What is Zero Party Data?

Learn how to collect zero party data, and why privacy-first experiences win.

A new era of customer experience has arrived, and this time, it's all about Privacy.

Data scandals across the inter-webs have left customers skeptical about how organizations use their data. This means that businesses need to shift how they build trust with customers in order to collect the data they need in order, while deliver a personalized experience. Data collection "as per usual" needs a big overhaul.

So how can brands navigate this? Our research suggests it all starts with being transparent and up front with customers about the data you collect, and affirming the value you will provide customers by requesting and collecting their data. This is where Zero Party Data comes into play.

Zero Party Data: As easy as (0) 1, 2, 3.

Zero Party Data (ZPD) is customer-owned data that is collected with consent. This means that it is data a customer intentionally and proactively shares with a brand in order to create a better, and more tailored, customer experience. This notion of asking for data ushers in a number of new possibilities for how companies can delight customers without relying on poor quality data sources.

ZPD can include personal preference data (e.g. A coffee-goer who likes their lattes less sweet), purchase behavior (e.g. I'm researching mortgages, but not ready to buy just yet), personal details(e.g. My birthday is June 5th), and how the individual wants the brand to recognize them (e.g. Send me rewards and promotions emails weekly). ZPD covers a ton of customer data, so want makes it unique? the key difference here is that the customer willingly shares this information in order to benefit their experience with a brand. It also means that brands now have to prove to customers why they deserve to have access to this data, and it also means that brands need to make it easy and seamless to collect this data.

Zero Party Data versus First, Second and Third Party Data.

Data types, explained. Now that we have a sense of ZPD, let's take a look at how it differs from other types of popular data types

First Party Data

This is data that is collected and/or monitored via closed-company channels. This information isn't explicitly collected, but supplements gaps found in a customers profile that might be collected via ZPD. These channels can include mobile apps, chatbots, SMS, website activity and more. For example, once a customer is authenticated in a chat-experience with a customer support representative, the conversation documented would be considered First Party Data collect from a company's chatbot channel.

This type of data is the next best alternative to ZPD, but it's only effective if channel conversations can be effectively mapped back to data about a customer coming from different customer-company interactions across omni-channel solutions.


Second Party Data

Short and sweet. This type of data is first-party data that is packaged and sold to other companies. This type of model has resulted in a major breakdown in consumer trust, as organizations now use alternative channels to broker the sale of data to help get a better picture of consumers.


Third Party Data

This is when data really starts to fly. This type of data consists of multiple data streams, aggregated and collected from multiple sources and companies. This data is then bundled and sold to companies. Usually, this data is packaged and sold by a company who did not collect the data, which causes major issues for traceability, security and consumer trust.

Second and third party data scandals have permeated news outlets for the last few years, whether it be the pay-for-order-flow issues associated with the business model at Robinhood, or the Cambridge Analytica data abuses associated with Facebook. Consumers are starting to see that these data sources are harmful, and don't have their best interest in mind. Companies need to be careful not to follow suit, and search for new ways to keep their data collection practices onside with privacy trends and customer expectations.

Why Zero Party Data is so important.

ZPD is a trend that's here to stay, because customers are waking up to the fact that they no longer want to engage with products that mine and share their data without consent.

The  value in ZPD is that the customer is in the driver seat, and is a willing participant in sharing information. They share it knowing that value is being brought back to them. Additionally, it's one of the highest quality data sources you can find, because you collect this customer data right from the source. This means that you're getting high quality information, while also building amazing trust for your brand.

In addition to ZDP being higher quality, the inverse is happening with second and third party data sources - you honestly just cannot rely on their quality or trustworthiness. Regulations like GDPR are scrutinizing third party data streams, and internet browsers are quickly phasing out tracking software like Cookies. Additionally, software and hardware platforms, like Apple, are moving towards policies that are blocking streams of second and third party data, so organizations need to pivot quickly into more transparent data streams. The days of a free pass for sharing data without consent are no longer.

So where do we go from here? 

Ultimately, in the long run, building a customer data profile with ZPD is the best way to balance personalization, with trust baked in.

How to collect Zero Party Data.

Now for the important stuff. How to collect and make the best use of ZPD. Shameless plug, this is where Voiceform comes in. ZPD is collected right from the source, so now all you have to do is ask!

ZPD is all about collecting information about customers that help you create an experience that's personalized and provides clear value to the user. In order to get this information, you need to ensure you are asking customers at the right time, and presenting them with questions that get you the highest quality of data.

At Voiceform, we believe that Voice is an incredibly powerful tool to collect rich qualitative data about your customer. With Voice, you're able to understand customer emotion, sentiment and the unwritten context behind their behaviour. You're also able to collect 3-4x more data from customers through voice conversation than just traditional text communication alone. Voiceform's voice-powered surveys and forms let you ask qualitative questions that let your customers share exactly how they feel, and why.

The biggest tip we can provide is that you must make sure when asking for customer data, you outline why you are asking for it, and what value it brings back to the customer. With the Voiceform platform, we make it easy to stand up accessible and interactive zero party data collection flows that help you collect the exact data you need, while still providing a transparent and trustworthy customer experience.

The future of personalization will be a winning combination of Zero and First Party Data.

Organizations that can effectively pair zero and first party data into a holistic view of their customer will be set up for success in the long run. Data is only powerful when you connect the dots, so working with solutions that left you effectively do that, and build a total customer picture with your data will be key. With Voiceform, we can seamlessly help you marry data points from zero and first party channels. Whether it's CRM data, or data collected through communication platforms, Voiceform allows you to fill gaps, and get a 360 view into the customer, which set you up for providing a personalized experience that customers know comes from a foundation of trust.

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