Advertisers, websites and data brokers are having a ball with your data.
The Breakdown on Your Data
First-party data is the data you give away willingly to websites. Advertisers and publishers can extract and compile data by requiring you to register online and by then analyzing your activity.
Example: your email address, name, pages you like, ads you click, etc.
Third-party data is information that’s collected by an entity that doesn’t have a direct relationship with consumers. This data is normally compiled by specialist firms who pay websites to collect information about their visitors. This data is then used to piece together detailed profiles about users’ tastes and behaviors as they browse the Internet.
Example: an advertising tracker will place a cookie on your browser and see where you go so you see ads for things you want. (Maybe those shoes?)
Second-party data is the newcomer to the scene. It is essentially first-party data that another party obtains directly from the source. This data isn’t given away directly—it usually is obtained through a direct relationship with another entity. Deals can be made between publishers or a Data Management Platform (DMP). Or simply between two parties who could benefit from each other’s first-party data.
Example: a pet store sharing data with a veterinarian, who both have similar clients.
The Wider Scope of Your Data
Collecting and dealing with all that information requires a wide range of different players. Data brokers earn their living by helping advertisers and publishers manage their own first-party data, as well as selling them more data about users.
“Companies stress that they do not know users’ names. But they identify them by numbers, and as they build up detailed profiles about those numbered users, there is concern that the information might be traced to individuals.”
– The Economist
All this data is divided into segments defined by location, device, marital status, income, job, shopping habits, travel plans and many other factors. These segments are then are then auctioned off to buyers of ad space in real time.
While data sharing can lead to products and services that make your life easier, more entertaining, economical or even informational, it is important to be aware of your data. So, whether it’s your first-, second- or third-party data, it is important to understand where your data goes, and how it is used.
Sources
http://www.economist.com/news/special-report/21615871-everything-people-do-online-avidly-followed-advertisers-and-third-party
https://hbr.org/2015/05/customer-data-designing-for-transparency-and-trust
https://www.wired.com/insights/2015/03/internet-things-data-go/
