First- vs. Third-Party Data: Key Differences for Marketers
by Gwen Hagen, Director, Program Management
Online audiences continue to push for two things: privacy and personalized experiences. But how do you provide unique interactions if you’re limited in your data collection?
Increased regulations and the elimination of third-party cookies have made it trickier.
Building an effective strategy means balancing your first-party data inventory with third-party information that supplements it. Before diving into strategy and implementation, here’s what you need to know about each type and how it’s collected.
What is First-Party Data?
First-party data is the information you gather directly from your customers on channels you own and manage — your website, apps, customer relationship management (CRM) systems, emails, social media platforms and transactions.
Types of first-party data include:
- Website pageviews, clicks and navigation paths
- Social media post comments, likes and shares
- Purchase history
- Subscription details
- Survey/feedback data
- Contact form submissions
- Product and service reviews
- Email open rates and responses
“First-party data is extremely underutilized,” said Gwen Hagen, Director of Program Management at MadAve Marketing Management. “We often see our clients sitting on a gold mine of data that can be leveraged for strategic marketing.”
Because that information is sourced directly from your target audience, it gives you accurate insights into their preferences and buying behaviors. With that information, you can tailor your marketing strategy to provide experiences they want.
What is Third-Party Data?
Third-party data is collected by information aggregators or brokers who sell it to organizations. You don’t own third-party data, and those who accumulate it don’t have a relationship with your target audience.
You can find the following details in third-party data:
- Demographic information like age, gender, occupation and income level
- Online behavior
- Location-based insights
- Transaction history
- Lifestyle data
- Device and browser type
“While first-party data can be used for nurturing, third-party data is better for lead acquisition. It’s great for businesses in growth mode,” Gwen said.
Some of the top third-party data companies include NielsenIQ, TransUnion, Crunchbase and ZoomInfo. Those businesses cast wide nets, so using third-party information can help you scale your marketing efforts across channels.
Differences Between the Two
| Factor | First-Party Data | Third-Party Data |
| Accuracy | Sourced directly from your own channels, so you can trust it. | Aggregated by outside brokers — review it carefully for precision. |
| Exclusivity | Unique to your company; no other business has access to it. | Often sold to multiple agencies, so you may be competing for the same audience without knowing it. |
| Cost | Free to collect since you own it, though you may invest in CRMs and other platforms to gather it. | Typically comes with licensing and per-use fees. |
| Scale | Limited to the size of your own audience. | Extends your reach across thousands of sites and apps. |
| Privacy | Consent is explicit – customers knowingly submit their information. | Users aren’t always aware their information has been shared, so use it carefully. |
Building a First-Party Data Marketing Strategy
You can integrate both approaches, but it’s important to build your foundation on first-party data.
“I always recommend using first-party data before investing in third-party data,” Gwen said. “You can nurture existing customers without spending money on new leads.”
Here’s how to start:
Audit your data: Take a look at the data you already have. You may have customer information scattered across multiple channels that can help you create a comprehensive picture of each member of your target audience.
Create value exchanges: Be transparent about the information you wish to collect from customers and only ask for what you need. Incentivize users to complete forms and provide input by offering them value through discounts, promotions and improved user experiences.
Centralize your information: Keeping all your data in a single CRM system makes it easy to segment your audience and provide them with content based on their interests and position in the buying cycle.
Turn Your Marketing Data into Actionable Insights
Navigating data collection and integrating it into an effective marketing strategy takes time – something you may not have if you’re trying to run a business. That’s where MadAve Marketing Management comes in. Our team of marketing managers and directors will review your goals, outline the steps to achieve them and put the plan into action. Learn about our services and reach out to schedule a meeting.
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