By Vlad Gozman, serial entrepreneur and the founder and CEO of involve me. Follow @vladgozman on Twitter.
When the saying “data is the new oil” first popped up, it was largely an elusive thought. But now data is increasingly becoming a commodity with real value. Google, whose revenue comes almost exclusively from advertising, is worth more than three times more than ExxonMobil, thanks to its massive amount of user data.
Aside from the largest companies in the world, data is becoming increasingly relevant to marketing and sales teams of all sizes. However, not all types of data are created equal. To create a meaningful and valuable customer profile, teams need to look for ‘zero-party data’.
Why Zero-Party Data Is Better Than Third-Party Data
Zero-party data is customer data that is given directly to a company by the customer, rather than being observed or collected from an external source. Because this data is provided voluntarily and with a full understanding of how it will be used, it is usually both more accurate and of higher quality than third-party data.
Third-party data, on the other hand, is often observed or collected without the customer’s knowledge or consent. This data may be less accurate, and even if it is accurate, it may not always reflect the customer’s current preferences or situation.
Cookies are perhaps the best-known example of third-party data. They allow companies to track a user’s online activity, even across devices, in order to show them targeted advertisements. But in recent years, cookies have become increasingly controversial, with many users now actively blocking them.
So it’s no wonder that browsers like Safari and Firefox are starting to crack cookies. In the near future, third-party data is likely to become even less accurate and reliable. In addition, botnets, which are networks of computers controlled by hackers, can be used to generate fake third-party data.
How marketing and sales teams can collect high-quality zero-party data
Just as not all data is created equal, not all forms of data collection are created equal. To collect high-quality zero-party data, there are a few things marketing and sales teams need to keep in mind.
One of the biggest keys is email validation. By including email validation in your forms, you can avoid duplicate emails, block disposable email addresses, and avoid accepting personal email providers like Gmail and Yahoo. When it comes to phone numbers, you can do similar things to avoid duplicate entries and lock them to a particular country or phone type.
Another important consideration is the geographic location of your customers. If your customers are not in the European Union, you can automatically block access to your forms from EU users. This can help ensure that the data you collect is GDPR compliant.
Finally, you can enrich contact profiles by including quizzes and surveys in your forms. This way you can collect data about a customer’s preferences regarding different topics and tag them with different attributes based on their answers.
For example, an investment bank could use a quiz to collect data about a potential client’s investment goals. The results of the quiz can then be used to automatically generate a customized portfolio for the client based on their risk tolerance and investment timeline.
On a simpler level, a retailer could use a quiz to understand a customer’s style preferences, to make personalized recommendations for future purchases. For example, a fashion brand could use quiz data to send a subscriber weekly email updates on the latest trends that suit their tastes.
You’ve almost certainly seen these types of quizzes before, but what you may not have realized is that they’re also a powerful way to collect customer data. Another popular approach is to use calculators, which can be used to estimate things like a household’s carbon footprint, the potential savings from switching to solar energy, or the value of a customer’s loyalty program points.
Zero-party data is becoming increasingly important as we move into a world where data is more valuable than ever. By following the tips in this article, you can ensure that your marketing and sales teams are collecting high-quality data that can help you better understand and serve your customers.