How Retail Brands Connect 1st & 3rd-Party Data To Increase Sales

Brands are past collecting data for the sake of it. It’s about collecting the information you need to better connect with consumers in a way that resonates. Still, for big and small brands alike, audience data is siloed among multiple systems and teams — making it nearly impossible to organize.

To make matters more complicated, some data is collected internally (1st-party data), some is collected externally through 3rd parties, like Google and Facebook (3rd party data) and typically all this data is formatted differently.

So, while you may be sitting on a treasure trove of audience information, it’s most likely difficult to access and even more difficult to analyze. Fortunately, there is a solution: identity resolution. Identity resolution is combining all of the disparate 1st and 3rd-party user data into individual customer profiles, which can then be used to improve marketing campaigns, build loyalty, and increase sales. But how is this achieved?

The data fundamentals

First, let’s go into more detail about how 1st and 3rd-party data can be used. As Adweek states, “first-party data is the customer telling you their story with their actions.” Put another way, it is the data points that tell us who our customers are. Purchases, website visits, survey results, and any information that a customer gives you (like their name, email address, age, gender, etc) all fit in this category, and this is your most important resource.

But, for all its inherent value, 1st-party data should not be solely relied upon in making marketing decisions. As Scott Strickland, CIO of Denn and Marantz states:

"Leveraging 3rd-party data allows us to see who our consumer is. We can see their whole lifecycle. When do they start researching our product? How do they fit in? What other products do they look at and what demographic are they a part of? Using that data helps us build better campaigns and better products."

An important note on 3rd-party data & platforms

It’s no surprise that 3rd-party data enables brands to place targeted ads in places they know their customers go, such as Facebook or Google. Nor is it news that 3rd-party channels are a critical part of the marketing ecosystem. However, when you upload your first-party data to 3rd-party platforms, these companies gain access to granular information about your audience: names, ages, past purchases, and more.

While 3rd-parties don't use that information from the get-go, they can use it once people from your segments interact with campaigns on those channels. The platforms then have your data in their own segments which are, in turn, used by companies (and competitors) who run campaigns via those platforms as well.

Your audience data should be a major competitive differentiator. But, data becomes significantly less valuable when it’s used to inform popular 3rd-party segments. To ensure full ownership of your first-party data while still leveraging the reach of 3rd-party channels, experts recommend running campaigns through data orchestration platforms. Data orchestration ensures that you provide 3rd-party platforms only with audience ID numbers — not granular audience information.

The result? An ability to take control of your first-party data to create valuable information that only your company can fully access to target the right people across all channels and devices.

How data orchestration resolves customer identity

Data orchestration is a data management strategy that uses audience ID and cookie matching to connect the dots on who customers are across all channels, devices, and mediums. With all cross-channel behavioral data in one place, you can create targeted campaigns — from 3rd-party campaigns to triggered emails — for the consumers most likely to buy. Plus, any data collected from these efforts is automatically fed back into your audience segments so can continually refine your audience understanding simply by running campaigns.

So, whether you call it identity resolution or 360 customer views, the end result is the same with data orchestration: an ability to use your data in a way that makes it easier to connect with customers.

The wonders of identity resolution

One of the most common use cases for fully merged audience data is remarketing, or, connecting with customers after they have made initial contact with your brand. Remarketing tactics include triggered emails and of course, retargeting ads. Remarketing outreach has become increasingly important in retail as cart abandonment rates are reaching 74% worldwide.

Now, while you can conduct retargeting campaigns without fully resolving who customers are, having all of your audience data and campaigns in one place (as data orchestration allows) makes it significantly more effective. After all, with true 360 customer views, you can go from asking questions like “how did our abandoned cart triggered email perform?” to “how many people who viewed the abandoned cart email on mobile later purchased via desktop?” Still, this strategy is tried and true for a reason. Let’s dive into a few brands using it well.

The Asics acquisition strategy

With 1st-party data, retailers such as the shoe/activewear company Asics, are sending personalized, triggered emails that incentivize customers into making the purchase they were thinking about. As Salecycle writes, “Asics’ cart abandonment email is a game-changer as it places the most valuable item on display in the email header. It even adds the incentive of free shipping to get the ball rolling. It’s an email campaign that is segmented depending on item type: men’s, kids, or women’s.”

How Perry Ellis Gets Personal

Fashion brand Perry Ellis has also found great success with triggered email remarketing. Instead of blasting out general messaging, they focus on personalized, data-based communication. As Zak Stambor of Digital Commerce states, if a shopper “looks at big and tall items but doesn’t make a purchase, it will place that shopper in [Perry Ellis’s] extended sizes affinity group, which it then uses to power a personalized email marketing program.” And if the customer takes further action, such as placing an item in their shopping cart, the retailer will add this information to their AI-powered data tool and further personalize their communication.

Perry Ellis also constantly updates and personalizes its recommendations, which turns one-time buyers into loyal repeat customers. Linda Sestrick, the retailer’s VP of Ecommerce and Digital Marketing states, “We have such a wide portfolio of products, it doesn’t always make sense just to show someone looking at a shirt other shirts. Drawing on shoppers’ previous interactions, they might be interested in shoes, fragrance, or underwear.” These strategies have led to an 80.6% increase in their online sales in 2017, and they were named No. 46 in the Internet Retailer 2018 Top 1000.

Ebay’s Efficient Remarketing Strategy

If a shopper makes a bid on a product and gets outbid, eBay lets the shopper know through a personalized email that not only has the product, but an updated price and an accurate ticking clock to call the customer to action. Meanwhile, they use 3rd-party data to send targeted ads about that very product on the websites the person is most likely to frequent. If the customer does not win the bid, there will be further remarketing outreach that will make suggestions for similar items on the site. And everything is done in a way to make things easy and relatable to the customer, so they will keep coming back.

Merging 1st and 3rd-party can be an overwhelming experience, but it doesn’t have to be. With data orchestration, data can be used for deeply relevant remarketing campaigns. Lineate can help direct this effort with its own data orchestration solutions. To see how it works, book a free evaluation with our SA team.