Knowledge is power. To be a successful independent agency owner, the more knowledge you have, the better you can make smart business decisions. There are two types of data: third-person and first-person. Companies used to collect and rely on third-party data, but things are about to change. First-person data is the future.
Third-Person vs. First-Person Data
When we talk about using data, we typically refer to first-person and third-person data.
First-party data is collected directly from your clients via websites, social media, paid advertising, transactions, and other agency-owned data sources. This data is proprietary, requires user consent to collect, and gives you a detailed insight into your clients' demographics, psychology, and behaviors.
Sources of first-party data include:
- Website Activity
- Email Engagements
- Sales Calls
- Purchase History
- Client Reviews and Feedback Programs
- Social Media Interactions
Third-party data is collected and purchased from public sources that do not directly relate to your clients. While first-party data is individual, third-party data is an overview, generated and analyzed as a collection from multiple users.
Where third-party data can be beneficial is competitor research, deep dives into specific behaviors and demographics, general industry research, and gaining access to consumers interested in your services but have yet to land on your website, social media, or advertisements.
Consent to Collect Data
Because so much emphasis is placed on privacy, particularly when it comes to online activity, new rules and regulations are making it easy for users to opt out of data tracking and sharing. Collecting third-person data is becoming more challenging and more unreliable.
Depending on the source, third-party data may or may not have consented to collect the data. Consent aside, third-party data is not specific to your clients or agency. It is a generic collection of information, not always accurate, and shared with anyone willing to pay.
Data Security
While you have explicit consent to collect first-person data you have to ensure that you are taking every step to protect client data. Transparency is key to clients trusting you with data, including the personal and financial information that you collect.
Every independent agency owner needs to invest in cyber insurance and follow best data security practices.
First-Party Data Is More Reliable
Focusing on first-party data collection to inform your marketing and business strategies will yield better insights and results for an independent insurance agency owner.
First-party data is a much more reliable and better use of your resources. Data comes from internal sources and is specific to clients interacting with your agency. You'll be able to see who is interested, relevant demographics, psychographics, and behavior.
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