‍What is zero-party data?

The multinational consumer research group Forrester originally coined the term ‘zero-party data’ back in 2018, but you may also hear it referred to as ‘customer-first’ data. They define it as ‘That which a customer intentionally and proactively shares with a brand. It can include preference centre data, purchase intentions, personal context, and how the individual wants the brand to recognise [them].’

If you’re not quite up to speed with how this compares to other data sources, and let’s face it, it can be tricky to get your head around, here’s the low-down:

Zero-party data:

Personal information that a customer shares intentionally and, crucially, willingly with a brand. Usually, this type of data is gathered via interactive online features such as questionnaires, pop-ups or quizzes.

First-party data:

Information that a brand gathers about a customer through certain behaviours on their website or app. This might include click habits, time spent on a particular feature or section, and purchase history.

Second-party data:

First-party data that, with permission, brands can purchase from another company.

Third-party data:

Information collected by companies that don't have a direct relationship with consumers. This data is often gathered from various platforms and helps to build a picture of consumer habits.

Unsurprisingly, beauty brands have emerged as early adopters of zero-party data, leaning into the concept of personalised interactions with their online customers.

Here’s how L’Oréal-owned skincare brand La Roche-Posay has integrated zero-party into their site, according to Ryan Barwick for Morning Brew:

  1. An interactive quiz on La Roche-Posay’s website asks users whether their facial skin type is normal, dry, combination, or oily, and to select their primary facial skin concern (ageing, redness, sun protection, pigmentation, or blemishes).
  2. Users are then given a custom skincare routine based on their answers, made up of suggested La Roche-Posay products.
  3. Users can skip a section that asks for first-party data (email, gender, and date of birth).
  4. The quiz saw conversion rates rise 21%, with an average order value up 134%.

Why is zero-party data a non-negotiable for brands today?

There is still an uneasiness within the marketing community about collecting customer data of any kind. And it’s no wonder, given the widely accepted narrative on the topic and the ever-changing policies leaving us in a near-permanent state of flux. 

But with third-party cookies set to be phased out in 2023 (although as we’ve written before, this doesn’t necessarily signal the death knell for third-party data altogether), we’re seeing a new era of strategies emerging.

Brands are realising that perhaps, for the first time, zero-party data has the potential to provide fully transparent, dare we say ethical data sources that won’t necessarily have the keyboard warriors limbering up their digits. 

As Sai Koppala, CMO of SheerID writes for Forbes, ‘[Brands] should embrace zero-party data to better understand and connect with consumers… Asking questions that consumers want to answer can spark the start of a relationship — not the end, as many marketers have long assumed.’

Here at R360Growth, we believe zero-party data goes hand-in-hand with memorable customer experience, working together to create tailor made experiences for users and, in turn, fostering a positive consumer/brand connection based on trust.

As Koppala continues, ‘Traditionally, marketers have shied away from asking anything of consumers out of fear of turning them away. But if the consumer doesn’t perceive it as friction, neither should you. It’s all about articulating the value the consumer will get by providing the data. As long as the consumer gets value — a better experience, product or offer — they likely won’t see it as friction.’

We think it’s our trusted email partner Klaviyo who says it best, ‘It’s time for marketing as usual to change.’

We’re on board. Who’s with us?

Discover how R360 Growth can fuel sustainable profitability and long-term success with a robust loyalty strategy. Connect with us at hi@r360growth.com or via our online form here.

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