Amid the ongoing digital revolution, businesses often find it difficult to gather accurate data necessary for offering personalised products and services.
This challenge forces them to resort to acquiring large, aggregated datasets from unreliable or third-party sources, resulting in inaccurate targeting, less effective product development, and poor customer engagement strategies.
However, the growing adoption of zero-party data has altered this landscape of data sharing, enabling individuals to alleviate the issue by giving them the power to control which types of data they share with companies, ensuring their privacy and preferences are safe and respected. Organisations, on the other hand, benefit from receiving highly accurate and reliable data from individuals for more effective research and development as well as targeting.
For UpTech Media’s latest exclusive interview, we sat down with Glenn Gore, chief executive officer at Affinidi, to deep dive into the intricacies of zero-party data and its role in fostering trust and transparency in data exchanges between individuals and brands. This encompasses addressing data privacy concerns across businesses and organisations, along with the corresponding risks, opportunities, and benefits that come with it.
Understanding zero-party data as a key to consumer insights
When discussing zero-party data, Glenn explained that it involves data collected directly from a brand’s consumers through an interaction. According to him, it includes the information that the consumer intentionally and proactively shares with a company or brand in exchange for a specific value or benefit, such as personalised offers and services.
While consumers are generally aware that this data is being collected, they may not know what it is used for or may not actively provide it. Glenn elaborated on this concept, citing an example of an individual visiting a travel website and inputting his travel preferences for destinations and hotel amenities.
In his example, he explained that first-party data was already collected when the individual provided his details upon booking a trip, and the travel company recorded these booking details. The data acquired from this interaction is accurate based on the original interaction and has been consented to for use.
The direct line of communication enabled by zero-party data collection allows businesses to make smarter decisions and personalise experiences that resonate with consumers, boosting satisfaction and fostering loyalty. This contrasts with the less reliable insights from passive browsing or third-party sources.
“In essence, zero-party data isn’t just about collecting information; it’s about building a trusted, transparent relationship with consumers, positioning it as a gold standard in a world where personalisation and privacy increasingly go hand in hand,” added Glenn, explaining the nature of zero-party data.
More than being highly accurate, zero-party data respects user privacy and aligns with rigorous data protection laws like GDPR and CCPA. This alignment not only curtails the risk of fines and other legal headaches but also lessens the need for businesses to seek out external, often unreliable data pools.
Meanwhile, second-party data enters the picture when the company shares this information with another company, often under agreement. Glenn emphasised that for this transaction, consumers may have yet to consent or be aware that their data is being shared.
Additionally, data collected by companies that do not have a direct relationship with the individual is called third-party data. Most often, these are aggregated from various sources and sold to other companies for advertising and marketing purposes. Glenn further shared that individuals typically do not consent to this data collection, and the accuracy of such data may be inaccurate.
Safeguarding data in the age of privacy concerns
With data breaches eroding across the landscape, Glenn believes that ensuring the security and integrity of consumers’ data is highly critical in the context of zero-party data collection.
“Any high-profile hacks or accidental data leaks will undermine consumer and business confidence and strain the bonds of trust between customers and businesses,” he said.
As a result, he urges organisations to implement stringent data management and security measures to align with laws like Singapore’s PDPA. These measures include the deployment of top-notch cybersecurity protocols, staff training, and adopting transparent data practices with clear customer controls on data use and consent.
He further advises businesses to move with caution while striking a balance between personalised services and data protection. This entails collecting only essential customer information through zero-knowledge-proof methods to minimise data exposure and maintain consumer trust.
“This delicate balance is crucial to enhancing user experiences without unnecessarily intruding to preserve privacy and trust, and to achieve this, businesses should integrate a holistic identity framework within their technology stack.”
As a tech leader empowering data owners to reclaim their privacy, Glenn also enumerated various ways in which organisations can strengthen their cybersecurity measures. These include strong encryption methodologies, cryptography applications, and modern public key management systems to safeguard data and transactions from breaches, unauthorised access, and other potential cyber threats.
Advanced methods such as zero-knowledge proofs (ZKP) can decrease the risk of security breaches by allowing businesses to validate essential information without accessing unnecessary details.
“This approach reduces the data shared, minimising the damage from potential breaches, thus lessening the attractiveness of being targeted,” said Glenn.
He also asserted prioritising decentralisation innovations, given their nature to inherently mitigate various threats by design, providing them with higher data security. “By leveraging the distributed nature of technologies from the decentralised realm, they can implement a multi-layered defence strategy to protect their customers’ data comprehensively.”
Moreover, Glenn mentioned that OpenID for Verifiable Presentations (OIDC4VP) and Verifiable Credentials (VC) are among the technologies within the family of decentralised identity management technologies that businesses should also consider.
He further notes, “These solutions will empower businesses with versatile applications, grant customers and end users’ greater data control, and ensure verifiability and security across different systems.”
Driving innovation, productivity, and efficiency through zero-party data
When asked about leveraging zero-party data to expand Singapore’s digital economy, Glenn explained that direct and consensual data collection through zero-party data strengthens customer relationships and improves trust and loyalty.
More specifically, he said, “Customers who are actively asked for their preferences are likelier to engage with brands that respect their data choices, enhancing both customer satisfaction and brand reputation,” said Glenn.
In this sense, zero-party data enables businesses to craft efficient, highly targeted marketing campaigns that resonate deeply with the intended audience. This precision in marketing efforts ensures that messages are more effective, and advertising spend is optimised, reducing waste on poorly targeted initiatives.
Talking about regulatory compliance, on the other hand, leveraging zero-party data is particularly beneficial as it aligns with stringent privacy regulations and ethical data practices, given that zero-party data is provided voluntarily. This helps businesses navigate the complex regulatory landscape more effectively.
Glenn also clarified that the adaptability provided by zero-party data allows businesses to stay agile and responsive to changing consumer preferences. This ensures businesses’ personalised services and products remain relevant over time.
He adds, “The insights gained from zero-party data also enable businesses to identify new areas for expansion and innovation by understanding detailed consumer preferences and demands. Doing so would allow them to uncover untapped market segments or develop innovative product offerings, driving growth and enhancing competitiveness in the market.”
On top of these advantages, Glenn reminded organisations to be more aware of the challenges associated with managing large volumes of zero-party data. This encompasses investing in robust data management systems to securely and efficiently process and analyse information.
According to him, continuous engagement with customers to update and validate data is crucial to keeping customer insights relevant and actionable. “While zero-party data is collected with consent, businesses must use it ethically and transparently, always upholding their customers’ trust, to continue growing this healthy data exchange,” he explained.
Securing data in the dynamic tech environment
As the current chief executive officer at Affinidi, Glenn shared that the tech evolution is a significant force in their industry. According to him, it drives the company towards greater data privacy and user control.
In particular, he notes, “Our focus towards zero-party data approaches and decentralised systems is critical to meeting our security objectives and central to our mission to revolutionise data control.”
He also elaborated on the crucial role of emerging technologies in enhancing security measures and fostering a trust-based relationship between businesses and consumers.
By doing so, he emphasised how integrating solutions with the Holistic Identity architecture into platforms is vital, given that the company both responds to market demands for greater privacy and control and shapes an industry standard that prioritises ethical data practices.
Glenn highlighted that the said commitment is not merely an operational goal; it’s a value proposition that defines their brand and sets the direction for the industry’s future.
He further adds, “Through Holistic Identity, we empower individuals to have autonomy over their data, breaking new ground in cultivating innovations that develop more personalised user experiences and additional value by enabling them to exchange personal data for value.”
“We’re excited about how these advances can revolutionise data usage, enhance brand development, and create highly personalised experiences grounded in consent, transparency, and trust,” said Glenn.
Looking ahead, he believes that achieving the era of enhanced data sovereignty will require whole-of-society efforts from both businesses and individuals to develop trusted and privacy-first exchanges. With cyber threats looming, Glenn concluded, stating, “The proactive integration of holistic identity solutions will reinforce and bolster global industry defences.”
