Data-Driven Marketing: What is Second-Party Data and How to Use It?
In the previous article, we have talked about the first-party data and how it can be used for marketing purpose. In this article, we will continue to talk about another type of data: the second-party data.
What is second-party data?
The second-party data is essentially the same as the first-party data except that this data comes from a third-party company. The goal is to buy data from a company to which they belong. This data is therefore similar and can come from sources that are identical to your own first-party data.
In this case, this includes online and offline data such as:
- Activities on the websites of the third-party company;
- Activities on the mobile applications of the third-party company;
- Social media data;
- Customer surveys;
- Polls or comments collected in stores…
In such second-party collaboration, there is no intermediary involved. All the art of second-party data lies in the fact that links of trust and interest must be forged with selected companies. The buyer and seller must agree in advance what will be sold, the price of the transaction, the terms of access and other terms of sale. The vendor may offer data points, audiences, or specific hierarchies to the other company.
This type of win-win partnership is still a relatively new concept and deserves serious consideration in a marketing strategy, as the audiences and data of each complement each other without competing with each other. These are larger, targeted audiences that have a multiplier impact in marketing campaigns.
The examples of collaboration are many: an airline could exchange its data with a hotel group, a brand of running textile could associate with a brand of connected watches…You’ve understood: the possibilities are endless for that union is strength.
The second party data plays an important role in extending and targeting the audience. The possibilities are immense and it is essential to seek out, form and maintain mutually beneficial partnerships.
How can marketers use second-party data wisely?
The partnership you have created with a third party company will be critical to the quality of the data that will be provided to you. This second-party data is particularly interesting because they are complementary to those of the first-party. Data is more accurate and more transparent than if you obtained aggregated data from a variety of sources.
1. Scale your data
Adding similar data to your original data allows you to go faster than a one-sided crop in a smaller audience. Scaling your data with similar data will allow you to scaler the marketing campaigns as well. This means reaching a higher level much faster without compromising on quality.
2. Reaching new prospects
To find new audiences, the second- party data is perfect. To reach a potentially similar audience and attract new customers, nothing is better than relying on audiences that might be sensitive to your products. By creating valuable partnerships with similar customers, you will save time and money.
Let’s take another example to show this advantage. A new brand of vegan cosmetics wants to communicate to increase its notoriety. Collaboration for a data exchange with an organic and vegan food brand would be a win-win partnership for both players.
3. Predicting behaviors
As with first-party data, a careful analysis of the data makes it possible to make predictions about the behavior of prospects during their future visits. By using predictive behaviors, the company can then work to monetize downstream information and more effectively. Because the data is collected on a site that is not yours, you get additional information about what your audience likes and with what it interacts the most.
4. Quality B to B Partnerships
The second-party data party can lead to relationships that go far beyond data exchange. Both companies may realize that they have much more to share because they have similar audiences. These relationships can be beneficial in many ways, including the idea of development and growth.
We will continue to talk about the third-party data in our next article.
