Personalisation – 2
Zero-party data can improve personalisation which first-party data simply cannot.
Tim Ringel (Clickz): “Zero-party data is information willingly or even proactively shared by consumers with the brand. It might be in the form of surveys, loyalty programs, and preferences. They share it because they perceive value in that sharing… With zero-party data, marketers can now get consumers’ explicit consent to use their data and continue to create individualized experiences without sacrificing privacy. This will build a stronger long-term stronger relationship with consumers. But only if you give them a reason to consent… Once marketers can provide a solid incentive for consumers to willingly share their data, consumers will regain trust and reclaim ownership of their experiences. If you have consistent customers who enjoy your offerings, they are more likely to share their information. Moreover, they’re also more likely to be ambassadors of your brand.”
Zack Hamilton (Fast Company): “Customer-permissioned zero-party data is the catalyst to balancing data acquisition needs. It will also meet the privacy and compliance demands. This new strategy will require organizations to elevate data as an experience. New stakeholders have to get engaged. Cross-functional relationships between marketing, data science, legal, privacy, and compliance will become critical… Zero-party data will enable brands to increase customer trust and loyalty. Hyper-personalization will have positive business impact, including reducing customer acquisition costs (CAC) and increasing average order values (AOV) and customer lifetime value (CLTV).”
Vlad Gozman (Forbes): One of the key benefits of zero-party data is that it’s more trustworthy than third-party data. Because customers share it willingly and know that it’s being used by the brand, they’re more likely to trust the brand with their personal information. Another benefit of zero-party data is that it’s more accurate. Because customers supply it directly, there’s less opportunity for errors or inaccuracies. And finally, zero-party data is more engaging. Brands that use it can create more personalized customer experiences, which leads to higher engagement rates and longer customer lifespans. As consumers become increasingly privacy-aware, brands will need to rely more on zero-party data to create trusted, personalized relationships with their customers. Further, Apple’s move to block cross-app tracking and the trend of browsers toward tracking prevention may make traditional tracking models obsolete.”
The key to unlocking personalisation powered by zero-party data is by leveraging E2L2 (Email 2.0 and Loyalty 2.0). Email 2.0 enables interactivity and Loyalty 2.0 adds micro-incentives (Atomic Rewards) for actions. As I wrote in Loyalty 2.0: How Brands can Tokenise Customer Attention and Data: “Every customer is different. While segmentation is better than mass communication, what’s even better is hyper-personalisation. For this, brands need to aggregate data and then use AI-ML to discern patterns to recommend the next best action to customers. Data today is collected from actions done by customers on the brand’s communications (push messages) and properties (website and app). A trick that marketers have missed is the simplest one: asking customers directly. To make the collection of zero-party data (data volunteered by customers), two building blocks are needed: a hotline to ensure customers are paying attention and not ignoring incoming brand messages, and incentivises which reward them for their data. Data-driven thus means incentive-driven, asking the user to self-reveal both because subsequent interactions will become more targeted and because of the rewards earned in return…While [marketers] can decode actions of individual customers on the website and app, the better approach is to simply ask customers and incentivise their actions (in this case, the data being provided voluntarily). How many brands ask us? How many brands offer us incentives for giving information about ourselves? In this case, the additional benefit is that we will also benefit from the personalisation in the offers that we receive. We want to be shown opportunities that interest us, that speak to us. Revealing ourselves is both an opportunity to earn points and to ensure future communications are targeted for our particular tastes.”
2023 will be the year when personalisation fulfils its true promise and potential – powered by zero-party data collection in interactive and incentivised emails.
