Companies today have tons of valuable data. And much of that data is data collected by the company through interactions with their audience. This is first-party data. But there is also data collected by external entities that is equally as valuable. It’s called third-party data.
First-party and third-party data both play important, yet slightly different, roles in your data ecosystem. Let’s take a look.
What is first-party data?
First-party data, simply put, is the data your organization collects about your audience. It can include basic demographic information provided via a marketing lead form. Or it could be responses to a customer survey.
First-party data also includes data such as how many times a user visited your website, how long they’ve stayed, and which content they’ve downloaded. Customer purchase data as well as the social media profiles that follow your company also fall into the bucket of first-party data.
First-party data is critical for many reasons. It helps your marketing team retarget users who are consistently visiting your site. It informs your sales team of potential cross-sell and upsell opportunities. And it can alert your support team when a customer is struggling.
What is third-party data?
Third-party data, on the other hand, is data collected by an organization outside of your own, often focused on demographic, firmographic, and behavioral information. It includes publicly-available information, data that an organization collects on its own site and sells, and data that a company aggregates from numerous sources, processes, and sells.
Examples of third-party data include:
Address data from the United States Postal Service
Demographic data from the US Census
Intent data based on user behavior on sites other than your own
Third-party data is important because it helps organizations to expand the value of their existing, first-party data set either by adding to it or by enriching it. As well, many companies today also recognize that their first-party data is incomplete and incorrect, and that external sources, such as address data from the USPS, are more accurate than what their analysts – or their customers – enter themselves.
The value of first-party and third-party data, together
For years, companies have relied on their first-party data to make data-driven decisions. It powers analytics, drives marketing campaigns, reveals new revenue opportunities, and helps to mitigate risks. But today, companies are realizing two things: 1) much of their first-party data has poor data quality and 2) the best version of their data lives outside of their organization.
Dirty data is a common problem at organizations today. From fat-fingered data entries to inconsistent data trapped in data silos, organizations realize that they must fix their bad data in order to make it useful. Part of how they can do that is through enrichment with external, third-party sources. By enriching their data, organizations can improve data quality and increase the completeness of data. And that makes integrating data across data silos much easier.
This is where a data product strategy delivered through the design and use of data products comes in. The best data products pair built-in data quality capabilities that standardize and validate data with powerful, machine learning-driven ID linkage and enrichment capabilities that match internal, first-party data with the best external reference data, enabling the organization to add additional attributes. As a result, organizations can curate data across data silos in order to deliver the best version of data for use in decision-making.
To learn more about how Tamr data products improve the quality of your first-party data fast via third-party data enrichment, please schedule a demo.