# What Is First-Party Data? A Beginner's Guide | Capterra > Learn the ins and outs of first-party data so you can take advantage of the most powerful source of information you have: your customers. Source: https://www.capterra.com/resources/first-party-data --- Data and AnalyticsMarketing # What Is First-Party Data? A Beginner's Guide Written by: Gary Froniewski Gary FroniewskiAuthor Gary Froniewski is a Content Writer at Capterra, covering all things digital marketing, with a focus on emerging trends in experiential marketing. A recipien... [See bio & all articles](https://www.capterra.com/resources/author/gfroniewski/) Published November 17, 2023 11 min read ## First party customer data is the most important data you have at your disposal. Do you collect customer data? The answer is likely yes (even if you don’t know it).  Whether it’s responses to marketing emails, data collected from marketing software, or even just feedback gleaned from customers in the course of doing business, the first-party data _you_ collect is the most powerful data at your disposal.  To understand why, it’s important to know what first-party data is, the benefits of prioritizing it, and the potential roadblocks that stand in the way of meaningfully implementing it into your marketing strategy. Below you’ll find all this plus Capterra survey insights from other business owners navigating this topic. Whatever stage your business is in when it comes to understanding and utilizing first-party data, this guide will help you as a small business marketer reach more customers and better serve the ones you already have. ## What is first-party data? **First-party data (1P)** in a marketing context is the information you collect about your customers, subscribers, or visitors to any of your marketing channels. This includes user behavior on your website, mobile application, social media channels, and marketing emails, etc. This data is especially valuable because it comes directly from your customers. A subset of first-party data known as **zero-party data** also includes information customers provide _intentionally_ in the form of actions such as responding to surveys. ### Sources of first-party data Here are some of the most common sources of customer data according to Capterra’s 2022 Privacy-Focused Marketers survey[\*](#methodology): Common sources of first-party data also include any of the owned marketing channels where you have unfettered access to data. These channels can include: - **Website:** As seen in the survey data above, one of the biggest sources of first-party data for any business is its website. When users visit the website, interact with content, sign up for newsletters, or find their way there from other marketing channels, this is all valuable information that can either improve the customer experience or help prioritize future site updates based on customer behavior. - **Social media:** A now-ubiquitous form of interaction between consumers and businesses, social media represents a high-traffic touchpoint for collecting customer data. Social media platforms often offer native analytics functionality that can provide valuable demographic information as well as customer insights into high-performing content. This includes metrics such as impressions, engagement, and link clicks that inform future marketing content (on social media _and_ other channels). - **Email:** As a channel that’s embraced by a full 100% of businesses according to Capterra’s 2022 Email and Social Media Marketing Survey[\*\*](#methodology), email represents a huge opportunity to reach your customers that you can’t afford to miss out on. Email is one of the most preferred communication channels for consumers, and it is fully owned by your business, meaning you have full access to and control over the data you’re gathering. - **Mobile app:** If your business has a mobile app of its own, operates on an existing mobile platform, or conducts SMS marketing, there’s plenty of customer data to be collected. With text messages having an astonishing open rate of 99% [\[1\]](#sources), there’s an incredible opportunity to learn more about the type of content that resonates with your customers enough to earn further engagement (and hopefully conversion). ### What are the other types of customer data? Aside from first-party data and its subset, zero-party data, there are two other forms of customer data worth discussing here. **Second-party data** and **third-party data** represent information that has been sold or shared by another company _or_ obtained from an independent data aggregator, respectively. For a refresher on customer data management, check out: [Customer Data Management in Marketing: What You Need to Know](https://www.capterra.com/resources/data-management-in-marketing/) ### Why is focusing on first-party data important? For our purposes, you should be aware of all available types of customer data, but ultimately they should not be the priority, especially as a resource-constrained small business. First- and zero-party data is data _you_ control that’s voluntarily offered by your customers. This type of data is more indicative of your audience’s true sentiment, and it costs less for you to obtain and use. Fully owned data also allows for greater integration into other areas of your marketing tech stack, further increasing the effectiveness of your technology (and, ostensibly, your marketing results). Lastly, having access to solid customer data gives you greater insight into opportunities for [marketing personalization](https://www.capterra.com/resources/personalized-marketing/), leading to an improved customer journey, a more personalized experience, greater segmentation opportunities, and an overall increase in marketing ROI. ## What are the benefits of using first party data? ### Improved customer experience First-party data is data gleaned directly from your customers. Since this data can include info on their product/service wants and needs, how often they’re engaging with your content, or reveal things that cause them _not_ to convert, it’s especially valuable when it comes to improving the customer experience overall.  Use 1P data in this way to craft [personalized marketing content](https://www.capterra.com/resources/personalized-marketing/#:~:text=customers%E2%80%99%20specific%20needs.-,What%20is%20personalized%20marketing%3F,-Personalized%20marketing%20is) that truly resonates with your customers, shore up inefficiencies in your website experience, inform your product and service development, or even further define your target audience in the form of defined [customer personas](https://www.capterra.com/resources/brand-storytelling/#:~:text=Characters%20\(customer%20personas\)). ### Insights from data are more reliable Since 1P data comes directly from customers, it offers the most accurate insight into what your target audience wants out of their relationship with your business. This also applies to customer information that falls outside of community sentiment as well (e.g., demographic, firmographic, and psychographic data). You may make some surprising discoveries about your most loyal customers, including a powerful audience segment you might not have been aware of. This gives you the opportunity to [be more inclusive with your marketing approach](https://www.capterra.com/resources/what-is-inclusive-marketing/#:~:text=Be%20open%20minded%20about%20your%20target%20audience), letting you cast a wider net from a marketing perspective (and be a more socially responsible business in general). ### Increased ROI An improved customer experience, more insightful data, and the updates to your marketing efforts that come from those will necessarily increase your marketing ROI when implemented appropriately. Whether it’s through more-efficient application of your current tactics, new learnings about your audience, or [increased personalization of marketing content](https://www.capterra.com/resources/personalized-marketing/#:~:text=%C2%A0%C2%A0%C2%A0Personalization%20benefits), all roads lead to improved marketing results. ## What are the challenges of using first-party data? ### It takes resources and expertise to collect data and draw insights If you don’t already have a robust [customer data management](https://www.capterra.com/resources/data-management-in-marketing/) (CDM) strategy in place, it can prove difficult to get up to speed. Proper analysis of customer data requires understanding the sources you get customer data from, connecting marketing tools together to share data amongst themselves, and personnel to actually do the analysis. We’ll discuss more about these resources below, but be mindful of this requirement when planning to take more advantage of 1P data. ### Use of data needs to be specific and map toward organizational goals Collecting data without a business objective or marketing goals in mind is a bit like piling up dirt without having a truck to haul it. Sure, you’ve got a lot, but you can’t do anything with it. It’s crucial to have well-defined marketing goals in order to understand what data is most important and how it will affect your strategy and tactics. In our article on [how to analyze marketing data](https://www.capterra.com/resources/analyzing-marketing-data-how-to/), we cover a [SMART goal setting](https://www.capterra.com/resources/analyzing-marketing-data-how-to/#:~:text=companies%20in%20Dallas-,Step%201%3A%20Define%20the%20most%20important%20key%20performance%20indicators%20\(KPIs\),-You%20can%20have) approach to define the most important KPIs at the outset. Put simply: Setting SMART goals allows your customer data insights to track toward a specific and measurable purpose. ### Analyzing and implementing first-party data is an ongoing process that requires maintenance As mentioned, there is a lot of preliminary work involved in fully taking advantage of your customer data. However, it’s also an ongoing process. Ensuring a data source remains accurate and navigating changes from big industry players (such as [the end of third-party cookies](https://www.capterra.com/resources/first-party-data-strategy/#:~:text=The%20end%20of%20third%2Dparty%20cookies%20has%20been%20years%20in%20the%20making) and [regulations around specific platforms](https://www.capterra.com/resources/tiktok-ban-impact-on-marketing/)) require a significant amount of time and attention over the long term. ## Customer data management tools and resources ### Technology There are a variety of software solutions that can help with customer data management. For more information on CDM in general, including more details on the specific types of software outline below, visit our article on the subject here: [Customer Data Management in Marketing: What You Need to Know](https://www.capterra.com/resources/data-management-in-marketing/) - **Data management:** Data management software acts as a unified data collection platform that organizes and analyzes business data from various channels such as software, customer databases, and social media. The goal is to [present data in an easy-to-use format](https://www.capterra.com/resources/analyzing-marketing-data-how-to/#:~:text=Enter%20data%20visualization.-,Step%204%3A%20Use%20visualization%20tools%20to%20tell%20a%20compelling%20data%20story,-The%20importance%20of). This aspect is especially important considering that, according to Capterra’s 2022 Data Visualization in Marketing Survey[\*\*\*](#methodology), a full 89% of marketers say their managers prefer viewing reports that use data visualization. _An example of data visualization functionality from ShareArchiver (_[_Source_](https://www.capterra.com/p/144713/sharearchiver/)_)_ - **Customer relationship management (CRM)**: [CRM software](https://www.capterra.com/customer-relationship-management-software/) is a technology solution that helps your business manage the data of current and potential customers with the goal of maintaining healthy relationships with them. It lets you track leads, send marketing emails, automate sales tasks, and create custom reports. CRM software, in short, is a centralized repository of all customer-related information. _An example of a dashboard showcasing deal information from HubSpot CRM (_[_Source_](https://www.capterra.com/p/152373/HubSpot-CRM/)_)_ - **Customer data platform (CDP):** Unlike general data management platforms, a [customer data platform](https://www.capterra.com/customer-data-platform-software/) is a software solution that helps collect and organize customer data from sources such as web forms, email, social media, and more. The advantage of true customer data platforms lies in analyzing lifetime customer behavior. Moreover, CDPs are capable of influencing all types of marketing—email, SMS, and social—all the while retaining that data to build in-depth customer profiles. _An example of a customer profile from Bloomreach (_[_Source_](https://www.capterra.com/p/173203/Bloomreach/)_)_ ### Expertise Aside from proper technology, it’s also important to have people that are trained to run it. Whether that means yourself, internal teammates, or a little help from outside your organization, it’s crucial to have a plan in place for who will be collecting, analyzing, and harnessing your customer data. Depending on your business’ current growth stage, this could mean hiring the help of a third-party service provider like a digital marketing or marketing analytics agency. The best way to decide what type and level of relationship you need is to assess your marketing goals and business objectives. If you already have a solid foundation and just need tactical help with bolstering your customer data analysis, a marketing analytics agency may be the right choice for you. They can identify both gaps and areas of opportunity in your process with an outside perspective. However, if you don’t yet have some of the basics figured out, e.g. properly tuned tech stack, marketing goals mapped to organizational objectives, etc., it may be best to seek out a more general digital marketing agency to help you answer those questions. ## Putting it all together: Am I ready to implement a first-party data strategy for my business? First-party data represents the best way for you to take control of the customer data you’re collecting to make more-informed decisions about your marketing efforts. Not only does first (and zero) party data offer more valuable insight into your audience, it also improves the customer experience and—when implemented meaningfully—bolsters your overall marketing ROI. When taking on the task of wrangling your first-party data, ask yourself the following questions to get started: - What data do we have access to now and how are we utilizing it? - Do the tools we currently have perform the customer data functions we need to get started? - [Do our current tools integrate](https://www.capterra.com/resources/crm-integrations-help-your-business/) well together? - Who will be responsible for heading up our [customer data efforts](https://www.capterra.com/resources/data-management-in-marketing/#:~:text=of%20marketing%20data.-,Resources%20needed%20to%20uplevel%20your%20customer%20data%20management,-The%20ways%20in)? - Does that person (or team) have the [data literacy](https://www.capterra.com/resources/latest-trends-in-marketing-analytics/) skills needed to manage our customer data? Thinking about it from this perspective early on will help ensure you have the skills and technology in place to give your fully owned customer data the attention it deserves. For more info on marketing analytics and how you can improve your own data strategy, visit the Capterra blog and start with these resources: - [Improve Your First-Party Data Strategy—Our Research Shows You How](https://www.capterra.com/resources/first-party-data-strategy/) - [Online Marketing for Small Business: Strategy Tips From Successful SMBs](https://www.capterra.com/resources/online-marketing-for-small-business/#get-to-know-your-audience) - [Customer Marketing—The Channel You Can't Ignore](https://www.capterra.com/resources/customer-marketing-channel/) * * * _Note: The screenshots of applications included in this article are examples to show a feature in context and are not intended as endorsements or recommendations._ * * * **Methodology** \* Capterra conducted this survey in January 2022 among 299 respondents to learn more about small, midsize and large business email and social media marketing tactics. Respondents were screened for full-time employees of all company sizes that have involvement with marketing-related activities. They must have been working within roles including advertising, brand management, customer experience or service, data and analytics, IT, marketing, product marketing and management, sales or strategic planning and be current email and social media marketing users. \*\* Capterra conducted this survey in April 2022 among 299 U.S. marketers to study marketer actions, attitudes and reactions towards data privacy. Qualified respondents were screened to work full-time in marketing, advertising, sales, or IT departments and have some level of involvement in marketing-related activities.  \*\*\* Capterra's 2022 Data Visualization in Marketing Survey was conducted in October 2022 among 294 U.S. marketing professionals to learn about how data visualization tools or software impacts stakeholder decision making. Respondents were screened to have marketing, advertising, communications, or public relations job functions or have some level of involvement in marketing-related activities. All respondents use or produce marketing data to inform decisions. Sources 1. [Market Guide For Mobile Marketing Platforms](https://www.gartner.com/document/4020413), Gartner * * * ### Was this article helpful? * * * ## About the Author [### Gary Froniewski](https://www.capterra.com/resources/author/gfroniewski/) Gary Froniewski is a Content Writer at Capterra, covering all things digital marketing, with a focus on emerging trends in experiential marketing. A recipient of multiple AMD Spotlight Awards for flagship product launch campaigns, he has a wealth of experience creating compelling copy to support Fortune 500 companies and small businesses alike. 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