The key to thriving amidst privacy regulations

With privacy regulations tightening and third-party cookies disappearing, many ecommerce brands are struggling to maintain customer insights and personalized marketing. This shift is creating a significant challenge: how can you stay compliant while still understanding your customers and delivering personalized experiences?

Recently, we had the privilege of receiving a masterclass focused on first-party data, conducted by experts from Vervaunt. At Ask Phill, we’re passionate about helping brands not just keep up but lead. That’s why we’re spotlighting Vervaunt’s insights to inspire you to elevate your ecommerce strategy. Vervaunt, a pioneering agency in ecommerce strategy and digital marketing, shared invaluable knowledge. We’ve compiled a comprehensive rundown of what we believe is crucial for your success.

Since 2017, when Apple introduced restrictions on third-party cookie tracking through Intelligent Tracking Prevention (ITP), the privacy landscape has evolved significantly. It began with GDPR in Europe, setting the gold standard for data protection. The following year, California introduced CCPA, emphasizing consumer rights and data transparency. By 2020, major browsers like Chrome and Safari started phasing out third-party cookies, pushing us toward a privacy-centric web. Apple’s 2021 iOS 14 update brought App Tracking Transparency (ATT), requiring apps to get user consent for data tracking.

These shifts mean brands must now lean heavily into first-party data to stay compliant while still gaining valuable customer insights. 

Here’s a timeline of key events influencing the need for first-party data:

• 2017: Apple introduces restrictions on third-party cookies with ITP.
• 2018-2019: GDPR and CCPA come into effect, setting new standards for data privacy.
• 2020: Major browsers begin phasing out third-party cookies.
• 2021: Apple’s iOS 14 update with ATT disrupts performance marketing.
• 2024: DMA mandates consent mode and consent banners, with the depreciation of third-party cookies in Chrome on the horizon.

Consumers are more privacy-conscious than ever, with 48% stopping purchases due to privacy concerns. First-party data, the information a company collects directly from its customers—including website analytics, purchase history, customer feedback, and interactions via email or social media—offers a privacy-centric solution. This data, collected with consent, provides transparency and control, ensuring a higher quality and accuracy as it directly reflects user interactions and preferences.

In the privacy-focused digital age, first-party data is essential. It aligns perfectly with current regulations, minimizing risks and ensuring compliance. By leveraging this data, brands can create highly tailored customer experiences based on real interactions, offering deep, actionable insights into customer behavior and preferences. This approach not only adheres to privacy laws but also builds stronger, trust-based relationships with customers, crucial in today’s market.

Collecting first-party data effectively is crucial for building a robust data strategy. Here are some practical tips and real-world examples to help you get started:

1. Membership propositions 

Membership propositions involve offering customers exclusive benefits and services in exchange for signing up and providing their information. This approach not only offers service benefits but also ensures that customers are more engaged each time they visit the site. For instance:

• Salomon has effectively utilized membership propositions by offering perks such as free shipping and faster checkout through their “S Plus” membership. They promote these benefits right from the landing page to the checkout process, continuously engaging customers to sign up and log in. 
  

• J Lindeberg takes this further with a highly intentional sign-up process. Benefits are clearly listed on their sign-up page, including discounts, free shipping, and early access to sales, which has significantly increased their customer sign-ups. Furthermore, during account registration, customers can specify their interests and preferences, enriching the CRM with valuable data that shapes future communications and offers.

• Nike utilizes a members-only catalog to create a unique value proposition, encouraging customers to sign up for exclusive access to special product releases. This exclusivity not only boosts sign-ups but also collects precise data on customer preferences and purchase behaviors.

2. Surface options and rich data capture

Bethan Rainford, General Manager at Vervaunt, emphasized the importance of surface options on websites to enhance data collection. Surface options refer to interactive elements on a website that engage users and encourage them to provide information. These options can include tools, quizzes, or customization features that help personalize the user experience while collecting valuable data.

•  Salomon enhances customer interaction and data collection with its “find the perfect shoe” feature. This tool aids customers in selecting shoes based on their activities and preferences, providing Salomon with valuable data on customer needs and trends.

3. Post-purchase surveys and customer preferences

Capturing first-party data after a purchase is crucial for enhancing customer engagement and personalization across various sectors.

• Interior Define effectively utilizes this strategy by incorporating design preference queries into their swatch ordering process. As customers select a swatch—a fundamental step in buying furniture—they are asked to specify their design style preference. Interior Define then uses this information to tailor the website experience and communications according to their preferences, ensuring personalized interactions and product recommendations.
• Census by Vervaunt Labs: Vervaunt has developed a Shopify post-purchase survey app called Census. This app helps you gather actionable insights and valuable first-party data using personalized, rule-based surveys. Census provides insights into crucial areas like attribution, satisfaction, brand sentiment, onsite experiences, and even bugs. You can design rule-based questions segmented by device, shipping address, cart items, product type, and more. The AI-powered dashboard then processes all this qualitative customer data and feedback, offering AI-generated recommendations, analysis, and scoring. For example, some of their clients discovered through these surveys that gifting was a significant reason customers visited their site. This insight allowed them to adjust their strategy and messaging to emphasize gifting. Census is an excellent tool for effectively leveraging qualitative data directly from your customers.

As we delve deeper into the application of first-party data, it’s crucial to focus on how this data can drive performance marketing efforts more efficiently. Vervaunt’s masterclass shed light on three key strategies:

1. Machine learning and value-based bidding:

The shift towards machine learning in advertising allows brands to use first-party data to optimize bidding strategies and ad placements. By feeding detailed data about customers’ behaviors, preferences, and profitability into machine learning algorithms, brands can ensure more efficient ad spend. For instance, using data on return rates, purchase history, and customer lifetime value (LTV) helps adjust bids to target users most likely to convert at a higher profit margin.

2. Creative optimization for targeted engagement:

Creative content plays a pivotal role in engaging customers. Leveraging first-party data helps tailor creative elements to match the interests and behaviors of the audience, significantly enhancing the impact of marketing campaigns. For example, by analyzing data from previous interactions, brands can create personalized ads that resonate more deeply with each segment, increasing the chances of engagement and conversion.

3. Enhancing audience strategies with first-party data:

First-party data enables brands to refine their audience targeting and segmentation strategies. This approach involves creating high-intent audience lists, such as those who have recently converted or shown high-value behaviors, and using these lists to tailor marketing efforts. Brands can also identify lapsed customers or those at risk of churning, then deploy targeted campaigns to re-engage them, often offering personalized incentives or exclusive early access to new products. 

The shift towards first-party data is essential in today’s privacy-focused marketing landscape, enabling brands to enhance personalization and maintain compliance with evolving regulations. Key takeaways from our discussion with Vervaunt underscore the importance of transparency, innovative data collection methods, and strategic data use to drive marketing success.

If you’re looking to delve deeper into the nuances of first-party data or need expert guidance on integrating these strategies effectively, contact Vervaunt for a consultation.

At Ask Phill, we are committed to helping our clients navigate the complex commerce landscape and achieve their fullest potential. Ready to transform your strategy? Let’s talk.