Why You Need a Data Partner for Better Marketing Outcomes
If you’re a marketer, it’s very likely you’re after what every other marketer is looking for these days: quality data.
You’ve used up the bulk of your first-party data, or your own data that’s stored in-house, and so scalability has reached its peak. You need more of the right data to target the right audience, but you don’t want to dip into the unknown: third-party data. So what’s your move?
Imagine having a non-competitive partner (or two or three…) with whom you share like-minded customers. In a data partnership, you’d have the ability to take advantage of targeting another’s relevant and valuable first-party data audience. Furthermore, imagine swapping first-party data audiences with partners of choice – an increasingly popular strategy with retailers and brands that are sharing data for mutual benefit. In this scenario, also referred to as a second-party data initiative, brands see more sell-through of their product at retail, while retailers see increased sales. In the end, it’s a happy medium.
At the same time, while trading your first-party audience data is clearly worthwhile, no one is saying the process of doing so is easy. Especially not when you’re attempting to do it alone, without the help of a second-party data platform (i.e.transparent data marketplace). In other words, even the most proficient data sharing practitioners can face execution challenges if they’re not armed with the right tools.
As evidenced in a study conducted by Forrester Consulting on behalf of ownerIQ, The Era of Second-Party Data is Here, 49% of those companies surveyed are still in the process of defining and rolling out their second-party data strategies. But that doesn’t necessarily mean the 51% that have a strategy in place aren’t experiencing some growing pains. The majority of these companies — 59% — work directly with partners, costing them time, effort, and resources. The top challenges for those sharing second-party data directly with partners include:
- Audience duplication
- Issues with data security
- Working on different platforms
- Prolonged processes
The good news is that advertising and marketing leaders recognize that there are a number of sophisticated options available in the current landscape. While many advertisers and marketers will expect their DMP (41%) or agency (33%) to broker partnerships, 49% are interested in working with independent third-party solutions providers, thereby significantly broadening their potential partners. Only 10% had given that option a trial as of the date of this study, despite the fact that third-party solutions providers can both help find and facilitate the right partnerships, thereby eliminating the friction that arises from working in direct relationships.
“[Working with third-party providers] allows our trade customers to access our audience . . . and gives them the opportunity to access somebody who’s actually in the market. They’re not wasting their marketing and advertising dollars blanketing the web with banner ads that maybe aren’t actually accessing the audience they’re even interested in.” — Digital marketing director at a retail firm
Smart advertisers and marketers put data at the center of their strategies for reaching and connecting with their customers and prospects today and will do so even more over the next three to five years as they refine their second-party data strategies.
Second-party data sharing partnerships can yield significant value — including greater scale, improved customer insights, increased sell-through, and more efficient campaigns — but technical issues and data concerns can be obstacles to success. Moreover, the process of identifying potential data partners; recruiting them; negotiating compensation, terms, and conditions; launching a campaign, and reporting value can be cumbersome.
Advertising and marketing pros will seek to overcome these issues as they strive to meet their customers’ expectation of relevance, expanding their strategies to include a variety of data sharing options. Independent third-party solutions providers will play an increasing role in second-party data strategies, making it easier for advertisers and marketers to enter into — and execute — strategic partnerships with parties beyond their own ecosystem.
Looking to find a data partner and access transparent data sources for exceptionally targeted digital marketing? Learn more about where the industry stands and read about the benefits (and top challenges) of second-party data in this latest study.
Included in this post are some key takeaways from a commissioned study conducted by Forrester Consulting on behalf of ownerIQ.