What Would a First-Party Data Only World Look Like?

What Would a First-Party Data Only World Look Like?

For years, well-respected industry leaders, from brands and agencies, have been proclaiming that third-party data was a thing of the past. The thought was that first-party data was performing better, and the focus was pivoting away from third-party data. This was common even before Google formally announced its plans for Chrome in 2020. Fast forward to the present day and the proclamations have become more pronounced. Big brands are doing everything they can to amass troves of first-party data, out of an intensifying fear that third-party data is dead.

Focusing on first-party data is paramount for future success, but to say that first-party data is the only data type going forward is false and does a disservice to the industry. It’s factual to say that third-party cookies are going away, but that should not be conflated with third-party data. In fact, despite all the attention on the issue, it’s not always clear when data should be classified as first- or third-party.

Pivoting away from all partner data completely limits how brands can use insights to grow their businesses, and potentially leads to walking away from healthy partnerships that have been a key part of their success.

Of course, money never lies, and it shows a disconnect between what advertising leaders are saying and what they are actually doing. Spending on third-party audience data continues to trend upward, amounting to a $12 billion market, according to the IAB. When someone tells you a growing multi-billion-dollar market is “dead,” it should give you reason to pause.

Just how vital is third-party data? Let’s examine what the ad world would look like if first-party data was the only type to exist when we wake up tomorrow.

Increased customer acquisition costs

Strong first-party data is a critical asset for curating and building lasting relationships with existing customers but has limitations when it comes to acquiring new prospects. Look-alike modeling is incredibly popular, but many platforms that offer this service rely on third-party data to model effectively. We’re already seeing companies like Facebook suffer due to restrictions like ATT, and a complete lack of third-party data would diminish their ability to power analytics. As powerful as first-party data is, there are gaps in the data set.

Inconsistent Cross-Channel Targeting

As mentioned, there is often conflation between third-party data and third-party cookies. Despite a reliance on third-party cookies in some channels, brands currently use third party data sets that are not tied to cookies to reach consistent audiences across screens and offline channels. Working only with first party and publisher data limits reach by reducing the ability to activate data in other channels. As a result, scale and accuracy will be different in each environment, whether a brand partners with a digital publisher or a CTV provider. Without supplemental data to build their graphs, match rates will decline across the board for pubs, platforms, and onboarding services.

Decreased Analytics/Machine Learning Performance

Modern advertising is dependent on machine learning and AI, and those tools are dependent on data flowing into predictive models. Limiting these technologies to first-party data results in predictions based on a narrow view of customers. Cost-conscious brands may find that the juice isn’t worth the squeeze of investing in AI.

Faster Data Decay

The pandemic threw a wrench into historic ideas of the customer purchase journey, resulting in a lasting change to the way that people buy things. Trying to stay up-to-date with trends requires up-to-date data. Certain attributes are steady, like age or gender, but others change frequently. If you only have first-party data, the likelihood of data degradation increases because brands can only update data when they capture or observe a change within the context of their business. Especially in the case of inactive customers, being able to access accurate third-party data to validate first party data will enable optimized re-engagement efforts.

Dispelling the Myth

While the rhetoric continues, it’s clear that third-party data enhances the entire ecosystem. Anything close to the “death” of third-party data eliminates much of the functionality that marketers rely on across channels, not to mention millions of dollars in healthy business partnerships and jobs across the ecosystem.

Properly sourced, privacy-compliant third-party data is exceptionally valuable to the success of modern marketing efforts. When it is taken out of the equation, the marketer is left with data that can be thin, impacting campaign accuracy and scale. While a strong first-party data asset is key to future success, modern data strategies mix first- and third-party data to deliver more impactful advertising.

Interested in learning more about how Alliant’s DataHub brings together the power of first, second and third party data?  Reach out to our team of data experts!

ABOUT JOANNE

President & Chief Executive Officer

JoAnne is the founder of Alliant – and the architect of our vision to deliver innovative consumer targeting solutions powered by the aggregated purchase transactions of multiple direct-to-consumer marketers.

A lifetime marketer, JoAnne’s career includes positions at Time Life, The Norman Rockwell Museum, and Mal Dunn Associates. She is a committed advocate for development of comprehensive data governance and security standards, and has a long history of industry service. She is also an expert baker.

Happy Spring!

After what felt like a long winter, a change of season brings new life, growth, and exploration. To support the growth of our DataHub Member community in unprecedented times, Alliant has invested in research with the Winterberry Group, diving deep into collaborative data solutions and how they will help shape next frontier of data-driven marketing.

If you have not already signed up, please join us, this Thursday, April 1st for an exclusive Member Webinar featuring Winterberry’s Managing Partner, Bruce Biegel. Bruce will be joined by Kurt Kendall, Chief Data Officer from longtime DataHub Member, Publishers Clearing House, and Alliant experts Donna Hamilton and Matt Frattaroli. Together their conversation will illuminate how your DataHub Membership places you a step ahead of many brands, and introduce ideas on how you can develop more collaborative data strategies within your existing partnerships.

This is a not to be missed event, and Alliant is buying lunch. Register now to secure attendance and your lunch delivery code. 

We hope to see you all there on Thursday and I personally look forward to checking in again in Q2 when we expect even more collaborative innovation to have sprung up.

As always, please contact me directly if there is anything I/we can do to support your business initiatives.

JoAnne Monfradi Dunn
President & CEO

ABOUT JOANNE

President & Chief Executive Officer

JoAnne is the founder of Alliant – and the architect of our vision to deliver innovative consumer targeting solutions powered by the aggregated purchase transactions of multiple direct-to-consumer marketers.

A lifetime marketer, JoAnne’s career includes positions at Time Life, The Norman Rockwell Museum, and Mal Dunn Associates. She is a committed advocate for development of comprehensive data governance and security standards, and has a long history of industry service. She is also an expert baker.

Brands Need to Use the Pandemic to Clean Up their Data

Brands Need to Use the Pandemic to Clean Up their Data

Originally published by ClickZ, this commentary from Alliant’s CEO encourages brands to see the rapid shifts in consumer behavior as the best reason to focus on data hygiene and relevancy.  As DataHub Members, we know you already see the value in organized and hygiene data, but with a never-ending stream, there is constant room for improvement to make sure your data and solutions are best serving an ever-changing customer.  

The pandemic has profoundly changed how consumers behave, at least for now. Extended work from home, fewer shopping trips, less travel and increased online buying are the norms, resulting in dramatically different behaviors than we saw at the start of the year.

 Brands and agencies have needed to shift their audience strategies, in some cases building new models to ensure that their targeting capabilities are up to date with the latest behavioral trends.

An unexpected wave of unemployment, following years of job creation, can wreak havoc on audiences. A consumer who had been gainfully employed may now be under- or unemployed, having a difficult time making their mortgage, and altering their normal purchasing patterns and other behaviors, such as savings.

Making first-party data more accessible is the first step in responding to behavioral shifts during the pandemic

Change needs to occur, in both the audience solutions, as well as marketers’ perceptions of “audiences.”

While building new models or expanding a data strategy isn’t hard, assembling the foundational components can be complicated and/or time consuming. Many brands’ CRM data is still not as clean and accessible as possible, which creates challenges and slows down the targeting process. In an era where things change by the day, lost time equals lost customers.

Mandatory evolution caused by the pandemic

For years, audience-based ad planning was rooted in what worked in past campaigns and what didn’t, and then optimizing toward the most successful outcomes.

Given the massive upheaval in consumer life, it would be insane for marketers to expect the same results from the audience products they’ve used over the past several years, as well as the same behaviors from the consumers within the audiences.

The current situation requires advertisers to actively participate in keeping their CRM data clean and accessible – laying the critical foundation to rebuild their audience models and solutions.

Whether it’s layering second- or third-party data, harnessing machine-learning or a hand-crafted model, they need to collaborate to find a combination of behaviors that reflect what is happening right now with their target consumers.

Providing the right kind of data, easily

The need to understand audiences much faster has made brands’ own first-party data more important than it has perhaps ever been.

While accruing data is easy for most brands, passing that data along to an agency or audience partner can prove to be a challenge. These organizations are the ones that need to rebuild models and deliver audiences that more accurately reflect the current, ever-changing buying cycles. The best way to do this is through the fast, clean sharing of data.

Getting the data from the advertiser can be the bottleneck that prevents quick, accurate audience models from getting built. This has sped up considerably on the digital side, but it still lags behind in traditional media.

The complicating factor is often the many feeds of data that brands supply. Arriving from different sources and in different formats, they don’t all necessarily combine easily, creating more work for the agency or vendor who is modeling the data. For some, it’s a seamless process, but for others, it can be a discordant mess.

The major advances in audience-based advertising should have enticed brands to make their data as clean as possible.

But for many, they viewed this more as a long-term project or a “nice to have.” That’s no longer the case – brands that want to stay vital and survive this pandemic and beyond are living on borrowed time if their data isn’t cleaned up and maintained.

Brands that want to serve existing customers better and grow their businesses during the pandemic should focus on cleaning up their first-party data, ensuring they can pass it along easily and maintain a customer informed edge. It will speed insight, change and let them get their messages to the right people faster.

ABOUT THE AUTHOR

JoAnne Monfradi Dunn, President & Chief Executive Officer

JoAnne is the founder of Alliant – and the architect of our vision to deliver innovative consumer targeting solutions powered by the aggregated purchase transactions of multiple direct-to-consumer marketers.
A lifetime marketer, JoAnne’s career includes positions at Time Life, The Norman Rockwell Museum, and Mal Dunn Associates. She is a committed advocate for development of comprehensive data governance and security standards, and has a long history of industry service. She is also an expert baker.

Welcome to the Season of Big Ideas

The Holiday season is a natural time to count blessings, give thanks and plan for the future. With the unbelievable challenges in 2020, many of us are probably more focused on looking ahead rather than looking back. Yet, as a marketer contemplating the lengthening shadows of 2020, it makes sense to revisit the lessons learned over the year — and consider how they might form the foundation for 2021.

We can all agree, consumer behavior has changed — and many of those changes are likely to be with us for some time. You know the trends: more time at home; more time to consume media in every channel; and more time and money being spent on creature comforts.

Our careful assessment of new-to-file additions to the DataHub confirms these trends and helps steer the ship for 2021. Destination: multichannel mastery.

An important DataHub observation was an increase in orders and new customer acquisition across email, internet, TV and even direct mail (when it was sent), in some cases up 117% from 2019. Our takeaway? Establishing a diverse, integrated and nimble channel mix is more valuable than ever.  As a DataHub Member, you have unique access to enrich your hard-earned data and audiences to reach consumers in any channel, improving ROI on Membership. If you are only focusing on one channel, you are missing out.  

Plan now to integrate your multichannel strategy, aligning multi-use creative, messaging and targeted audiences. Consider your Alliant AE or Sales Executive as a partner on this journey. They can help you survey your data, scope the opportunity, structure a test and put measurement mechanisms in place. Once you start seeing new customers from that channel, we will integrate that feed into the DataHub, helping to monitor and optimize this new channel.

The Alliant team has been truly humbled and honored to partner with you this year. We are full of creative ideas to help you grow your business in 2021 and look forward to the innovative solutions we will develop together.

It is the beginning of a beautiful New Year.

Wishing you Prosperity and Health for 2021,

JoAnne Monfradi Dunn
President & CEO

ABOUT JOANNE

President & Chief Executive Officer

JoAnne is the founder of Alliant – and the architect of our vision to deliver innovative consumer targeting solutions powered by the aggregated purchase transactions of multiple direct-to-consumer marketers.

A lifetime marketer, JoAnne’s career includes positions at Time Life, The Norman Rockwell Museum, and Mal Dunn Associates. She is a committed advocate for development of comprehensive data governance and security standards, and has a long history of industry service. She is also an expert baker.

Adapting to the New Normal

One interesting observation I’ve heard about COVID-19’s impact on our lives and businesses is the accelerated adoption of new “norms” that otherwise might take five to ten years to come about naturally.

The rapid shift to remote work and tele-learning are two obvious examples. The surge in food delivery and media subscriptions — as we’ve observed in our own DataHub — is another powerful signal.

No doubt you have other examples from your own experience. Love it or hate it, we have no choice but to incorporate rapid change into our lives and our businesses. And while change is nothing new in the marketing industry, it is coming at us faster than ever.

If you look at it through the right lens, that spells opportunity.

The content of this newsletter illustrates some of the ways our organization embraces change so that we can better serve yours. Thought-leadership in data governance and our rapid adoption of machine learning (“with caveats”), are two examples of racing toward the future. Other initiatives include expanding Alliant’s identity map, and innovating new ways to reach audiences traditional targeting may miss.

Alliant is constantly asking how we can be ahead of where our clients need to be. In that conversation, DataHub Members are our most valuable resource. By the time you read this, you should have received a new Member Survey from us. We hope you will make time to provide us with your insights on how Alliant can continue to support your success.

Wishing you Continued Good Health,

JoAnne Monfradi Dunn
President & CEO

ABOUT JOANNE

President & Chief Executive Officer

JoAnne is the founder of Alliant – and the architect of our vision to deliver innovative consumer targeting solutions powered by the aggregated purchase transactions of multiple direct-to-consumer marketers.

A lifetime marketer, JoAnne’s career includes positions at Time Life, The Norman Rockwell Museum, and Mal Dunn Associates. She is a committed advocate for development of comprehensive data governance and security standards, and has a long history of industry service. She is also an expert baker.