4 Ways to Use Third-Party Data in Your Digital Marketing Strategy

Man's hands symbolically holding customer data

Every day, the amount of data that is being generated about customers is increasing exponentially. The World Economic Forum reports by 2020, the entire digital universe is expected to reach 44 zettabytes. If this is the first time you’re hearing the term “zettabytes,” you know the amount of data being created is colossal.

Businesses can take advantage of all this data by working with third-party data providers. Third-party data is information collected by an entity that isn’t directly connected to the user the data is being collected on. For example, a third-party data provider might pay a publisher or group of businesses in order to collect data about their users and customers.

The data could include information such as web browsing activities, purchase history, postal address and social media handles. That provider would then sell those results to other organizations looking for insights.

Businesses can use third-party data to learn:

  • More about their current customers
  • Where to find their target customers
  • How their target customers want to be reached

Third-party data has plenty of uses for online targeting. Here are some ways to use third-party data in your digital marketing strategy.

1. Show Ads to Refined Audiences

Third-party data providers save businesses time in defining audiences. Businesses can purchase data sets for the exact target audience they want, however refined that is, and then target ads directly to those people.

For example, if you want to show your ads to families in a certain ZIP code who have actively been researching kitchen remodeling sites (and have been for the past 3 months), you can. This type of third-party data usage means you can get your ads in front of the eyes you want when you want.

2. Drill Down Insights

Broad third-party data is always available to inform marketers. For example, if you’re an ecommerce retailer, you have access to plenty of data about holiday shopping trends throughout the country. You already know that the Monday after Thanksgiving is a huge opportunity for eretailers, including yours.

But say you sell online fitness video subscriptions. The broad data says a certain percentage of people is likely to make a New Year’s resolution to go to the gym, but out of these people, what demographic is open to working out using online videos? And how many days after January 1 does it take for them to actually make a move on their workout resolution?

It can be tempting to use broad third-party data to influence your strategy, but detailed third-party data can give you granular insights that are specific to your business. In this case, it might make more sense to allocate more ad spend to the days after Christmas, rather than Cyber Monday.

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3. Refine Your Own Audience

If you’ve been collecting first-party data, you probably have a general idea about your current customers. For example, a makeup line might understand most of their customers are females ages 20 to 30.

Using your insights, you can work with a third-party data provider to learn more about your customers and improve your targeting. For example, you might discover that this age group spends most of their time on Facebook on their mobile phones. Using this third-party data, you can shift your marketing strategy to Facebook mobile ads.

You can use third-party data to discover other prominent brands your target audience purchases from. Then, you can partner with those brands, show your ads on publishers those brands have had success with, or use marketing strategies those brands use and apply them to your business.

You can also use third-party data to learn about the customers of your competitors, and then target those demographics for your own customer base.

4. Personalize the User Experience

Personalization is huge to customers today. Some stats market research company GlobalWebIndex points out about personalization include:

  • Businesses that personalize web experiences see an average 19 percent increase in sales.
  • High-performing businesses use data targeting and segmentation 51 percent more than under-performing businesses.
  • Personalized email messages improve click-through rates by an average of 14 percent and conversions by 10 percent.

Third-party data helps you personalize the customer experience based on preferences. You can use third-party data to learn about customer preferences based on location, age, device and more. Then, you can show customized website copy and design to those segmented audiences.

Your ad creative can become more personalized depending on the target audience, too. Based on interest and demographics, you can create highly personalized ads and web copy that really speak to that audience and inspire more conversions.

Feed Each Data Source into the Other

As you run campaigns and test and analyze, you’ll gain more insights into your target audience, which will help you determine better third-party data to obtain. Using both first- and third-party data sources, you can gain deep insights about your current customers and target audience, so that you maximize the value of each customer you have through targeted digital marketing efforts.

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