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2024 is the year businesses must understand 1st Party Data

In 2024, the new systems for tracking and using first-party data correctly will be a game-changer for businesses who sell things online and want to be ahead of their competition.

Take Shopify brands as a good example. The accurate transmission of purchase conversion data to advertising accounts, such as TikTok or Meta, will be the deciding factor in whether these ad systems can algorithmically learn. Good data will power good ads, and lead to sales. Any interference or blocking of this data will have a direct impact on the companies’ bottom line. 

Data

Types of data

So what’s the key difference here? Well, you collect first-party data directly from customers or website visitors using your website. This includes contact details, purchase history and browsing behaviour. This data serves as a crucial navigational tool for understanding effective strategies, identifying areas for improvement, and successfully attracting more buyers across various online platforms. It represents your site, your data, and your ads.

In contrast to third-party data, first-party data is obtained with user consent, making it more reliable. It remains confined within the store/sites and ad operations, powering online campaigns and facilitating the effective retargeting of users.

Second-party data is often purchased or shared from a different company, not directly collected. Third-party data typically refers to audiences collected from browser pixels. These pixels are often on sites which are not controlled by the entity in question at all.  

Considering this, first-party data emerges as the kind of data collection most users find palatable. The idea of other companies you are not even interacting with taking your data and marketing to you without your consent can feel a bit odd. Essentially, they monetise your data without your awareness or agreement.

Fortunately, most lawmakers share the sentiment that this practice is inappropriate, prompting a shift in the world. Regulatory bodies are keenly focused on addressing third-party data to curb non-consensual data sharing.

What’s next for businesses?

All of this explains the increasing difficulty in capturing third-party data through cookies. Devices are blocking them, laws are being passed to halt their effectiveness, and with this, first-party data is becoming more and more essential for a deeper understanding of customer preferences and highly targeted marketing campaigns. This is why those who understand it will win out over others who do not adapt to this changing landscape.

To collect this data, businessese should focus on server-side tracking, compliant cookie banners and enabling server based analytics collectors. This approach ensures the collection of accurate customer data all through a verified domain that can prove the exchanges of data are indeed first-party. This also helps where domain verification is now commonplace in the major ad account systems. 

Getting this right means correct data, better ads, increased revenue and better marketing attribution. Leveraging first-party data is crucial for future-proofing businesses and driving more value from loyal customers. 

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