The Power of Zero & First-Party Data

8 case studies across big tech (Spotify, Google, Pinterest) and startups (Famous Birthdays, Parade, Jones Road, etc.) to understand and creatively leverage your data. This is the future of marketing, customer retention, and virality - make more $$$ from your new & existing customers.

Author

Meagan Loyst
August 28, 2023

Welcome back to Meagan’s Newsletter: The Gen Z POV, where I break down trends, industries, and tech with a Gen Z lens every other week. I’m Meagan and I’m so happy you’re here. Today we’re diving into the power of zero & first-party data… an area I think is highly under-appreciated but can unlock so much value for brands, creators, startups, and beyond.

Personalization is the name of the game for any company touching the consumer experience — almost to the point of anticipating what products I should be buying, songs I could like, etc. In some ways, companies like Spotify and Amazon know me better than my friends and family… and it all comes down to the data that I provide (knowingly or subconsciously) by using their services.

First, I’ll use Spotify to break down first-party vs. zero-party data — both come directly from consumers/customers, but are achieved in different ways. Think Spotify Wrapped, your personalized playlists, and everything that makes your Spotify… YOUR Spotify.

Then we’ll dive into other tangible examples of first-party & zero-party data being leveraged to create magical experiences, viral products, and customer loyalty:

  • First-Party Data, Search as a Superpower: How Famous Birthdays leverages 1st party data to discover creators before they become big, like Addison Rae at 300k followers (now 88M on TikTok) & Charli D’Amelio at <1M followers (now 151M on TikTok), and make $$$ doing it. Plus insights on how Google & Pinterest leverage their 1st party search data to create viral products.

  • Zero-Party Data, The Power of Quizzes & Creative Experiences: How startups like Topicals, Parade, and Vacation built 10k - 80k person waitlists pre-launch by creating quizzes & experiences to collect emails. Plus why Jones Road Beauty’s directs all their paid traffic to a customer quiz (and how it’s improving every metric across the board as they scale to $60M in revenue).

If you’re a big brand or company thinking about this, please reply to this email! Now… let’s get into it! ⬇️

Spotify: First-Party vs. Zero-Party Data

Leveraging data creatively can create serious loyalty with your customers, thus increasing spend & making it easier to launch personalized experiences. This is the future of marketing, customer retention, and virality.

Soooooo wtf is zero-party data? First-party data? And why should I care?

Spotify collecting & leveraging both first-party AND zero-party data to make $$$.

Zero-Party Data: This is when an app/company will ask a consumer to answer questions in order to understand their preferences — think Spotify directly asking me to rank my Top 5 Taylor Swift albums for their “Top 5” marketing campaign. This is typically collected via quizzes, surveys, polls, loyalty programs, etc.

  • Use Case: Spotify leveraged my zero-party data to sell me a Speak Now shirt because I actively listed that as my Top Taylor Swift Era/Album in their Top 5 experience. They’ve been testing new commerce features for top fans in the past few months, a new monetization engine that could boost their top line revenue.

First-Party Data: This is when an app/company will collect information from their customers behaviors on their site or app — like listening data in the case of Spotify. Another example of this could be purchase history for an eComm company. They don’t often share this data as-is, but can leverage it in powerful ways.

  • Use Case: Spotify Wrapped (find out how big of a fan you are of your favorite artist, how much time you spent listening to music, the songs you loved most), personalizing playlists based on the artists/songs I listen to (“Uniquely yours” & “More of what you like” section), and experiences like knowing your Top 5 by Listens.

Snippet of my Spotify Wrapped from 2022, leveraging my 1st party listening data

Every company should be thinking like Spotify — collecting new data from customers in creative ways (ie: Top 5) and leveraging existing 1st party data to build loyalty (ie: Spotify Wrapped) and monetize by launching new products.

First-Party Data: Search as a Superpower

If you spend any time in Gen Z world or on TikTok, you’ve probably heard of Addison Rae — she’s one of the most followed people on TikTok with 88M followers and a true breakout star: landing movie roles in Hollywood, launching her own brands, and now a music career.

How she was “discovered” with only 300k followers is an even better story… and it all leads back to a site called FamousBirthdays.com and their brilliant use of first-party search data ⬇️

The story of how TikTok breakout star Addison Rae (88M followers) was discovered

The LA Times described it best above, but the first interview request she ever received was from Famous Birthdays when she was an up-and-coming creator with 300K followers… before the massive brand deals, before the agencies, and before the fame. They did the same thing with Charli D’Amelio, conducting her 1st ever interview before she hit 1M followers (now the 2nd most followed person on TikTok with 151M followers).

And it all comes back to 1st party data 👏 👏 👏

Famous Birthdays is organically visited by 25 million users monthly, with most people coming to the platform to learn more about their favorite creators and celebrities.

And what’s the first thing you do when you land on FamousBirthdays.com? Head to the Search Bar and look up either (a) the creator you were curious about or (b) your birthday to see which celebrities might share the same one as you. The search engine on Famous Birthdays is searched over 10 million times per month, and each celebrity and creator on the platform is ranked entirely based on user activity.

This means that every day, week, and month, Famous Birthdays KNOWS before everyone else who’s becoming a breakout star — they see the upticks in interest first-hand by the changes in search behavior on their platform.

The home page for FamousBirthdays.com on August 25th (ranked by user activity)

And what’s really cool about this data is that it’s real-time AND platform agnostic… thus, not limited to social channels or even purely digital ones. Take a look at Margot Robbie’s Famous Birthdays search data — her growth wasn't on socials, it was at the movies! Their data treats movie theaters, Netflix, Spotify, Instagram, TikTok, YouTube, Twitch, and podcasts all the same.

And Famous Birthdays monetizes this data! Famous Birthdays has been around since 2012, but launched their PRO platform in 2020 to help companies leverage their first-party insights — they have major social networks and talent agencies as paying customers.

And this makes SO much sense. Let’s say you’re an up-and-coming brand looking to work with influencers. It was waaaaay more affordable to do sponsored posts with Addison Rae when Famous Birthdays spotted her, the same way it was more affordable for a beauty brand to get featured by Alix Earle in a GRWM video a year ago than it is today (where she charges upwards of $70K per ad). The same is true for talent agencies who want to be first to spot up-and-coming talent… so they’ll pay for that proprietary data to find the breakout stars.

By just looking at a site like Famous Birthdays, you might think it sounds silly — just people looking up their favorite celebrities to know when they’re born. But behind the scenes, they’re a data powerhouse.

So TLDR, search can create a massive first-party data advantage for companies — both to monetize and glean interesting insights about their core customers (ie: Gen Z’s favorite creators) and the world around us.

Two other examples I’ll call out in the world of search:

  • Google’s Year in Search: This is a great example of creatively leveraging search data to create a viral product, similar to Spotify Wrapped except more focused on collective insights vs. personalized behaviors. Google’s Year in Search video/film goes viral almost every year (it’s typically very emotional & representative of the human experience), and also features interesting insights around Google Trends.

  • Pinterest Predicts: Pinterest breaks down the Top 27 emerging trends based on search activity on their platform — look how similar their interface is to Famous Birthdays, with the search bar being the primary action encouraged by the site. Their trends report is hyper-specific (ie: dog pool parties on the rise, along with sci-fi outfits and floral baked goods) and allows users to filter insights by audience, brand values, and categories.

Pinterest’s home page… very similar to Famous Birthdays with Search at the center

With TikTok emerging as the new “search engine for Gen Z” and AI-based platforms like ChatGPT and Claude on the rise… I’m excited to see how these companies create similar campaigns that deepen loyalty with their customers and share insights with the world.

Zero-Party Data: The Power of Quizzes & Creative Experiences

In this section, I’ll share a few examples of viral launch and retention strategies from startups I admire like Topicals, Parade, Vacation FM, and Jones Road Beauty… all leveraging zero-party data in creative ways to kickstart their growth or increase LTV.

Building a Viral Waitlist Pre-Launch

Topicals is one of my favorite Gen Z brands — it’s a Black-owned beauty brand that targets chronic skin conditions, and they’ve been on a tear since they launched in August 2020 with a 10,000 person waiting list and $2.6M in VC funding. Last year they were the fastest growing skincare brand at Sephora (!), and raised another $10M to fund their growth.

The start of their success story was this 10,000 person waiting list, built through a customer quiz called “Skin, Sun & Stars.” Their launch had to be pushed back because of COVID delays so they got creative to get in front of customers — tying in astrology, an understanding of their customer’s chronic skin conditions, and dedication to mental health advocacy ($1 donation to Sad Girls Club for each quiz submitted) all in one quiz. In return, customers got a fun skincare-based horoscope (every Gen Zers dream) and social sharing is inherently built-in.

Topicals’ Skin, Sun & Stars viral launch quiz that landed them a 10,000 person waitlist

While Topicals created a formal quiz to build their email waitlist to 10,000… that’s not the only way to go about it! Parade & Vacation FM created fun user experiences to build demand (and collect emails).

  • Parade’s Spin 2 Win & Press Here for Stickers (80k Waitlist): Parade is re-writing the American underwear story for Gen Z with an emphasis towards inclusivity, body positivity, and sustainable materials — for context, I buy from Parade on the reg & love their drop-first model (ie: Coca Cola x Parade, Juicy Couture x Parade). They were able to build an 80,000 person waitlist before they launched in 2019, with their fun Spin 2 Win campaign being one of the primary drivers — “Spin to win a free pair when we launch. Share with friends and we'll donate $1 to Planned Parenthood of NYC for every friend you invite.” Another was “Press Here for Stickers,” an online game where you get free stickers, sending out over 15,000 stickers before they launched.

    Source for Topicals & Parade stats: Aja Singer’s incredible newsletter!

  • Vacation (10k Waitlist in 2 days): I vividly remember when Vacation (Poolside FM’s first product, an 80s themed sunscreen brand) launched on Twitter in April 2021. I wasn’t sure exactly what the brand was or what they were selling (music? products?)… but the vibe was cool, it was everywhere, and I wanted to be part of the action. You submitted your email address and in turn received business cards with spoof job titles like “Karaoke Mic Stand Operator” and “President of The Pool Bar”. Mine was “Journalist Assigned to Mini Bars” and they still leverage this in the marketing campaigns they send me today, two full years later (see below). After the viral launch, Vacation started taking orders a few weeks later and very quickly surpassed 6 figures in sales, offering their “employees” 48 hours early-access to the website & a 10% discount.

    Viral launch of Vacation sunscreen, although hard to tell what they’re selling!

Boosting Customer Loyalty

Quizzes & gamification can be impactful when you’re launching your brand, but also as you’re scaling your brand. Enter Jones Road Beauty & the way they leverage Octane AI, a zero-party data marketing platform for e-commerce.

I learned all of this from my friend Eli’s newsletter who’s the Senior Director of CX & Retention at Jones Road Beauty — he outlined exactly how (and why) they leverage these zero-party quizzes during the customer journey. And it seems to be working… JRB did $20M in sales in 2021 (their first full year in business) and was on track to triple in 2022.

Their quiz helps new customers to find the perfect shade across a variety of JRB products (you can try the quiz here), and every single paid ad that JRB runs includes a link to the quiz’s landing page. It allows them to better personalize touch points with their customer in the long-run — personalized product recommendations, tailored email marketing campaigns — to increase conversion rates, upsell to customers, and improve a bunch of metrics (AOV, LTV, customer satisfaction, and NPS score).

“Just about every metric across the board has been better for customers that have gone through our quiz, which is why we direct all paid traffic through the quiz, as well as send customers there via email and sms.”

Eli Weiss, Senior Director of CX & Retention at Jones Road Beauty

The first question in the Miracle Balm quiz created by Jones Road Beauty

My two cents: Data has been a buzzword for like a decade now, but I think we’re just starting to scratch the surface on creative implementation of both collecting & leveraging that data — especially zero-party. I expect to see more of these personalized quizzes and experiences out in the wild: at sports games, at concerts, on university campuses, in fashion, and beyond.

If you’re a company or brand thinking about ways to turn up the heat with your own zero or first-party data strategy, please email me! I’m at [email protected] & I LOVE this stuff.

And as promised, here are a few things (tech, culture & life) I’m intrigued by at the moment.

  • Tech: The TikTok Livestreams are getting crazy with a capital $ 🤑. The NPC trend where TikTok creators go on a livestream and pretend to be video game characters in exchange for gifts/tips/money is making creators THOUSANDS of dollars — this (below) is what the livestreams look like. Nicki Minaj did one this past week and supposedly made $100k+ in an hour?! And future ones could 2-3x that. Absolutely nuts.

  • Culture: THE DRAMAAAA. Justin Bieber, Ariana Grande, AND Demi Lovato are all leaving their manager Scooter Braun (aka Spider Boy… iykyk). Karma really is a relaxing thought for Taylor Swift this week… long story short, your nemeses WILL defeat themselves before you get the chance to swing.

  • Life: Finished The Summer I Turned Pretty Season 2. It’s a show I love to hate & hate to love… Connie baby? 9 Taylor Swift songs (including exile!!!)? It’s fun to see a new teen drama take the world by storm & everyone collectively get into it. I watched it solely b/c of FOMO — was seeing it everywhere and didn’t want to miss out on the fun.

    • Also have been super into long TikTok breakdowns from an up-and-coming creator named Milo with 36.2k followers (like the rebranding of Addison Rae & what is a “f*ck ass bob”). Calling it now, she’s gonna be big — love the way she identifies topics, and her long form analysis (no seriously, like 10 minute videos on TikTok).

    • And my video of the week is this one of a tornado that perfectly encapsulates Gen Z humor with 9M views, 2.4M likes, 231K saves, and 297K shares. Please listen to the sound on full volume (note: explicit) and read the comments… you can thank me later. “OK IM ABOUT TO DIE BUT WHY IS THIS TORNADO LOWKEY SERVING”