In 1949, William “Papa” Barnard introduced Ohioans to the Vita-Mix blender via television. The 30-minute program, which you can still watch on YouTube, is widely regarded as the first “infomercial.”
While this longform advertising format is still in use almost 75 years later, we don’t see nearly as many infomercials nowadays. The Slap Chop and ShamWow two-minute TV demos, now a decade old, were some of the last TV spots to go mainstream. Consumers today are more likely to find product-focused videos on Tik Tok and YouTube. Once a go-to marketing tactic, infomercials are sliding out of the proverbial frame.
We’re seeing a similar decline in the use of third-party data. Privacy regulations like the Digital Markets Act in the European Union have spurred massive changes in data sharing and targeted ads. For example, Google is now making over 20 modifications to its search platform in Europe to comply with regulatory policies. Marketers, brand managers, and CMOs find themselves scrambling to adjust as third-party data loses relevance.
As such, first-party data—information collected directly from customers with their explicit consent—is emerging as the preferred solution. But gathering first-party data can come with high costs and challenges.
Costs of First-Party Data
In response to this shift, publishers have begun charging a premium for their first-party data offerings. Digiday reports that publishers are charging advertisers at least $2 above standard CPMs for access to data and contextual targeting.
Across industries like luxury and entertainment, even higher rates may exceed budgets - especially when data costs can constitute 50% or more of a campaign's total media spend. If a premium on data doesn’t yield better performance, marketers cannot justify the additional costs.
The Push for Data Ownership
Some companies are taking a proactive approach to data ownership by acquiring their own first-party data. Longstanding platforms are positioning themselves as vendors. For example, PayPal has entered the advertising space with PayPal Ads, leveraging its vast trove of 400 million users and 225 billion transactions. They hope to deliver insights that will redefine digital advertising.
Because building expansive new infrastructure isn’t always a realistic solution, many companies turn to tried-and-true engagement strategies to collect first-party data. Tactics include interactive content - games, surveys, quizzes, contests, and giveaways - that are designed to offer something valuable in exchange for opt-in customer info.
Sweepstakes as a Solution
Sweepstakes and promotional campaigns, in particular, provide a low-barrier incentive for customers to share their information and build excitement around the brand. They strike the perfect balance between engaging consumers and acquiring first-party data. These campaigns often rely on several channels to entice consumers and serve as an integral part of omnichannel marketing efforts.
Because participants voluntarily opt in to share their information, and as long as terms and conditions are made crystal clear, brands ensure their practices meet standards for transparency and consent.
The Future of First-Party Data in Marketing
The digital marketing landscape continues to evolve as privacy regulations grow stricter and publishers charge higher premiums for customer data. If brands want to stay competitive, they need more efficient ways to build relationships with their consumers. Sweepstakes have emerged as one outstanding solution.
By leveraging contests to collect valuable insights, marketers can allocate budgets more effectively, reduce their reliance on costly external data sources, and create personalized campaigns that deeply resonate with their target audiences.
Every generation of marketers faces some kind of seachange in the face of innovation. The infomercial pioneers of yesteryear had their moment. Then digital marketing took over. Now it’s digital marketing’s turn for rapid transformation. Smart brand leaders know that first-party data is the new holy grail.
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NOTES:
As personalization and privacy battles continue between Google and world governments - especially in the European Union - Google continues to make changes to its platform. 20 new modifications were just just announced to Google in Europe.
As a result, the use and reliability of third-party data is diminishing for marketers. More and more, they’re turning to first-party data to guide their campaigns. The problem is that for brands looking to get their hands on more first party data, the costs can run high. Media companies aren’t always able to sell their data due to the higher costs they’re demanding.
A $2 premium on a CPM can be very expensive for some advertisers’ budgets. And the data’s usefulness depends on whether a brand’s goal is to drive direct response.
Brands also are skeptical of how the data has been procured, complied, and if the media companies have the right to sell it at all
When data starts to become 50% or more of the actual total media spend, brand managers have a hard time justifying the cost. They want to see a 20% improvement in audience quality if they’re paying a 20% premium for data.
Most advertisers are still relying on cookies. But things will eventually change for publishers’ first-party data and contextual targeting capabilities.
https://digiday.com/media/media-buyers-dont-want-to-pay-extra-for-publishers-first-party-data/
Some companies are taking an even more aggressive approach - acquiring troves of first-party data through acquisitions and innovative product launches.
https://www.emarketer.com/content/first-party-data-reshaping-marketing-landscape
PayPal just launched its own advertising platform at Advertising Week New York. This is PayPal's entry into the competitive digital advertising space and will take advantage of its huge user base and transaction data.
As third-party cookie policies change, brands are seeking more control over their data usage to pave the way for targeted marketing, insights, and personalization.
https://www.emarketer.com/content/paypal-unveils-new-advertising-platform
A more efficient way of gathering first-party data is running sweepstakes and promotional campaigns. More than just accumulating data, they also help build loyalty with current and new consumers of the brand.
