Data Sources: 1st, 2nd, & 3rd Party
cartoon image of 1st, 2nd and 3rd party data
From algorithms to analytics to recommendations, data has become a useful tool in digital marketing. Knowing certain characteristics about certain demographics can help with putting together the right product, at the right time in front of the right audience.
cartoon showing the difference between 1st, 2nd and 3rd person in grammar
1st? 2nd? 3rd?
Coming from a liberal arts background, I found it easiest to understand these three types of data sources from a writing point of view: first-person, second-person, and third-person. First-person indicates the speaker (you), Second-person indicates the addressee (the person you are directly speaking to), and Third-person indicates someone outside the individual (neither the speaker nor addressee). Don’t worry, we’re going to translate this to data sources very soon.
1st Party Data Sources
cartoon showing 1st party data examples
First-party data sources — like the first-person point of view — deals with the subject which in this case would be you or your company. 1st person data is data collected about your customer from you or your company.
Examples of this include data from your newsletter sign-up, purchase history, website traffic, customer feedback, etc. First-party data is considered the most valuable for a variety of data analyses because it is the most accurate and can be used to plan the most reliable campaigns and marketing strategies. The downside of first-party data is that you are limited to your audience.
2nd Party Data Sources
cartoon showing 2nd party data examples
Second-party data sources — like the second-person point of view — deals with an addressee which in this case would be another person or business. Second-party data is data collected from someone else’s data.
Examples of this include two businesses sharing data with each other that can include a list of contacts, or a purchase list. It is essentially first-party data from another business. This can be useful with businesses that cater to similar clientele, however, you can run into privacy issues since the data is coming from an outside source.
3rd Party Data Sources
cartoon showing 3rd party data examples
Third-party data sources — like the third-person point of view — involve an outside party. Third-party data is data that is collected by someone not directly linked to the end customer. This data is typically collected through random sampling and is purchased.
Examples of third-party data sources include lists generated by research companies or purchased contact information. Third-party data can be useful for comparison or to round out first or second-party data. The cons of third-party data include privacy concerns, general and less accurate data, and that the data set can be purchased by anyone so it will not be unique to your business.
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Conclusion
To wrap up, today we learned that first-party data is collected from you or your business, second-party data is collected from another (typically similar) organization and is shared while third-party data is collected from an outside source.
While each data source has its pros and cons, the most useful will depend on your marketing goals and strategies for the future.
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