What Is First-Party Data and Why Is It Important in 2024?

By Sophie Walker • Last updated: Wednesday Jul 10th, 2024

6 Ways to Collect First-Party Data _ Sources_ examples and collection methods

As third-party cookies become obsolete and privacy regulations tighten, first-party data has emerged as an indispensable asset for online brands.

These industry shifts are fundamentally reshaping eCommerce operations, presenting challenges and opportunities for retailers who rely on third-party data advertising to reach wider audiences. 

In this article, we’ll discuss the importance of first-party data in 2024 and how you can use it to enhance your long-term marketing strategies.

Cookies eBook

What is first-party data?

First-party data refers to the information collected directly from your shoppers as they interact with your site, app or marketing channels. 

As an online retailer, you already have access to a large amount of this information. 

To compile it into an actionable database, we recommend that you begin to gather data from your:  

  • Website interactions 
  • Purchase history 
  • Email subscriptions 
  • On-site behaviour 

Leveraging these sources will give you an accurate and detailed understanding of your customers. 

Allowing you to go on to create genuinely relevant and highly targeted marketing campaigns.

How does first-party data differ from second and third-party data?

Customer data typically falls into three categories: first-party, second-party, and third-party data.

Here are the definitions for each data type:

  • First-party data is collected compliantly from your customer’s interactions, giving you control over this data. 
  • Second-party data is another company’s first-party data. Retailers access this through direct relationships and data-sharing arrangements. 
  • Third-party data is collected by entities with no relationship to the customer and is aggregated across sources, this can often lead to broad insights and inconsistency across your data set. 

Third and second-party data collection methods are often viewed as intrusive and non-transparent. In contrast to this, first-party data is collected directly from your customers, voluntarily and without the need for external parties or invasive tracking methods.

This is why first-party data is becoming a crucial resource for eCommerce marketing and retargeting efforts in 2024 and beyond. 

Suggested reading: To discover how you can maximise your data collection, read our article ‘6 Ways to Collect First-Party Data: Sources, Examples and Collection Methods’.

The changing digital landscape

In recent years, the impending phase-out of third-party cookies has significantly reshaped the digital landscape.

Off the back of high-profile data breaches and misuse, modern shoppers now demand transparent data practices

This has led to the upcoming removal of third-party cookies, demonstrating Google’s continued commitment towards customer privacy – prompting retailers across the industry to re-evaluate their data usage.

Consequently, many small and medium-sized brands have realised they heavily rely on third-party cookies for their day-to-day marketing efforts. Most notably as a means to: 

  • Collate data such as customer preferences and browsing activity across multiple websites. 
  • Retarget and advertise to users across sites.
  • Gain insight and collect information on broader audiences.

As the industry shifts towards prioritising compliant data practices, relying on these methods is no longer viable.

Businesses must adapt by leveraging first-party data and adopting transparent data collection techniques to meet evolving consumer expectations and regulatory requirements. 

Suggested reading: Looking to get ahead of the evolving digital landscape? Read our article, ‘How to Prepare for the Third-Party Cookie Phase-Out’.

Benefits of first-party data in 2024

First-party data will play an essential role in mitigating the negative impact of the third-party cookie phase-out on retailers.

Let’s delve into the benefits and opportunities first-party data can provide for your brand.

1. Increased accuracy and relevancy

First-party data offers an increase in reliability and relevancy as it comes directly from genuine user interactions.

This eliminates any room for potential errors or discrepancies through third-party data collection methods. 

As you can identify and monitor which first-party metrics you want to prioritise going forward, you can ensure that the data collected is both relevant and beneficial to your overall business objectives. 

The reliability and accuracy of first-party data will play a crucial role in improving your business performance and shaping your marketing campaigns for the future. 

2. Enhanced personalisation

First-party data presents a valuable opportunity for you to personalise your customer experiences and create targeted marketing campaigns. 

We recommend using your first-party data to: 

  • Enhance on-site personalisation: Deploy dynamic Recommendation units across multiple touchpoints on-site. Using your customer’s behavioural data, you can connect shoppers to their perfect purchase and increase your average order values. 
  • Retarget abandoned browsers: Integrate Recommendations into your Email & Messaging campaigns to draw lost shoppers back into the buying funnel. Send targeted email sequences based on individual on-site behaviour to encourage conversions and retention. 

Using customer data in this way allows you to take a personalised, holistic approach across multiple marketing channels. The level of hyper-personalisation this approach unlocks will help to drive effortless sales and deliver marketing experiences that resonate on a deeper level.

3.  Comprehensive customer insights

Your first-party data serves as a bank of comprehensive insights into your audience’s wants and needs. 

To create a deep understanding of your customers, you might look specifically at their: 

  • Preferences 
  • On-site behaviours and interactions
  • Past purchases and buying analytics 
  • Demographic information 
  • Engagement metrics 

These insights can be used to identify behavioural patterns, popular products, and emerging trends.

Using this information to fuel your future marketing campaigns will ultimately help you to improve your business outcomes.

4. Prioritisation of compliance and trust

First-party data makes it easy for retailers to follow privacy laws and remain compliant.

This is especially relevant as brands navigate the new era without third-party cookies. 

Adopting transparency will make your shoppers feel more informed about the data collection process and give them greater control over the information they choose to share with your brand. 

In return, this openness encourages users to feel comfortable with sharing additional information such as their email or mobile number. 

You can also expect to foster long-term loyalty, as your customers feel secure and safe shopping on your site. 

Overall, focussing on first-party data and compliant practices will help establish trust and loyalty amongst your audiences, ultimately driving growth for your brand.

What you can do: Salesfire understands the importance of first-party data in eCommerce strategies. 

For example, using Salesfire’s data capture strategy men’s fashion retailer Stuarts London experienced a 159% increase in email sign-ups. 

This allowed them to increase their customer data at an unprecedented scale, expanding their marketing and retargeting opportunities.

Cookies

Futureproof your strategy with first-party data

The value of first-party data is unparalleled in a future without third-party cookies. 

Now is the time for retailers to get ahead of the upcoming changes and futureproof their data strategies.

First-party data not only provides you with insight into your shopper’s purchasing and browsing behaviour but also allows you to better serve your customers with personalised marketing campaigns that secure conversions.

Discover how Salesfire can help you grow your bank of customer first-party data and expand your opportunities for retargeting, email one of our experts at [email protected] or book a free demo of our tools.