Third-Party Data

Third-party data is consumer information that is indirectly collected and typically used for advertising and analytics purposes

What is Third-Party Data?


Third-party data in the context of e-commerce refers to information collected by entities that do not have a direct relationship with the consumer. These entities gather data from various external sources, aggregate it, and sell or share it with businesses. This type of data is typically used to enhance customer profiles, improve targeting for marketing campaigns, and gain broader market insights.


Characteristics of Third-Party Data:


  • Indirect Collection: The data is collected by third-party companies from various sources like websites, social media, surveys, and other online activities.


  • Aggregation: Data is often aggregated from multiple sources for a wide view of consumer behavior and preferences (i.e. demographic information, browsing habits, purchase history, interests, and more).


  • Broad Reach: It encompasses a wide range of data points and covers a large audience, making it useful for market analysis and expanding reach.


  • Lack of Direct Consent: Consumers typically do not give their consent to the businesses using third-party data.


Third-Party Data Phase-Out: 


Due to regulatory changes, technological advances, and shifting consumer expectations with regard to privacy, the use of third-party data is being phased out. This has propelled a shift to first-party data and zero-party data. Although these are arguably better, more accurate sources of consumer data, it introduces a new challenge to ecommerce teams who must strategize their means of data collection. However, the value of these kinds of data versus that of third-party data provides new and improved marketing opportunities that can be significantly more personalized


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