In a digital economy, data is one of the world’s most valuable resources. The revenues of data-driven titans like Google, Amazon and Facebook are a testament to this.
Today’s customers expect convenient, hyper-personalised experiences as standard – and we have data to thank for that. Collecting and using information about customers’ needs and behaviours enables businesses to craft experiences that deliver exactly what the customer is seeking.
But does customer data have a place in small business strategy?
In short, absolutely.
Although you may not have the capabilities to collect, organise and use terabytes of information like the global tech giants, you can still use data to make informed business decisions and provide a great customer experience.
What is first-party data and why is it more important than ever?
First-party data is a game-changer. It’s the information you collect directly from customer interactions on your platforms, encompassing demographics, purchase history and web activity. This data isn’t just high-quality, it’s precise and entirely relevant to your offerings, giving you a competitive edge and ensuring a consistent customer experience.
With the deprecation of third-party cookies, first-party data has gained even more importance. Encouraging customers to share their information through forms, registrations or other means is essential for delivering a seamless, cookie-less customer experience. Collecting first-party data responsibly and effectively is a key strategy for achieving improved customer loyalty, engagement and long-term success in today’s competitive marketplace.
Customers have evolving expectations. They demand personalisation in exchange for their data. Respect for privacy is paramount, especially in a world with stringent privacy regulations. By acting on first-party data and going cookie-less, you not only cater to customer desires but also build loyalty and retention.
First-party data has numerous applications:
Personalisation: Go beyond basic greetings to offer personalised web and mobile experiences based on customer behavior and preferences.
Advertising: Create highly targeted ad campaigns that appeal directly to your audience, such as customers who’ve bought a particular product or those interested in specific events.
Predictive Analytics: Use customer behavior patterns to predict their next actions and tailor your approach accordingly.
Audience Insights: Analyse groups of customers with similar traits and adjust content and offerings to match their interests and needs.
This is why it is more important than ever to collect first-party customer data directly from your website.
So, how do you collect first-party customer data?
Before we get into the nitty-gritty of what to do with your customer data, let’s look at how to collect it in the first place. Some of the most common ways of capturing first-party customer data include:
Lead capture/sign-up forms.
Having a sign-up form on your website is a great way to not only generate leads for your business but also capture valuable information about your typical customer base, such as:
- Contact details
This kind of information is essential for forming a comprehensive picture of your target customer.
Surveys are useful for directly asking customers for information. You can use them to collect either quantitative data (for example, a score out of 5), qualitative data (for example, a written review), or both.
Most email marketing platforms have in-built analytics capabilities allowing you to analyse which customers are most engaged with your business (i.e. they regularly open emails from you) and which are falling behind.
Social media analytics.
Like sign-up forms, social media analytics can tell you about your audience’s demographics and interests – as well as provide insights into the effectiveness of your social media marketing strategy.
Google Analytics is primarily used to track the performance of your website, including page views, duration of visits, return rate and bounce rate (how many visitors navigate away from your site after viewing only one page). On top of that, it can tell you where your website visitors are coming from (geographical location) and the types of products/services and content they’re most drawn to.
Running competitions is a good option to engage your audience and compel them to provide their details. Data is typically captured through a sign-up form asking for their contact information and anything else you’re interested in uncovering, such as their interests or how they found your business.
A customer relationship management (CRM) system.
CRM systems are designed to consolidate customer information in a single database that you can easily update and manage. With a CRM system, you can collect and manage end-to-end customer communications in one place, and learn more about what customers want and how they interact with your business.
Best practices for first-party customer data collection and management.
1. Decide on what you really need.
Most small business owners have one thing in common: they’re time-poor. The reality is you probably don’t have a lot of spare time to be trawling through mountains of customer data every day. With this in mind, focus on the information that will be most useful to your specific business.
2. Be secure.
When you gather personal data about clients, it’s important to have a plan to keep that information safe. Most popular third-party platforms have robust security measures in place, but if you’re exporting that data to use anywhere else, make sure it’s stored securely and encrypted wherever possible.
3. Be ethical.
4. Invest in a CRM system.
As mentioned, a CRM system is incredibly handy for collecting and managing data in one place. Depending on the platform you choose, you can collect information directly via the CRM, import data from multiple sources, or both. This makes managing your data much more streamlined.
What does a CRM system do?
A complete CRM system does two things. Firstly, it keeps all your customer information in one spot. This includes:
- Contact details
- Service history
- Invoices paid and unpaid
Secondly, it delivers one simple platform to communicate to your customers from. This includes:
- Email marketing
- Appointment reminders
Using a CRM template to compile customer data is also a good starting point if you’re new to the world of CRM and looking for a quick solution.
Once you get the hang of compiling and analysing simple customer data, you can import your database into a more sophisticated CRM platform with additional tools, like marketing automation and lead management.
6 ways to make the most of your first-party customer data.
So now you’ve got a handle on how to collect and manage your customer data, what should you do with it? Here are six ways to leverage customer data to grow your business.
1. Improve your products or services.
Customer data in the form of surveys, feedback and reviews is invaluable for figuring out how to make your products or services even better. For example, if you’re consistently receiving similar feedback about a particular service you provide, you can use that information to make adjustments and provide a better experience for your customer base.
You can also use customer data to identify the most engaged or relevant customers to ask for feedback about new products or services.
2. Uncover your customers’ pain points.
Even if you’re already providing a great product or service, chances are your customers are facing other challenges that you have the ability to solve. Collecting feedback about your customers’ pain points can help guide you in the right direction for expanding your offering and creating a data-driven business roadmap.
3. Offer personalised recommendations.
Analysing customer data such as email open rates, website traffic, enquiries and more is useful for targeting customers with customised offers and the right deals based on their preferences and browsing habits. On the flip side, if your data tells you customers aren’t responding to your offers and deals, it could be a sign it’s time to try a different approach.
4. Improve your customer service.
Customer feedback from surveys and reviews is critical for continually improving your customer service strategy. Using this data, you can pinpoint areas where your approach is lacking and make changes to provide a better experience. This could include adjusting your message to customers before or after a sale, introducing new customer service channels, or training staff on best practices.
5. Create engaging content.
Insights gained from your customer data are valuable for understanding the content that resonates with your audience. What do they want to know about? What are they engaging most with? Where are they dropping off? Answering these questions using data is an important first step in knowing what works and what doesn’t, and how to adjust your content strategy accordingly.
6. Improve your customer journey.
Data enables you to delve into the behaviour of customers across multiple channels and find out where roadblocks may be stopping people from converting.
For example, your analytics might reveal that, although the majority of your customers open emails from your business, many quickly drop off once they click through to your website. This could suggest that your website layout or content needs to be revisited. By using data, you can refine your customer journey and help ensure more prospects turn into paying customers.
Collecting and organising customer data is important. But the real value lies in knowing how to leverage that data to provide a better customer experience, improve your products and services, and ultimately, grow your business.
Thryv is one of the best marketing automation platforms available right now, with everything from CRM tools to social media, review, and scheduling tools to bring everything together under one simple and straight-forward umbrella.
Get your demo to give Thryv a whirl and make running your business that much easier.