Types of Party Data: The Heart of Marketing You Need to Know.

In the world where we step into the age of data. No matter what you do, you need to rely on data, especially data-driven marketing in the marketing industry. Many businesses started to employ personalised marketing to learn about their customers before the competitors and sell what best meets the needs of the customers.

However, before you start data-driven marketing, you should learn about each type of party data first. Party data has 4 kinds: zero-party data, first-party data, second-party data, and third-party data. Today, this article will get you through each type of party data and how to implement them in your business.

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What Are the Types of Party Data?

The 4 aforementioned types of party data are basically different both in terms of quality and quantity as follows:

What Is Zero-Party Data?

Zero-party data refers to the data that your customers intentionally inform their interests directly to you, which is the consent after you sincerely inform them of what benefits they will receive. To collect zero-party data, you can use the mechanic or tool via various digital channels. For example:

  • Creating a poll for customers to vote e.g. showing different kinds of food pictures on which customers click on their favourite one
  • Making a quiz to ask the customers what product category they specifically like.
  • Sending out a questionnaire for customers to fill out to win prizes

Also, you can gather zero-party data via other offline channels as well such as:

  • Call centre staff inquiring of customers directly
  • Asking customers at department stores, offering membership applications, and handing out the questionnaires

How Does Zero-Party Data Matter?

It has been years since numerous companies make use of “cookies” to track website traffic, analyse online behaviour, perform personalised marketing on various channels, as well as deliver ads to the right target group. Nevertheless, there have been many situations today including:

  • People’s awareness of privacy. According to a study from Pew Research, 41% of American users regularly delete their cookies, and 30% install the Adblocker tool.
  • Europe’s General Data Protection Regulation (GDPR) doesn’t ban the use of cookies but requires a clearly stated purpose for collecting data.
  • European Data Protection Board’s (EDPB) Guidelines stated that cookie dialogue will have no pre-ticked checkboxes for cookie consent and that users scrolling the screen or clicking to view other web pages is not considered consent either.
  • Google has announced it would deprecate support for third-party cookies by 2022.
  • iOS14 and Apple Tracking Transparency (ATT) can block cookie tracking.

Therefore, tracking your customers via cookies is no longer doable. As a result, collecting data directly from the customer (zero-party data) is a great essential tool for segmentation or personalised marketing.

What Is First-Party Data?

First-party data refers to the data possessed by the organisation, business, or the data user themselves. It can be the data from the organisation’s CRM like names, addresses, phone numbers, or data collected from various channels such as website visitors or application users. The first-party data provide the information that businesses can use as most data belong to those who interact with them–whether they are customers, those who are interested, or those who have already started to know your products and services. Many businesses, therefore, use first-party data to develop their personalisation or create content that is specific to the target group, as well as analyse the audience marketing behaviour–what problem they are facing and what they need to fix that issue. Most importantly, in compliance with GDPR or PDPA, you need to ask for consent from your customers on how you will implement the collected data.

First-party data benefits you with a more accurate picture of your target group. If you have gathered good enough data, you will know from each customer’s purchase history, their behaviour when visiting the website or using the application, to their interactions with brands in the past.

However, the limitation of first-party data compared with zero-party data is the less quantity of information. It reaches out to fewer target groups whereas zero-party data is gathered from a broader audience. First-party data only provide you with the information of those who used to interact with you, so it takes time to create or collect new data as it can’t be instantly expanded.

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What Is Second-Party Data?

To simplify, second-party data is first-party data owned by someone else. Therefore, prior to accessing second-party data, you need to ask for permission or make an agreement to cooperate in exchanging information with each other. Second-party data will help you overcome the limitation of first-party data quantity and expand the target audience or data scope more easily. Especially if you are doing personalised marketing, the more you need to have second-party data from outside sources to learn about your customers as well as understand the context of the customers better than just having first-party data.

With all being said, the limitation of second-party data is that the 2 companies that will exchange the data need to highly trust each other and be sure that there will be no conflict of interest between the 2 parties or anyone involved in sharing the data. Another point is that you may not be able to access or use second-party data as fully as your own first-party data. Thus, you can’t control the quality of second-party data as the data don’t belong to you.

What Is Third-Party Data?

Third-party data refers to information that third parties collect from various channels and resell to you. The data range from general demographic to behaviour data. Mostly, the data aren’t directly gathered from the target group, so third-party data usually lack much quality and accuracy compared to the first 3 types of party data above. Even the behavioural data isn’t current nor clearly provided by the data owner.

However, as third-party data has been continuously gathered for a long time–both unintentionally and intentionally–such as customer interests, searching behaviour or website visiting, favourite hobby, etc., the abundance of data is scattered. It depends on which businesses can bring the data together to obtain compelling and quality insights.

As the information is collected by third parties, another limitation of third-party data is that you can’t track at all whether the source of data is reliable enough to be implemented. Moreover, the data aggregators don’t gather the data and resell them solely to you. They also resell the same data to other businesses that are interested in the information and ready to pay. That means your competitors can buy the same data as well.



Now you can see that each type of party data has different pros and cons. What makes your business most effective is bringing the advantages of each party data together. To clarify, whether it is personalised marketing or data-driven business, zero-party data, first-party data, second-party data, and third-party data are all required to increase the data quality and accuracy, as well as extend the data scale as much as possible.

Also, what can’t be forgotten is obtaining consent from customers and letting them know how you will use the information for further benefits. Nowadays, we are living in the age where everyone values privacy more than ever, so you need to be careful of using data without customer consent as it can be against PDPA.

If gathering data seems complicated and you don’t have time to focus on other parts of your business, Primal Digital Agency is here to help any entrepreneur run their business successfully. Contact us to consult our marketing experts today.