The missing piece in your data puzzle: Declarative data to unlock your growth
In the realm of data, 3 main categories shape our understanding:
- 1st party data: Also known as declarative data, primarily sourced from the customer directly.
- 2nd party data: Also called behavioral data, based on customer behavior observation.
- 3rd party data: Referred to as enrichment/supplementary data, provided by external sources like Facebook, Google, etc.
The current state of things
Most businesses today are heavily relying on 2nd and 3rd party data while almost ignoring the potential of 1st party data.
Keep following this approach may provide reliable insights, but it misses the human element that makes a lasting impact, drives growth, and help companies to convert from just big companies to legendary products, like Airbnb.
As our world moves online with ginormous steps, 1st party data becomes the key to understanding customers on a personal level and creating personalized experiences that help you to activate most of the incoming users, by providing the right product experience to cover their jobs to be done.
The Problem: People, not numbers
Products whether it is a restaurant, hairdryer, or an online service are made for people. People are simple beings and tend to use different tools (products) to solve different problems, whether it is to be less boring on the weekend or fix health issues.
This is called 🎯 intent. A reason behind their first engagement with your product. Those people also have a certain 👀 expectation of your product — to receive education and guidance, to get a better price, or to experience a certain service in a certain way. Finally, all of those people have some
🌍 background, perhaps they have already tried to solve this problem with another product, who knows?
The most interesting part is that 1 product could have a few completely different groups of customers with different 🎯 intents, 👀 expectations, and 🌍 backgrounds.
By tapping into the goldmine of 1st party data, you can bridge the gap between your product and your customers’ intent, expectations, and background.
🔥 Imagine discovering where your ideal, highly motivated customers are coming from. Wouldn’t that make your life easier, with marketing costs going down and product usage (activation, engagement, retention) surging up? 🚀💰📈
Unfortunately, many companies overlook 1st party data, focusing solely on numbers instead of people. This leads to misalignment between the product and customers, resulting in a lack of growth and eventual failure.
Beyond 2nd and 3rd party data: The Power of Declarative Data
Behavioral data alone isn’t enough to fully understand customer needs. It provides insights into customer interactions with a product but doesn’t reveal their underlying motivations or problems.
Declarative data, on the other hand, provides information about customers’ preferences, needs, and problems, helping to understand the root causes of their behavior. Embedding declarative data captures — such as smart, dynamic onboarding, or in-product surveys — into your product can help to tailor your product to meet customers’ real needs.
Behavioral data tells us 🎬 WHAT customers are doing, while declarative data tell us 🧩 WHY they are doing it. To truly understand customer needs you need to collect both and use them together to inform product development and power up your acquisition, activation, engagement, and retention strategies.
A customer viewed through the lens of 2nd and 3rd party data is just an anonymous mass. However, observing them from all dimensions reveals unique individuals with distinct needs and backgrounds.
I recently bumped into a picture on LinkedIn that perfectly exemplifies this idea, and I couldn’t help but appreciate its accuracy!
Would you try to acquire, activate or even sell your services to these 2 individuals the same way? I guess the answer is no. But, when you look only at 2nd and 3rd party data you do approach them the same way.
How to get declarative data right?
So, how do you harness the power of declarative data? Surveys are a good start, but you need to go further. You need to have declarative data captures. Sounds easy, but in reality, it is quite complex. It is more of a wholesome data analytics platform, that allows you to combine 1st party 2nd party and 3rd party data.
I’ve built such a platform for a few companies already and while it brings colossal results it takes a lot of time and money. Now I’m working on a standalone product that will allow every company, despite the budget to harness the power of 1st party data.
But before that, as I said earlier, it is always good to start with a simple survey to capture initial 1st party data about your customers. Here are a couple of tricks:
Here are key elements that make declarative data extremely insightful and actionable:
- ⏱️ To get quick results I usually advise using Typeform
- 🎯 Design your questions around customer Intent, Expectations, and Background (Examples here)
- 🗣️ During my experience, I have noticed that communicating the goal of your survey to your customers is the key. Tell them why you need this data and how it will be beneficial to their experience
- 🎮 Feel it as of personalization step in a computer game. How your customer will personalize their character will impact how they will end the game (be successful with your product)
- 🚦 Customers experience the highest motivation to use your product at the very beginning. That’s why it’s a good idea to ask your customers questions about themselves early on in the product when they’re more likely to answer and give high-quality responses. I ideally suggest putting declarative data capture during sign-up/onboarding.
Finally, don’t forget to
- Segment your customers based on your 1st party survey data
- Enrich user entities with the following attributes and
- Pass this data to your data warehouse, or any product analytics tools, such as Mixpanel, Amplitude, etc.
Good luck and have fun!
