First-party data lead generation tactics for luxury brands
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Google, Apple and many of the big tech companies have phased out the use of third-party cookies. Many brands successfully used this type of data on re-marketing campaigns to draw visitors who had visited their sites before without making a purchase back.
Now all companies will be limited to using first-party data (or 1P data) to generate new leads and sales.
Examples of first-party data are:
- Demographics containing information on your audience’s age, income level, and location are essential information determining your customer’s purchasing power.
- Website activity which details the products and content your website visitors have browsed
- Purchase history recording which products customers purchased on previous visits, their purchase frequency and average order values
- Email engagement measuring the clicks and sales generated by offers contained in email newsletters
- Support call information revealing general areas of concern on product quality, delivery and returns as well as sentiment analysis
- Customer interests and behaviours which you can find out by running polls on social media, sending questionnaires to customers and asking for the opinions of visitors.
You can gather first-party data from a number of online and offline sources including:
- Customer Relationship Management (CRM) system
- Customer feedback
- Customer surveys
- Data from email subscriptions
- Loyalty programs
- Product level purchases
- Website, app, and social media account interactions
Companies often face initial difficulties in analysing first-party data because they’re currently held across multiple databases. To overcome this, many invest in customer data platform (CDP) software which simplifies the process of creating and keeping updated a centralised database populated from various sources.
CDPs integrate well with SaaS tools like Data Management Platforms (DMP) and Customer Relationship Management (CRM) apps allowing you to identify and analyse the information they collect. You can then use the results to inform future marketing campaign strategies, product development cycles and more.
How to successfully collect first-party data
Customers’ trust and loyalty in brands have been strained frequently in recent years because of advertising practices they believe are intrusive. As a result, consumers’ attitudes on how their personal data is used have gradually evolved and hardened. In many parts of the world, legislation has been introduced to make the buying and selling of data much harder. Most of these concerns were around third-party data.
First-party data is different. This is data you collect direct from customer interactions. Although the phasing out of third-party cookies has made marketing teams’ jobs harder, you can still create exciting, personalised experiences for visitors based on their historic and current interactions with your brand.
You should, of course, be careful when collecting first-party data. You should obtain explicit permission from consumers to use their data. The Boston Consulting Group (BCG) recommend that companies take the following steps:
- Be visible. Don’t hide options from customers allowing them to refuse permission to use their data. Always give the user control in the decision-making process.
- Show candour. Be upfront and honest about the reasons for collecting and the benefits your business will gain from the activity.
- Demonstrate value. Highlight the incentives like a better customer experience that comes when the company harnesses its data.
Using first-party data to generate leads and sales
Consumers have demonstrated their willingness to purchase luxury goods and services online as, now, almost half of the sales made by the sector are over the Internet.
Mass – and mid-market companies already use first-party data successfully to deliver them better insights into their target audience’s desires, activities, and habits. The same opportunity is open to luxury brands.
Common first-party data use cases include:
- Develop buyer personas. Buyer personas often begin as informed professional assumptions about target customers’ lives, needs and wants. You can amend existing personas and create new ones based on demographic data and purchasing activities to better understand the people you wish to appeal to the most.
- Segment customer lists. Create focused groups of customers based upon what they’ve bought and their average order values. Track the level of interaction and responsiveness of each group to test the product mixes that get the best results.
- Create a smoother buying experience. Discover the sales funnel stages at which prospects drop out to increase the number of people reaching the shopping cart. For customers who fill their carts but leave without making a sale, test which email offers get them to revisit and complete their orders.
- Reward loyalty. It costs five times more to win a new customer than it costs to convert an existing one. Test a range of loyalty and reward schemes for existing clients to see which generates the most sales. For customers who have not purchased in a while, use email to discover whether money-off vouchers or product-specific deals based upon their previous order history get the most winbacks.
- Build relationships. Which blog content appeals most to your customers? Use website analytics to discover the topics which interest your audience the most and include links to relevant content in your emails. People have humanlike relationships with the brands they love so share information with them they’ll probably be interested in knowing.
- Create personalised experiences. In much the way Amazon presents products of interest to visitors based upon their browsing and purchase history, do the same. Make it as easy as possible for customers to find the products they want. You can also highlight specific content on your site related to those products to demonstrate the craftsmanship and quality of your products to showcase your brand values.
- Build more effective landing pages. Use split (A/B) testing on your website and your email campaigns to measure which products and offers generate the most sales.
- Create content your audience values. In addition to product-related content, lifestyle content works particularly well on luxury brand sites. Purchasing luxury products is, after all, part appreciation of the quality and exclusivity of your products and part a membership card to a particular lifestyle they want for themselves. Sell the lifestyle as well as the products. Create a range of content and, using first-party data, show content specific to each visitor based upon their previous visits.
- Improve channel measurement. With engagement and revenue data from all marketing channels, you can clearly map out the routes to purchase taken by clients. Focus your investment and efforts on the channels delivering the greatest returns. When testing new marketing channels, you have performance benchmarks against which you can measure success.
- Focus on the most profitable advertising channels. Analyse cost per visit and cost per sale per advertising channel to determine which brings in the greatest profits. Divert money from less profitable campaigns to scale up your successful ones.
- Reflect shifting consumer tastes in products. Compare current and historical data to analyse which products and product variations are gaining or falling in popularity and lead with popular products and variations first to encourage clickthroughs to buying pages.
Make the most of your first-party data with VERB Brands
Many brands’ sales will be adversely affected by the end of third-party data use. First-party data does not give you the same flexibility but it does give marketing teams an opportunity to focus more on customers’ onsite experience and make it even more personal to them.
VERB Brands provides marketing and consulting services to luxury brands around the world. We are helping existing clients to focus on growing sales through first-party data and we’d love the opportunity to work with you on it. Reach out via our contact form.