Data Leakage & How to Keep First-Party Data Away from Competitors

If you harness data in order to inform your marketing, there’s a good chance your competitors have access to it, and therefore your customers. Now’s the time to take back control.

With the explosion of big data and the associated need to manage and analyze torrents of information, data security and governance have become hot-button issues in the business world. In most spheres, data security refers to preventing unauthorized access to and corruption of computers, databases, and websites, and the sensitive information within. In the world of digital marketing, data security is also of great importance—but for slightly different reasons. In this context, data security or privatization refers to employing a “first-party” strategy, wherein a business can be sure that the data they collect stays out of the hands of third parties and, more importantly, other businesses competing for the same customers.

Why Is First-Party Data Beneficial?

To retail and consumer-based businesses that collect and analyze data to inform their marketing, the information at their fingertips is extremely valuable. It acts as direct intelligence into customers’ habits, desires, and behavior, and can be an indicator of which customers are likely to respond to a message, at what times, and on which channels. In this way, collecting first-party data (information collected directly from the consumer and for the sole use of the collector) can act as a huge competitive advantage in a world hyper-saturated with digital marketing messages.

How Is Data Leaked & Shared?

Collecting first-party data opens the digital door for anonymous third parties including data re-sellers and even competitors looking to utilize in-market data for their own marketing efforts. By deploying scripts (snippets of code that collect data about the users on a website) on a certain website, third parties can piggyback off the user data on that site. They can then either sell this information to other advertisers or use it to drive those users to their own website and business. Whether approved or anonymous, these “piggyback” scripts can cause website latency (negatively impacting Google search rankings), affect compliance with global privacy and governance laws, and ultimately act as sieves leaking valuable information about your customers.

In First-Party Data Collection, Sharing Is Rarely Caring

Unintentional sharing and leakage of data have become commonplace to the degree that companies with insecure digital assets often find themselves unknowingly buying their own data back on the open market twice or more in order to get users back to their website. It is astoundingly easy for businesses to lose their data to the open market if they don’t have sufficient control of their digital assets—and as soon as it enters the open market, it is bought, sold, and used to steal customers from competitors’ businesses.

Below are the data ecosystems of several automotive websites. In the worst example, you can see just how many scripts are typically firing on a website of a business that doesn’t have a data privatization strategy in place. Conversely, two additional sites exhibit what good and excellent data governance strategies yield.

Excellent: This is a view of a corporate website. Notice that the scripts firing on the website are very minimal.

Good: For this dealer, the amount of scripts has increased; however, these scripts are authorized and approved.

The worst: This dealership is suffering from the number of scripts that live on their website. This digital ecosystem is not sustainable and forces the dealership to share and leak data to competitors looking for in-market data.

How to Keep Data Away From Third Parties

There are several ways to help keep your assets secure and your first-party data privatized:

Centralize First-Party Data

A great way to start securing the data you collect is to make sure it doesn’t live as open code on your site. A data management platform (DMP) collects and stores all first-party data, organizing it in a way that makes sense for your business, and creating a central data warehouse. Utilizing a DMP allows you to distribute your time among other tasks with an efficient, localized data management process.

Manage Scripts Online with a Google Tag Manager

Google Tag Manager (GTM) is a free tool for managing marketing and tracking tags on your site. Tags (or scripts) are snippets of code that are placed on a website that enables third-party tracking, analysis, and reporting. GTM allows you to control who has access to your accounts, safeguards your scripts within the confines of a transparent system, reduces the potential for mistakes and scripting errors on your site, and ensures that advertiser scripts don’t get lost on your site when you move on from a vendor.

Perform Script Audits

Certain scripts can lead to slow web page operation due to latency and other performance issues. Aside from blocking these scripts from firing outright, continual assessment of which vendors are deploying scripts across your digital properties (using tools like Ghostery), as well as analysis of the scripts themselves, are crucial efforts that afford you insight into your customer experience online.

A solid first-party data governance strategy can give a business a leg up in their industry by ensuring valuable information about its customers stays out of the hands of competitors. If you’re looking for a partner who can help manage data collection, analysis, deployment, and privatization, contact us today.