your business. This includes ads they clicked on, web pages or social media they interacted with, items they placed in their online shopping cart, and so forth. This is first-party data because it is based on customer interactions and it is collected without the involvement of a third-party data source, but the customer did not intentionally hand it over. 

Once the customer is on the line with an agent in your contact centre or a rep at a business location, the zero-party data party begins. Your customer is deliberately asking or answering questions, and willingly providing that information with the knowledge that you will use it to assist them. With a conversation intelligence platform, you can access, analyse, and take action on zero-party data from customer conversations at a massive scale, and it can be used to accurately optimise and personalise the customer experience because the data literally came straight from their mouth.

What Can Marketers Do With Zero-Party Data?

Once you've gathered zero-party data, the opportunities to use it for enhancing customer experiences are vast. Here are several impactful ways to use zero-party data:

1. Personalise Your Messaging

Using zero-party data allows marketers to craft personalised messaging that resonates with individual customers. By understanding customers' preferences, interests, and pain points, brands can tailor their communication to speak directly to what matters most to their audience. This can include personalised email campaigns, targeted social media ads, and customised website content. For example, if a customer shares that they are interested in eco-friendly products, marketers can highlight their sustainable offerings in future communications.

2. Create Targeted Campaigns

Zero-party data enables marketers to develop targeted campaigns that cater to specific segments of their audience. By analysing the preferences and interests shared by customers, brands can identify distinct audience segments and create campaigns that speak directly to each group's unique needs.

For instance, a fitness brand could segment its audience based on the types of workouts customers prefer, such as yoga, strength training, or running. With this information, the brand can create tailored marketing campaigns that feature relevant products, promotions, and content for each segment, thereby increasing the likelihood of engagement and conversion.

3. Improve Your Product Offerings

Zero-party data provides valuable insights into customer needs and preferences, allowing marketers to enhance their product offerings. By analysing the information gathered, businesses can identify gaps in their current product lineup or opportunities for new features that align with customer desires.

For example, if customers consistently express interest in a specific product variant or feature during surveys, businesses can prioritise developing those offerings. Additionally, gathering feedback on existing products can lead to necessary adjustments and improvements, ensuring that the products meet customer expectations. This customer-centric approach to product development fosters innovation and drives satisfaction, leading to higher retention rates.

4. Optimise Your Website and Owned Properties

Another significant advantage of zero-party data is the ability to optimise your website and other owned properties for a better user experience. By understanding how customers interact with your digital assets and what information they value, you can make informed decisions about design, navigation, and content placement.

For instance, if zero-party data reveals that a significant portion of your audience prefers visual content over text, you might consider adjusting your website to feature more videos, infographics, and images. Additionally, implementing user-friendly features such as personalised landing pages or tailored recommendations can significantly enhance the overall customer experience.

5. Enhance Customer Support and Engagement

Zero-party data can also be instrumental in improving customer support and engagement strategies. By understanding customers' preferences for communication channels (such as chat, email, or phone), businesses can provide tailored support that aligns with their needs.

For example, if a customer indicates a preference for instant messaging, support teams can prioritise that channel to deliver prompt assistance. Additionally, analysing zero-party data can help identify common customer pain points, allowing businesses to proactively address issues and enhance the overall support experience.

‍Request your personal demo to learn more about how you can take action on zero-party and first-party data from customer conversations with Invoca.