Topic: Zero Party Data
Original Article: MarTech Series
The area for how companies distribute content to consumers in addition to the way they acquire consent to use personal data is evolving before our eyes. Apple, manufacturer of the iPhone and iPad, recently announced significant changes to the way it will handle privacy for users. Specifically, they plan to give consumers more control over privacy settings that will enable them to have more say over what personal data is provided to companies.
This has unsurprisingly left executives at Facebook angry and say the changes will limit and significantly diminish the ability to deliver highly-targeted content and ads to users – a move that will surely damage advertising revenue from the many businesses that depend on targeted content, offers, and messages for a more personalized and effective experience.
In addition, Google, which has established itself as the number-one digital advertising platform through its search engine, also recently made the announcement that it will alter the way it delivers personalized content and ads. The tech giant proposes their own new set of technologies that they claim will allow Google to track users personally, but in a respectful way in regards to their privacy. Google says they can do this through tools that assure to group consumers into interest groups on their devices, and never send their browsing history and information to a server.
There’s a lot at stake, which includes the way companies use algorithms and technology to track individual users. Take Google for instance, if they enhance their privacy by masking customer data, businesses must then go through Google to purchase ads, which ultimately means gaining access to targeting data to send those messages to a designated user base.
Propelled by Big Data, these online ads have previously helped companies target people with characteristics of someone to whom the content and promotions are likely to be of interest. Big Data is the process of buying data from a third-party provider, collecting the online activity, purchase history, social media content and more to identify people that are most-likely interested in the promotions a company has to offer.
However, one essential issue is that companies are making assumptions based on this data, and many times the estimations made are based on either outdated or inaccurate data – combined with the fact that most consumers know this is happening and see it as “creepy”. For instance, when a person Googles a certain phrase or topic, targeted digital ads about the very same product are produced and targeted to them.
Due to this, Big Data is falling out of favor with many because in so many instances it’s inaccurate and also lacks customer transparency and control. On the other hand, companies like Apple and Google have goals of keeping customer data more private while continuing to deliver that customized internet experience to users.
A war has been waging for awhile about a person’s right to data privacy. What’s more is that there’s also a personalization/privacy conundrum that exists. This means that consumers want their data to be private and safe while at the same time want the content directed at them to be curated based on their interests on a daily basis. Finding a balance between the two is of utmost importance as we live in a digital world and many people can feel overwhelmed by the amount of messages they receive in a day.
With all that said, there has to be a fundamental change on how companies collect and utilize customer data. As discussed, big data isn’t always accurate and often times feels like an invasion of privacy to consumers, which ultimately breeds mistrust.
Companies are now embracing the collection of zero-party data to bolster customer trust. Zero-party data is information a customer willingly shares with a company or brand they trust. The information can include anything from preferences, feedback, and profile information to interests, consent, and purchase intentions.
This is a step in the right direction for consumers to be in better control of their data. Benefits of utilizing zero-party data include:
The key to all of this is that businesses in every industry, no matter their size or location, have to change the way they interact and engage with their customers. Trust is needed from both current customers and prospects so they’re willing to share zero-party data with brands.
Creating this trust allows businesses to gain access to the data they need to better engage with their customers on their terms while also providing enhanced value in return, such as elevated customer service and personalized customer experiences. Providing customers effortless access to update and edit their data keeps the data up-to-date while also building trust, which leads to a mutually beneficial relationship.