Knowing where the data comes from is the key

Knowing where the data comes from is key

According to a study carried out by Verizon Media and IPG, 87 per cent of people are wary of the strategies companies use to obtain their data, as well as the way in which it is used. Your business may well be facing this issue. In any case, in a world where data is everywhere, it is important for consumers to be aware of the source of the data you collect.

It is useful to know that there are different ‘types’ of data. Indeed, in marketing and data jargon, we distinguish between three categories of data.

What are the different types of data?

1. ‘Zero-party’ data

Firstly, so-called ‘zero-party’ data. This is data collected directly from the source, i.e. from the consumer. It is data that is shared voluntarily by the consumer. To collect this type of data, it is obviously necessary to comply with all applicable regulations, in particular those set out in the well-known General Data Protection Regulation (GDPR). We are thinking in particular of the consumer’s consent, the transparent information provided to them, as well as their right to access all information concerning them (Article 15 of the GDPR), to rectify it (Article 16 of the GDPR) or even to withdraw consent (Article 17 of the GDPR). These various rights must be implemented in a way that is simple and understandable to the average consumer.

2. ‘First-party’ data

Then there is what is known as ‘first-party’ data, which is collected via web browsers. This is generally mandatory information that the consumer must provide in order to complete a purchase or access a service. This data is generally known to the public, but this is not always the case. It is data that is collected, in particular, via cookies. It is therefore important for businesses to have a transparent cookies policy and to allow anyone to opt out of cookies that are not strictly necessary for browsing. The obligation to obtain free and informed consent therefore rests with the company collecting the data.

3. ‘Third-party’ data

Finally, there is a category of data known as ‘third-party’ data. This refers to all data collected and processed via intermediaries and data processors. Most of this data is segmented, anonymised and purchased from third-party companies that are not the original data collectors. It is this data that is most often used by marketers for advertising or targeting purposes. With this category of data, the end consumer is often completely unaware that their data – for which they have no doubt given initial consent – is being shared with a number of companies whose existence they may not even be aware of. It is therefore essential, as a business, to provide sufficiently clear information about which parties the collected data will be shared with.

It was this issue that was highlighted by the ‘Grindr’ case, in which the Norwegian data protection authority imposed a record fine of €9.6 million. In this case, a dating app shared a certain amount of data concerning its users with third parties, without any legal basis.

A question of transparency

For businesses, the key challenge here is to be as transparent as possible about how the data was collected and the purpose for which it is being used. Businesses will need to adapt their strategy by building closer relationships with their customers, as ‘first-party’ data is crucial. To do this, marketers must learn to understand their audience better and, above all, to consolidate and make good use of the data they already possess. It is no longer the quantity of data that counts; on the contrary, it is quality that takes precedence. As a result, businesses will need to demonstrate agility and focus their efforts on a new data collection strategy. Today’s – and tomorrow’s – consumers value personalisation, but not at the expense of their privacy.

As for consumers, we can expect them to continue sharing their data, provided they feel they have greater control over it. Offering consumers a transparent experience will, at the same time, increase their brand loyalty. This involves, in particular, a privacy policy that is clear and understandable to the consumer. It is therefore a win-win situation: beneficial for building consumer trust, but also for the company itself.

Indeed, not knowing where data comes from – let alone how it was collected – can pose a legal risk to the company. On the one hand, the company may be in breach of the GDPR and, on the other, may face reputational risks should the data subjects lodge a complaint. By focusing on ‘zero-party’ or ‘first-party’ data, marketers can ensure compliance with the GDPR, as they are the ones who have collected the data. By adding a simple opt-in to an online form, for example, consent is easily obtained and that’s all there is to it. On this basis, the marketer can send consistent and personalised communications.

In this regard, we strongly advise you to turn to ‘zero-party’ data. Actito’s recent partnership with Qualifio perfectly meets this need.

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