Sound the alarm a little.
Marketers at product and services companies fail with first-party data, yet it could be their biggest contributor to growth in the coming year.
Do you know who doesn’t fail at first-party data? Media companies. But I’ll come back to that.
It’s coming on five years since the EU’s GDPR privacy legislation put the proverbial content, marketing, and first-party data soup on the heated stove. Next month is the third anniversary of Google announcing, and subsequently punting many times, the death of the third-party cookie. (It’s currently set to die in 2024.)
But let’s be honest – few know what either means.
Oh, you know these challenges have something to do with privacy, personally identifiable information (PII), and how businesses use that data to optimize their marketing.
But what is anyone doing about it? In 2018 and 2019, most marketing organizations – thinking they should do at least something about visitor data – leaned on their legal and technology teams to help deal with privacy compliance. The conversation went something like this:
Marketing: Help. We need to comply with first-party data acquisition and cookie notices.
Legal: OK, can you identify all the places where we store customer data?
Marketing: Are you kidding me? We don’t even have logins for most of those systems.
Legal: Uh, OK. What about all the cookies we set for tracking and analytics?
Marketing: Hey, tech team, what’s up with all that?
Tech: Theoretically, we could tell you. But that will take A LOT of time.
Legal: Great, here’s what we’ll do. We’ll create a big legal pop-up that says we track you. It also will say that by using any of our sites, the visitor agrees to be tracked, that we may or may not give this data to other people, and that if they want a copy of their data, they have to stuff a physical letter typed on pink notecards into some post office box or something.
Marketing: What happens if they don’t accept? Can we NOT track them?
Tech: Theoretically, we could do that … But that will take A LOT of time.
Legal: Don’t worry; we’ll word it so that it doesn’t matter what they do; we’re covered legally.
And that conclusion is where marketers still stand in 2023. Now, to be clear, I’m not smart enough to know what constitutes legal “consent” and whether you really need it. Nor can I advise whether that should be a pop-up window or a thin banner at the bottom, or even if you should have one (though I have strong opinions about all of them).
Most pop-ups are nonsense. They literally load the page and set (usually) multiple cookies on the user’s browser, and then present the visitor with their “consent form.” In other words, you probably ran afoul of your policy before asking for consent.
But that’s only a small piece of a first-party data approach.
Despite the volume of digital ink spilled in the name of data acquisition, marketers mostly operate as they have for the last decade. First-party data – the data given directly by audiences – sits siloed in different systems like marketing automation, CRM, and custom databases. Separate teams manage it.
Marketers still acquire second-party data – data obtained from partnerships, such as events and webinars. Sure, they signed the I-promise-we-won’t-add-this-to-our-database agreement, but they did it with a wink and a nod. Then, they added the data tagged as “leads” to their email marketing database (which often also has first-party data). And marketers still purchase data streams from third-party providers to “triangulate” or enhance the data they have.
Now, if all that sounds relatively complex, it’s because it is. Marketers don’t know how to improvise in a clever way. Quite the opposite. Because you have goals to meet, content to target, and leads to generate, you’ve literally become the professor from the 1960s sitcom Gilligan’s Island. You’ve built electric generators, sewing machines, and even lie detectors with coconuts and twine. But, somehow, you’ve not thought about building a boat.
You’re still stranded on the island.
Some perceive all the increases in privacy innovation, legislation, and policy make it harder for marketers to do their job. The narrative says these things are designed to protect the public’s safety because businesses can’t be trusted to do it.
But that’s not necessarily true. None of the fundamental activities I mentioned – storing and using first-party data, leveraging second-party data, and even triangulating third-party data – are inherently evil.
In fact, leaning into first-party data acquisition should be a defining, differentiating marketing approach in 2023. It isn’t a conflict. Just take a lesson, once again, from media companies. They have a different approach to data acquisition.
The first-party data challenge placed existential pressure on digital media companies in the last few years. Many stepped up to the challenge. They invested in the people, processes, and technologies to get a better handle on audience-centric services built from the acquired data:
It’s time for you, as marketers, to step up. Strategic management of first-party data is a content, design, and marketing challenge. It is not a legal or technological challenge. Media companies see how they use first-party data as a business investment, not just a way to comply with a law or become more efficient.
In 2023, you can tackle this challenge head-on, and it may provide the leverage for growth in a year where uncertainty abounds.
Taking a different and thoughtful approach to first-party data acquisition should top your data concerns. I’ll leave with these random ideas on how to do that:
If a visitor has to sign up for your blog, then sign up for your email newsletter, then register for your resource center, and then give their email address again to download a second white paper from your resource center, you have a data project to tackle.
Imagine the more powerful insight you could draw if a central dashboard lets you see your audiences tagged with relevant attributes, such as “subscriber,” “lead,” “webinar attendee,” and “customer.”
Too often, marketers default to “identity” when gating a blog, learning library, or some other content. You point every single audience member to the same registration page and ask for their name, email, address, etc.
What if you asked what you really wanted to know? In other words, you weren’t going to treat someone accessing that visionary white paper as a lead. So, why not ask, “Why do you want this white paper?” in the registration form. Their answers will provide more valuable insight than their email address ever could.
Some people claim “zero-party data” is the new gold standard – data shared intentionally by the consumer. But zero-party data isn’t a thing. It’s just first-party data given with a different motivation. Media companies continue to thrive because their business is built upon audiences providing data willingly and trustingly, with the expectation that, in return, they get a valuable experience.
If your continued expectation is to ask for data with the implied expectation that any data given will be used to “sell,” don’t be surprised when the data is inaccurate. Count the number of [email protected] in your database to get an idea of just how prevalent that is.
Only one thing is worse than getting no data – getting inaccurate data.
Most marketers sit on the sidelines as media companies evolve and lament the difficulty of placing paid media bets that work. You continue to rent the markets of others and use third parties to measure yourselves by how successful you make them.
Media companies quickly figured out that content-as-product output can be an extraordinary marketing vehicle to help them become product companies. Some product-forward-leaning companies, like Amazon, Microsoft, Apple, Nike, and others, made this same discovery.
As my good friend and CMI founder Joe Pulizzi says: “Today, the media business model and the product business model are exactly the same.” I would change that only slightly. Neither media nor product companies are in the media business. We’re all in the audience business, and first-party data acts as the engine that powers it.
It’s your story. Tell it well.
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Cover image by Joseph Kalinowski/Content Marketing Institute