First-party data – data collected directly from customers – is worth its weight in gold.
Subscription businesses are unique in that the business model, by its very nature, gathers this valuable data to build an initial profile and, ultimately, nurture lasting relationships over time.
Of course, regulatory requirements must be followed, but with the appropriate consent, businesses can consider customer behaviors to deliver an intuitive, personalized advertising and shopping experience.
And by delivering a personalized customer experience that relies on the responsible use of first-party customer data, brands ensure loyalty and customer retention.
First, however, comes the foundation. Having the technical capability to collect and integrate that data over time requires a strong infrastructure and process for how data is collected, cleaned, governed and used to inform marketing and advertising strategies.
Building a solid foundation
We’ve all heard of businesses struggling with lakes of data and raindrops of insight. In general, data activation requires:
- Stakeholder alignment that agrees on what first-party data is collected, how it is used and which compliance guardrails are in place for all locations
- Standardization of that data to establish clear definitions of what you’re collecting
- Consistent naming conventions and context to maintain data integrity during interpretation
Only then can brands validate subscription data to use the insights gained for marketing and advertising strategies.
One more piece of advice: ensure that first-party data is consistent across all channels to prevent a disjointed customer experience. When a data value changes in one place, it must be reflected in other locations. And communicate any and all data policies to subscribers early – before they register for your product or service.
The growing demand for omnichannel experiences gives businesses a more comprehensive view of customer behaviors. The customer experience should be consistent and transparent regardless of their point of entry.
The value of being known
With effective insight into first-party data, brands can begin to identify customer behaviors and preferences that align with business goals.
From there, they can tailor customer experiences and deliver more relevant ads, including:
1) Targeted marketing and advertising campaigns: Provide timely, relevant and compelling advertisements to customers and prospects for impressive conversion rates.
2) A/B ad testing: Develop tests for different customer segments or cohorts based on demographics, shopping behaviors or buying habits. Look at transactional information, such as purchases, purchase histories and average order value, to find emerging trends.
3) Targeted retention ads: Develop targeted ad sets to those customers identified as “at risk” and provide unique offers, add-ons or promotions.
4) Competitive advertisements: Meet – and beat – competitive offers through targeted, timely ad placement and messaging that fends off competition.
5) Personalized promotions: Use data on the effectiveness of past promotions or pricing offers to create retention or win-back offers. Your data should tell you what promotion or pricing offer customers first responded to. This data should be infused in campaigns for customers that have canceled their subscriptions.
6) New prospect segments: First-party data can provide insights into new potential customer groups. Create ad campaigns for initial introductions with specific, customized messages.
A smarter and more secure way to target consumers
There’s no better way to improve customer trust – and boost brand reputation – than handling first-party data respectfully and effectively. First-party data is usually more accurate than third-party data, enabling brands to showcase products or services specifically tailored to the customers’ interests. And, unlike third-party data, first-party data is collected with consent.
A well-supported and implemented advertising campaign can result in increased revenue, higher customer satisfaction and intelligent targeting. This flywheel creates a comprehensive view of the latest customer desires, informs new subscription plans, highlights new promotions to test and enables brands to adapt quickly and successfully.
“Data-Driven Thinking” is written by members of the media community and contains fresh ideas on the digital revolution in media.
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