Federated organizations ingest overwhelming volumes of data — everything from intelligence on their beneficiaries to transactional information about their donors and supporters. Many federated nonprofits are not swimming in data,…
The internet has reshaped the way companies interact with and market to customers. The data that online users choose to share with their favorite brands can be linked to a variety of devices and profiles.
Organizations that collect and centralize this information can then use it to better understand consumer behaviors, wants, and needs, and deliver more personalized experiences — as well as more relevant campaigns and messaging.
When a user interacts with a website or makes a purchase from a brand, the personal information they choose to share is known as first-party data.
First-party data represents a record of a user’s site interaction, browsing activity, and purchase history. First-party data can also extend to include Personally Identifiable Information (PII) such as names, addresses, and phone numbers, along with information from sources like newsletter signups, donations, or feedback forms.
First-party data serves multiple purposes for organizations looking to gain deeper insights into their past and future customers, clients, supporters, and users. It can be used to establish profiles of individuals, which allows for marketing that is personalized for each particular user — an audience of one. Whereas demographic information helps to segment users based on basic attributes like age, location, sex, family size, and so on, psychographic information is largely based on the preferences that users demonstrate through their online activity. This information has a range of applications, from larger market segmentation to basic ad-targeting. For example, take a customer who regularly purchases shirts from a certain clothing brand. Judging from the first-party data provided, they can be classified as having a preference for the brand in question — making them an ideal audience for ads relevant to that brand. Even if a user surfs product pages of a brand’s website without making a purchase, the company can then advertise to them based on the interests they expressed by clicking on those products.
For years, companies have relied on third-party cookies — i.e., online markers that form a digital bread crumb trail to track unique users across different websites — to deliver personalized experiences and marketing. But policies implemented by Apple, Google, and others are making it increasingly difficult to derive value from these cookies, highlighting the growing importance of first-party customer data. Properly understanding and successfully combining different types of data to establish a full picture of a customer is critical for any organization that wants to deliver more customized experiences and more effective campaigns.