6 Commonly Asked Questions About Second-Party Data

November 10, 2016 — by Heather Blank    

This byline originally appeared on iMediaConnection.

Second-party data can sometimes be a mysterious concept in a marketing world where first- and third-party data seem to reign supreme. What is it, exactly? Second-party data is the merging of your first -party data with insights from other brands’ first-party data. This data set can be used to learn more about your current and prospective customers to refine your targeting strategy and better evaluate your campaign performance. I have been helping clients use second-party data to drive higher ROI for over eight years. Here are some of the most common questions I’ve been asked about second-party data.

1. I’ve had mixed results with third-party data. What is better about second-party data?

Second-party data definitely has some advantages over third-party data. The source of second-party data is always known — it’s other brands’ vetted, first-party, transactional, and behavioral data — which isn’t always the case with third-party. It is typically more accurate, more granular and directly relevant to your customers. Second-party data is matched to your data via a centralized source. This ensures higher match rates and more accurate matching. Second-party data also enables you to find users who demonstrate the same patterns as your best customers. Instead of targeting broad segments of users based on demographics or aggregated behaviors, you can use second-party data to find users with exactly the right behaviors that predict response.

2. How does second-party data help me get new customers?

Second-party data enables marketers to scale far beyond their own user pool and find shoppers online most likely to be interested in their products. The biggest way second-party data helps in prospecting is through its use as a seed to build predictive lookalike models. Using a set of proprietary algorithms, marketers can find, score, and target users most likely to behave the same way as their most valued customers, resulting in optimal performance outcomes. These can be users who have never visited your website before and have the highest propensity to convert.

3. How do I leverage second-party data for my reactivation strategy?

Most advertisers have a large reactivation segment, but not enough budget to re-engage everyone. You need to know who is worth the investment, and second-party data can help. Use second-party data to identify which of your lapsed users are under-spending with you, who is currently in market for your products or who recently bought complementary items. These types of insights enable you to prioritize your spend on those most likely to return to your brand.

4. How do I protect my data in a second-party data environment?

Ask your data partner to share their data aggregation rules. Top things to look for are restrictions around competitive conquesting and guidelines that limit disproportionate data contribution. Your partner should provide a breakdown of how your data compares to the overall database as well as what portion your data represents within specific categories. Only work with providers who ensure all data is aggregated and anonymous. Data should never be resold, and marketers should be able to opt out of the environment at any time.

5. What sort of results should I expect?

Second-party data is best when orientated towards identifying behavioral patterns that predict conversions. When lookalike modeling is applied, models that predict the highest lift are typically used. While results will vary depending upon the type of campaign, prospecting strategies using second-party data often see much higher ROAS (300 to 400 percent increases), ROI and conversion rates, and lower CPA.

6. How can I use second-party data to drive insights?

Second-party data can help you understand what your customers are browsing, carting, and buying when they’re not on your site. Common personas can be built from this information, empowering you to tailor your targeting and creative messaging in a precise, scalable and efficient way. You can also utilize second-party data to identify which audiences will increase campaign performance and use audience profiles to inform messaging and targeting strategies.


  • Peter Harvey

    November 14, 2016 at 7:49 am


    by other “Other brands first party data” you mean non-competing brands, correct?


    • Heather Blank

      November 14, 2016 at 3:15 pm

      Hi Peter,

      That is correct. I recommend clients work with providers that have guidelines in place that protect against usage from competitors and ensure equal data sharing.

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