Marketing with First-Party Data: A Guide for Small Businesses

If you’re a small business owner or entrepreneur, you may have noticed a drastic change in the digital marketing landscape. With the release of IOS 14 in 2020, third-party users’ data sources like cookies have become increasingly difficult to utilize for digital advertising purposes. This might come as a surprise to some, but it’s actually a significant shift that has impacted marketing functions across the board over the last few years. So what are reliable strategies small businesses can use to attract their target audiences in a third-party “cookie-less world”? Let’s take a closer look at the reasons behind this change and explore how you can leverage first-party data to continue reaching your target audience.

 

The fall of third-party cookies

In 2020, Apple released their IOS 14 update, which included a significant change to the way third-party data sources could be utilized. Apple made the decision to block third-party cookies by default, meaning that iPhone users would have to opt-in to sharing their data with third-party advertisers. This decision was made in response to growing concerns around privacy and data protection, and it has had a significant impact on digital marketing strategies.

Prior to this change, third-party cookies were a commonly used tool for digital advertisers. These cookies allow advertisers to track users’ online behavior across multiple websites, which can then be used to create targeted advertising campaigns. However, concerns around data privacy and security grew over the years, with many users expressing discomfort over the amount of personal data being collected and used without their consent.

Apple’s decision to block third-party cookies forced marketers to find new ways to reach their target audiences. Without access to third-party data, businesses must rely on their own first-party data to create effective marketing campaigns. This has led to a renewed focus on building strong relationships with customers and collecting data directly from them.

 

What is first-party data and why is it important?

So what exactly is first-party data, and how can you use it to your advantage? First-party data is visitor or customer data that a company collects directly from its customers, such as email addresses, purchase history, a social media pixel, and website activity. This data is typically more reliable and accurate than third-party data, as it comes directly from the source. It is also more readily available because it can be stored on a private customer data platform or CRM. By utilizing first-party data, small businesses can better understand their target audience’s behavior patterns, preferences, and needs. Using this information properly, you can increase user engagement and website conversion rates while realizing cost savings in your ad campaigns at the same time.

 

Challenges marketers face when using first-party data

The power of third-party data came from the utter mass of its source, which was everywhere. The companies who yielded this information also had seemingly endless resources to crunch this data for us and deliver results in extremely useful ways. With first-party data entrepreneurs are now dealing with limited lower quality data they don’t always know what to do with or how to keep secure.

 

Four challenges to handling first-party data

1. Limited Data: First-party data is data collected directly from your customers. However, if your customer base is small or if you don’t collect enough data, you may find it challenging to create effective campaigns. The more data you have, the better you can understand your target audience and create personalized campaigns.

2. Quality of Data: Even if you have a large amount of data, the quality of the data might not always be reliable. Inaccurate, outdated, or incomplete data can lead to ineffective campaigns, wasted resources, and poor customer experiences. It is essential to ensure that the data collected is accurate, relevant, and up-to-date.

3. Lack of Expertise: Utilizing first-party data requires a certain level of expertise in data analysis, segmentation, and personalization. Small businesses might not have a dedicated team or the expertise to analyze data and create effective campaigns. As a result, they might not be able to extract the most value out of their first-party data.

4. Privacy Concerns: Collecting first-party data can raise concerns about privacy violations. Customers may hesitate to share their personal data, and businesses need to be transparent about how they collect and use data. As regulations become more stringent, businesses need to ensure that they comply with data privacy laws.

 

Best practices for collecting and utilizing first-party data for marketing purposes?

Even with the challenges with managing first-party data, small businesses can leverage it in very profitable ways. The first secret is to successfully collect this data. Here are some best practices for collecting and utilizing first-party data for marketing purposes.

1. Offer value in exchange for data: To collect first-party data, you need to incentivize your customers and website visitors to share their information with you. Offer something of value, such as a discount or exclusive content, in exchange for their email address or other personal information.

2. Use opt-in forms: Instead of forcing website visitors to share their data, use opt-in forms that allow them to choose whether or not to provide their information. This will help build trust with your audience and ensure that you are only collecting data from those who are truly interested in your brand.

3. Segment your audience: Once you have collected first-party data, it’s important to segment your audience based on their interests and behaviors. This will allow you to personalize your marketing messages and provide a more personalized experience for your customers.
4. Be transparent about data collection: It’s important to be transparent about how you collect and use customer data. Let your customers know what data you are collecting and how you are using it. This will help build trust with your audience and ensure that they are more willing to share their information with you.

5. Keep data secure: Data privacy is a major concern, and as a business owner, it’s your responsibility to keep your customers’ data safe and secure. Implement proper security measures and ensure that your data handling processes comply with data privacy laws.

 

The best places to collect first-party data

First-party data isn’t going to just fall into your lap like third-party data used to. Here are three easy places to look for the most valuable information you need for your marketing.

1. Analyze your website and social media analytics: Your website and social media analytics can provide valuable data about your audience’s behavior, interests, and preferences. By analyzing this data, you can identify patterns and trends that can help you understand your audience better and identify new opportunities for engagement.

2. Survey your existing customers: Conducting surveys among your existing customers can help you gather valuable insights about their needs, expectations, and pain points. By understanding their feedback, you can identify new opportunities to improve your products, services, and customer experience.

3. Use CRM data: Your customer relationship management (CRM) data holds a wealth of information about your customers, such as their purchase history, preferences, and interests. By analyzing this data, you can identify new opportunities to cross-sell or upsell your products and services.

 

Where to use first-party data for marketing

Once you have collected and segmented your first-party data, it’s time to put it to use in your marketing strategy. By understanding their interests, preferences, and pain points, you can create marketing pieces that speak directly to them and address their needs. Here are a few ways you can use first-party data to attract and engage your target audience.

● Content Marketing: Create targeted and personalized content for your audience. This will help establish your brand as a thought leader in your industry and build a deeper relationship with your audience.

● Social media marketing: Create targeted social media posts and ads that speak directly to your audience. This will help increase your brand awareness and drive more traffic to your website.

● Personalize your emails: Email marketing remains one of the most effective ways to reach your audience, and with first-party data, you can make your emails more personalized and relevant. Use customer data to segment your email list and create targeted email campaigns that appeal to each segment’s interests and needs.

● Customized landing pages: Customized landing pages can help increase conversions by providing a tailored experience for each visitor. By understanding their interests, preferences, and pain points, you can create content that speaks directly to them and increase conversion rates.

● Retargeting ads: Retargeting ads are a powerful way to increase conversion rates when targeting audiences that have previously interacted with your brand. By using first-party data, you can create highly targeted ads that appeal to prospects’ interests and behaviors, increasing the chances of conversion.

● Video content: This is a great way to engage your audience and build brand awareness. Create videos that speak directly to your audience’s interests and preferences. For example, if you sell beauty products, you can create how-to videos that show your products in action and offer tips and tricks for achieving certain looks. This will help establish your brand as an authority in your industry and increase engagement with your audience.

In short, when used correctly, first-party data can be just as powerful as third-party data without the personal information security concerns. When used with a secured data management platform software for data collection like HubSpot or Buzzhub for example, you can analyze real-time information to make real-time decisions for immediate revenue uplift. But it’s not all candy and roses when dealing with first-party data.

 

The time to collect is now

In a world without third-party data, collecting, analyzing, and using first-party data has become vital for small businesses to succeed in today’s marketing landscape. By collecting data through website and social media analytics, surveys, and CRM data, you can segment your audience and create personalized marketing messages that resonate with your target audience. By being transparent about data collection and ensuring data privacy, you can build trust with your audience and create long-lasting relationships. By using first-party data effectively, you can level the playing field against larger competitors and drive growth in a rapidly changing digital landscape.

I hope you found this to be informative. Let me know if you have any questions below.