What Is Zero-Party Data?
The term “zero-party data” was first coined by Forrester in reference to “information a customer intentionally and proactively shares with brands.” In the age of data deprecation, brands are increasingly turning to zero-party data to deepen their customer understanding, build strategies that resonate with their target audience, and deliver timely, personalized experiences. It has become a cornerstone of good customer experience design.
The importance of zero-party data will only grow in the years to come. Brands that recognize its value and learn how to apply it to customer experiences now are outpacing the competition. That’s why we’ve put together this resource — to help you understand how zero-party data compares to other types of data and its unique benefits, trusted collection strategies, and best practices for applying zero-party data to deliver more personalized experiences.
Examples of Zero-Party Data
Brands that embrace zero-party data can establish a reciprocal value exchange with customers that becomes a competitive advantage. Here are some common examples of zero-party data to consider in your strategy:
- Contact & Personal Information: Customers provide personal details like birthdays, email addresses and mailing addresses for personalized outreach and messaging.
- Preferences: Customers share and update their interests and how they wish to be engaged in an app or on a website to inform future interactions.
- Opinions: Customers share feedback and perspectives about their experiences with a product or service to inform improvements.
- Wish Lists: Customers share what they are looking for and intentions for browsing to facilitate more tailored offers and recommendations.
Zero-Party Data vs. Other Data Types
There are many different forms of customer data. To harness the power of zero-party data, you must first understand how it differs from other types of customer data:
- Zero-Party: Information customers intentionally share in exchange for more personalized customer experiences.
- First-Party: Information collected about customer preferences and behaviors from interactions and transactions across owned channels — like an app or website — and other marketing channels.
- Second-Party: First-party data collected and shared from another company in a trusted mutual agreement to gather additional customer insights.
- Third-Party: Customer information collected and used by various sources other than those looking to use it.
How Zero-Party Data and First-Party Data Work Together
While zero-party data comes directly from your customers’ input, first-party data is gathered through customer interactions on marketing channels and owned destinations, offering insight into behaviors and engagement patterns. Both of these data types are a gold mine because they come straight from the customer. Combining the two creates a robust customer profile.
For example, a retailer could use zero-party data to qualify customers for an offer, then leverage first-party data about previous purchases to tailor the offer to be most effective. Both types of data are essential for contextualizing experiences and triggering them at just the right moment to increase the likelihood of conversion. More importantly, brands don’t have to rely on third-parties to shape their strategies and accelerate conversions.
Why Is Zero-Party Data Important?
Zero-party data has become a focal point for today’s leading brands. We’re in a new era for data privacy, where consumers are informed and pushing back on companies tracking their every move. According to Pew Research, 81% of U.S. adults report concerns about how companies handle their personal information, and seek more control over what data they share and when they share it.
In response, government agencies worldwide have enforced stricter privacy regulations, making it more challenging for brands to collect new data. In fact, new research from Airship and EMARKETER found that a lack of access to required data is a challenge for 80% of brands. This has placed newfound importance on collecting data directly from customers and often via owned channels, like apps, websites and marketing channels.
Since zero-party data is shared intentionally and proactively, brands can be confident that they are using data in compliance with privacy laws like GDPR and CCPA, while customers don’t have to worry about how their data is used.
How You Can Use Zero-Party Data to Enhance Experiences and Boost Conversions
Zero-party data can be applied to your customer experience strategy in many different ways to enhance your marketing efforts and boost conversions. Here are just a few examples:
Deepen Personalization
Today’s consumers are flooded with marketing messages everywhere they turn and increasingly reject blunt promotions, making it more difficult for brands to capture their audience’s attention and gather the right data to inform decision-making. Gathering zero-party data helps brands unlock the power of personalization to break through the “noise.”
Brands that get personalization right reap the rewards via higher engagement and more conversions. According to Airship research, brands that use zero-party data in their audience targeting see a lift in open rates and purchase frequency. Meanwhile, research from Twilio Segment found that customers spend on average 38% more when their experience is personalized.
Enhance Your Segmentation
Capturing first- and zero-party data on an ongoing basis helps brands optimize segmentation for hyper-personalization and more targeted experiences. You no longer have to rely on guesswork to build and optimize audience segments. This level of granularity empowers brands to get even more targeted with the experiences they deliver to customers, highlighting tailored content, product recommendations and offers.
Improve or Expand Your Products
Zero-party data provides direct insights into what customers want, need and struggle with from your product. Product developers can understand customer pain points and prioritize features that address them. Zero-party data can also be used to gauge customer interest in new product ideas or features before investing in development. This helps validate concepts and avoid wasting resources on products that won’t resonate with the target audience.
Train Your AI Models with Trusted Data
As brands increasingly embrace AI to accelerate content creation, implement experimentation at scale and increase conversions, reliable and accurate data has become an imperative. To effectively harness the value of AI, brands need to train and optimize algorithms with data they can trust to represent their audience now and as preferences and behaviors evolve. This requires a strong base of first- and zero-party data, allowing brands to make data-backed decisions with confidence.
Re-Engage Inactive or Opted-Out Customers
Applying zero-party data to your retargeting efforts ensures customers receive personalized value at every step. You can re-engage customers at risk and keep low-risk customers excited, boosting retention and customer lifetime value. This is also a powerful strategy for driving opt-ins among opted-out customers. Airship research has found that in-app messages that target opted-out customers see 14% of those users convert to opted-in. With personalized in-app messaging, you can encourage them to opt into push notifications, email, SMS and other priority channels to maximize your reach.
How to Collect Zero-Party Data
Consumers are often willing to share their information when approached correctly. Today, they are more likely to provide all 15 types of information Airship asked about year-over-year in order to receive personalized interactions and special incentives from brands they love.
Here are a few trusted methods to inform how to collect zero-party data:
- Preference Centers: Encourage customers to set and update their privacy settings and preferences in a mobile app or your website.
- Loyalty Programs: Offer incentives for sharing preferences during loyalty program sign-ups.
- Personalized Quizzes: Create a fun and engaging quiz for customers to select their preferences and deliver personalized recommendations.
- Surveys: Construct an in-app survey or form to gather customer responses about their experience.
4 Best Practices for Zero-Party Data Collection
Collecting zero-party data doesn’t have to be an intrusive practice. Here are several best practices you can implement now to improve the value provided to and received by your customers.
Focus on Progressive Profiling
You’re unlikely to get a complete customer profile the moment someone first opens your app or website — and that’s okay. Progressive interactions allow you to gather more relevant data with contextual requests that make your intention and respect obvious. This method of building trust enables customers to gain comfort and see the value of sharing more information over time.
Be Transparent About the Data You Collect
Gathering data without a purpose is counterproductive. Be thoughtful about what data you collect (and whether you actually need it), how long you will keep it and how it will flow through your business. Then, develop a timeline for when you actually need that data and communicate clearly how you will use it.
During the onboarding stage, for example, ask for the most essential information upfront — such as opt-in permissions, interests and registration/authentication — to get the customer up and running with your brand without overwhelming them at their first click. Then, proactively show them how sharing information creates a more seamless and unified experience.
Or, if you collect data on product preferences, highlight how those insights will only be used to surface the most relevant offers and personalized recommendations to help the customer find what they need faster.
Sharing your reason for data collection is just as important as the experience itself. Think of communications around your brand destinations as a series of personal invitations. Your customers should know what’s in it for them, including how you will or will not use their data to create better experiences.
Deliver Value Every Step of the Way
Great experiences incentivize customers to share more data as their needs and interests change, which in turn allows brands to serve them better over time. It’s a virtuous feedback loop that delivers increasing value over time when done right. Surveys, preference centers or even clicks on notification buttons are goldmines for marketers looking to collect zero-party data. Build with purpose and then incentivize engagement with personalization, streamlined conveniences and rewards.
Adopt an Experimentation Mindset
Adopting an experimentation mindset allows for continual optimization of zero-party data collection strategies, including the context, value and simplicity with which asks are made. Try out different collection methods (e.g., quizzes, surveys, polls, preference centers) to understand which approaches are most effective at engaging your audience and capturing the right insights. A/B testing questions, incentives and design can help you optimize participation. This keeps the data collection experience engaging for the customer and grows the value and insight over time.
You can also experiment with the ways in which you apply zero-party data to your strategies. Test various personalization tactics (e.g., different types of offers, messaging styles, or communication channels) to determine which approaches are most effective for different customer segments. By analyzing the results of your personalization experiments, you can continuously improve customer experiences and ensure you’re delivering the most relevant and valuable interactions.
Harness the Value of First- and Zero-Party Data with Airship
Airship’s Data Collection and Enrichment solutions are designed to help brands seamlessly sync customer data from their martech stack — external feeds, CDPs, data warehouses and data lakes — to create comprehensive user profiles, improve segmentation, scale personalization and continually refine experiences as consumer preferences and behaviors evolve.
Build Direct Relationships with No-Code App + Web Experiences
Whether it’s through an app, website or marketing channel, direct digital interactions can yield a wealth of first-party data. Airship’s no-code platform empowers non-technical users to create, deploy and adapt high-value experiences to better onboard, activate and understand customers without relying on scarce developer resources.
Collect Zero-Party Data with Airship’s Surveys & Preference Center
Brands can use Airship’s Surveys and Preference Center to ask customers explicitly about their preferences, needs and experience with your brand. For example, after a customer signs up and makes their first purchase, send a survey through push notification, SMS or email. Airship provides the only no-code option for inserting surveys, forms and preference centers — including progressive, multi-screen surveys — embedded directly into web and app experiences. Brands can then use insights and feedback to align future experiences and journeys with brand sentiment and target specific audience segments.
Personalize Messaging Across All Channels
Airship empowers brands to use zero-party data and first-party data to craft highly-targeted messages relating directly to customer interests across all channels — email, SMS, push and even mobile wallet. With the Airship Experience Platform, brands can quickly and easily send messages by combining information from external data feeds to create rich, interactive experiences that help with increasing customer retention and engagement.
Our Real-Time Data Streaming allows brands to connect customer data from Airship to any system in your stack to enrich customer profiles and fuel your personalization strategy. This allows brands to show customers they truly know them everywhere.
Maximize Zero-Party Data Collection with Cross-Channel Orchestration
Airship empowers brands to master cross-channel orchestration to increase the volume of zero-party data collected. A cross-channel strategy exposes customers to your brand across multiple touchpoints, including your website, email, SMS, apps and even mobile wallets. various sources and combine it into a single, unified customer profile. You can then centralize insights from all of these touchpoints to gather a holistic view of customer preferences, interests and needs, enabling more accurate segmentation and personalization.
With Airship’s no-code platform, cross-channel orchestration also empowers marketers to more effectively marry zero-party data with first-party data to optimize experiences. Both types of data are essential for contextualizing experiences and triggering them at just the right moment to increase the likelihood of conversion.
Zero-Party Data in Action with Orange France
Orange, one of the world’s largest telecommunications companies, turned to Airship to improve and scale its customer feedback program across its 10+ mobile apps. Orange’s previous in-app survey delivery method — HTML WebViews — resulted in fragmented experiences and low response rates. By transitioning to Airship’s no-code native Experience Editor, the telecom giant could quickly replicate and deliver its survey within its app.
As a result, Orange now collects as many survey responses in a day as it used to receive in a month — a 30X improvement. The new seamless surveay process offered Orange better data quality and quantity, increasing their confidence to make more informed data-driven decisions and improve customer experiences — generating a +9 point improvement in NPS ratings.
Transform Your Customer Experience Strategy With Zero-Party Data
At the heart of every data point is a customer entrusting you with their personal story. If you’re interested in creating a more fruitful value exchange between your brand and your customers leveraging zero-party data, book a meeting with our team of experts. We can walk you through how you can start scaling your data collection efforts and use those insights to deepen customer relationships, loyalty and conversions.