Why zero-party data will reshape advertising in the post-cookie era

Billy Murray, senior manager of product marketing at Jun Group, on the power of zero-party data in a privacy-first future.

Everyone with an internet connection tells a common story: the ad that convinces them their phone is listening. It’s the ad that seems to follow them everywhere — social media, websites, streaming. Occasionally, the story ends with a purchase. But more often than not, it ends with feelings of uncertainty and apprehension, no matter how much us ad tech folks try to rationalize what went down.

The comforting news for consumers is that the digital advertising industry is changing. Impending cookie deprecation and signal loss will nearly annihilate this profound level of tracking. For advertisers, this means they need new ways to reach their audience, for better or worse, without forfeiting the relevancy that consumers have grown accustomed to.

Enter zero-party data: the foundation of consent-based advertising, where consumers are in control, and advertisers gain richer insights.

So, what exactly is zero-party data?

Zero-party data encompasses any information that customers willingly and purposefully offer to a brand or company. These insights are typically gathered through surveys, feedback forms, interactive tools, or quizzes, offering brands direct access to consumers' preferences.

A notable example is Gap’s ‘What’s Your Size?’ widget, where customers provide details such as age, weight, and height, then select a well-fitting shirt from a list of competitors. Others include Yelp, which asks about dining experiences upfront, as well as TikTok, which populates surveys between posts.

Unlike first-party data, its consent-based counterpart, zero-party data is volunteered by consumers. First-party data is collected passively from website, app, or content interactions. What sets zero-party apart is the ability to directly ask consumers about their interests, shopping habits, age, health conditions, income, and more — eliminating the creep factor because people opt-in to share insights.

Building stronger relationships with consumers

US data privacy rights have catapulted into the mainstream conversation in the states like California, Virginia, Colorado, and others have responded with new regulations, with more expected to follow suit. At the federal level, the American Privacy Rights Act (APRA) was recently proposed, which if passed could require opt-in consent from consumers for ad targeting, similar to Europe’s General Data Protection Regulation (GDPR).

“It is slightly unclear, but I think at minimum, it requires opt-in consent [from consumers],” Lartease Tiffith, executive VP for public policy at IAB, told Ad Age, “but even more, maybe even a total ban on the ability to have cross-site tracking and web browsing data being shared, and used, for targeted advertising.”

Likewise, targeted advertising is scrutinized by a significant portion of consumers. A survey conducted by Jun Group revealed that 75% of people believe advertisers need to be more transparent about how their data is collected and used. Earlier research from eMarketer suggests that 66% of consumers feel ads that follow them around the internet are “creepy,” while Pew Research found that 79% of Americans are concerned about the way companies use their data.

Zero-party data, on the other hand, gives consumers control and transparency over the ads they encounter. Consider this: a consumer opts-in to an app survey asking if they’re planning a vacation to Mexico. They answer “yes,” and next time they open the app, they see ads featuring the latest deals on flights and hotels for their destination.

For consumers, the experience is relevant, and they understand why they’re getting the ad. For advertisers, the audience is current, unambiguous, and reliable. The use of zero-party data fosters a mutual respect between consumer and brand, one that has the potential to transcend advertising’s long standing reputation problem.

But can this strategy scale?

Zero-party data and AI: A winning combination

When zero-party data first surfaced, it was collected and acted upon one-to-one: the consumer provides a response and relevant content is returned. While effective, this approach isn’t scalable enough to meet the vast audience needs of large advertisers.

But with the growing adoption of artificial intelligence (AI) and machine learning, scale is no longer a limitation. Advertising platforms that have a direct connection to the consumer, such as software development kit integrations, can deliver thousands of surveys daily. And each one can be customized for a specific brand, catering to as niche or broad an audience as desired.

These insights serve as powerful seed data sets for lookalike modeling, where AI identifies common attributes to develop precise and predictive consumer profiles in real-time, and cookie-free.

The outcome? A scalable targeting solution rooted in consent that unites privacy with personalization.

Navigating the cookieless future

With cookie deprecation looming, it's natural to feel a sense of worry, whether you're a brand, publisher, or tech company. As an industry, we’re navigating uncharted waters, with various emerging technologies vying for adoption.

Yet, in the midst of this transformation, the growing popularity of zero-party data signifies a fundamental shift towards a more transparent relationship between brands and their audience.

Simultaneously, the story of the creepy ad is evolving too. Instead of invoking feelings of surveillance, zero-party data can transform the narrative into a testament to the power of choice. As we say farewell to cookies and cross-site tracking, we’re entering a new era of advertising — one grounded in trust, respect, and transparency.

And in the future, when consumers tell this version of the story, I’d bet it more often ends with a purchase.

Interested in learning more about zero-party data? Contact Jun Group today.