The Power of Third-Party Data


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The Power of Third-Party Data

The first thing to sort out when considering a data strategy is what types of data you have, what types you need, and how you can use both. The two main segments of data are first-party and third-party.

First-party is the foundation of your marketing strategy. This is the internal data that is collected about your customers from customer-facing systems, such as websites, email, mobile applications, and other first-party channels. When a customer enters his or her contact information into a web form and clicks ‘submit’ that information automatically becomes a part of your first-party data. It’s the most valuable because it’s the only data that’s free of cost, and since it’s provided voluntarily by the individual it makes it the safest data also. But, while very important, first-party data is only truly powerful when it’s combined with its data cousin: third-party data.

Third-Party Data to Append

Third-party is external data available for purchase by data providers who source and aggregate the data into applicable sets that can be applied to your first party data bases. This data is integral to deploying targeted marketing campaigns, because they provide hundreds of data elements that no consumer would fill out in a single form. With only a few first-party data elements, third-party data sets can be appended to correct and fill in missing elements such as email addresses, phone numbers, lifestyles, demographics, purchase indicators and more to strengthen your customer insights.

Third-Party Data to Target

Marketers can also purchase third-party data when there is no first-party data available. These highly specialized data sets are generally segmented by a defining factor such as lifestyle, life change events, location, and more. For instance an auto repair company could purchase a third-party data list of consumers who recently moved into their area. This mover list would include contact information, behavioral and lifestyle data, and more so that the repair shop could form a targeted marketing message for these recipients. Similarly, a company specializing in baby proofing homes could reach out to a data set of new parents whose children are nearing toddler age.

Third-Party Data to Advertise

More so than ever, marketers are embracing digital display advertising to reach on-line consumers. In fact, it’s predicted that in 2016, 2 out of every 3 display ads will be programmatic, with audience targeting data at the core of virtually every impression. A new report by BI Intelligence reports that programmatic advertising is projected to account for 50% of digital ad sales by 2018. Marketers purchase third-party data from an external data provider. This provider creates audience profiles informed by external data sources, and then charges a cost per a thousand impressions (CPM) for the use of the data.

An example would be advertising to targeted audience on Facebook. Advertisers can target by demographics, location, interests, and behaviors. An automotive dealer may want to purchase an audience segment of car owners using selects such as make, model, location, and credit score to reach prospective buyers within proximity to the dealership. Or a furniture company can choose to show display ads to new movers within a certain income bracket. A variety of other digital platforms are also used by advertisers, including Twitter, Google, Roku, Dish, and many others.

If you aren’t using third-party data to augment your database, you may be leaving numerous opportunities on the table. By combining third-party data with your first-party data, marketers can better understand how customers behave and engage across online and offline channels. Your internal first party data is the cornerstone of strategic marketing. However, when first party data is used in isolation, marketers only have a partial picture of customers and prospects and cannot fully achieve an integrated customer view to drive future revenues.

To learn how to begin targeting customers and prospects with immediate, relevant content and offers based on data, download this free guide.

Larisa Bedgood
As Director of Marketing for DataMentors, I have a deep understanding of today's data-driven marketing environment, including key components such as Data Quality, Business Intelligence, and Data-as-a-Service (DaaS). I manage and coordinate all marketing functions, including lead generation goals, event and project management, and corporate communications.


  1. Hey Larisa
    Great post! Data is a valuable resource in this digital age, as it is the quintessential requirement for a business to meet its objectives. Customer related data helps businesses to plan its business, marketing and conversion goals as it is the customer who is the end user of the products and services that the business produces or provides.
    Sophia Briggs


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