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Retail’s Best Gift Ever? Zero-Party Data

Things haven’t been easy of late for the retail sector. The combination of labor shortages, rising costs, product availability and shipping delays, and of course good old-fashioned DTC competition and everything else we’ve heard about brick-and-mortar’s denouement for the last decade or so have maxed out the stress levels of everyone in the retail space, making it even more difficult to prioritize the urgent versus the important.

One silver lining though all of this has been the emergence of zero-party data in retail’s marketing arsenal. Defined as data customers are willing to give to brands/retailers in return for discounts via a loyalty/rewards program or email, zero-party data is an oft-overlooked form of data collection thanks to its simplicity, but is now having a moment that will likely turn it into a permanent fixture in retail marketer’s toolkit. Why?

With recent missteps by social media giants like Facebook, consumers have become increasingly aware of how their personal data is collected and used. By comparison, zero-party is both more accurate, and yes, more ethical. The information can be as simple as a user sharing email preferences, gender and region of the country they’re in. But these basics, coupled with the insights retailer are already able to glean from other sources, create an incredibly robust customer profile.

Getting to Less Guessing

All retailers want to guess less, and the more they dig into zero-party data and find clever ways to get customers to share personal details, the closer they get to a higher, more granular understanding of them. That understanding leads retailers to a better chance at creating stronger relationships, connecting with more relevant audiences and converting sales faster.

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Besides rewards programs, traffic-hungry retailers are using fun social media surveys, email promotions/newsletters and in-store kiosks to get their customers to share more of who they are and what they want from their retail experience.

Think of it this way: first-party data may reveal someone’s favorite style of jeans or even their favorite brand, but zero-party data, when done effectively, will tell a marketer when someone is planning a night out on the town next week. Now, combine those insights with first-party POS data (information consumers provide at checkout), and the combination of data assembles the puzzle of who your customers are in an incredibly illuminating way.

So how should retailers use zero-party data? Here are some best practices for making the most of it:

  • Think about who you want to reach. Zero-party data is best used when it helps to identify a key audience that would otherwise be too hard/expensive to find. Think about how best to manage engagement and monitor to make certain you’re providing value.
  • Don’t be creepy: You may know your customer because there is certain information they volunteered, because they expect it to make their life easier. Still, respect boundaries.
  • Listen and then act accordingly: If a customer tells you they’re the outdoors type, don’t show them ads for a slinky cocktail dress.
  • Activate utilizing these new insights, making sure to include meaningful calls to action so you can drive conversion.

Effective use of zero-party data to serve up curated experiences based on shoppers’ consumption will bring those customers back throughout the year, making it truly the gift that keeps on giving.


Sherif Fahmy is SVP, Strategy & Analytics at IN Connected Marketing. Fahmy brings a balanced perspective on solving business problems with 15+ years of agency-based innovation, shopper marketing and retail media experience, coupled with time spent at leading retailer CVS Pharmacy operating the ExtraCare loyalty platform for suppliers. Sabina Klein is VP – Retail Marketing at Jun Group, where she leads shopper marketing sales and strategy. Klein has over 17 years of experience in CPG advertising, with deep knowledge in the retail media industry in both traditional and digital media. She has been the center of excellence for retailers and CPG manufacturers ranging from CVS, Ahold, P&G, Bayer and J&J.

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