Page 32 - AeM_May_2017

BUZZWORDS

Know the difference between 1st, 2nd,

or 3rd party data?

There are different data types, with different meanings, lasting partnership where data is exchanged. For exam-
that must be handled differently in today’s the digital ple, company A would like to buy the data set X from
economy that collects more and more data. Unfortunate- company B. For company B, this data set X is first party
ly, the terms are often confusing, which is why we decid- data, since the data was collected by the company it-
ed to clarify today the difference between first, second self. For company A, the data set X becomes second
and third party data, since it is crucial to know the differ- party data, since the data was not generated by B, but
ence when planning your data pool for specific cam- has been purchased. Thus, company A is the "second
paigns. party". Such an exchange or purchase is usually not a
problem with general market research data. But when
The terms "first party", "second party" and "third party” dealing with personal data, it can’t simply be assumed
data provide information on where the data comes from, there is sufficient consents to use this data and caution
or who has collected it, from a company's point of view: is advised. If a company buys data, it can always lead
to dependencies or complications with the other compa-
1. First party data has generally been collected by ny That’s why trustworthy partnerships are so important.
the company itself: For example, a company that runs
email marketing campaigns and processes the email 3. Third party data can be helpful but at what price?
addresses, as well as the name and gender of the users, If a company needs very specific data records or a large
as part of the opt-in process. The company has access amount of particular data, it may be helpful to access
to the respective data set at any time and can use the third party data that can be purchased from external
data within the user-consent declaration approved by the sources - which might have also acquired or collected
user. the data themselves. The business model of these ex-
ternal service providers is to collect, aggregate, and sell
Direct control and the independence of third parties are data from different sources.
the main advantages of ‘first party data’. But to enrich
and expand their very own data, companies sometimes A great advantage of third party data is the fast availa-
must resort to data that they didn’t collect themselves, bility and the large amount on offer. However, not only
buying information e.g. from market researchers instead. the costs are affecting the use of such data adversely,
This form of data is called second and third party data, its usage is often also questionable and risky, not only
which should always be exercised with caution as there in terms of quality, but data protection.
is dependency on the provider of this data: Is the data
correct and can be used legally compliant right away, are For this reason, it is so important to stay informed about
usually the crucial questions. the usage rights. ◊
By MediaBUZZ
2. Second party data refers to data obtained from an-
other provider: It can either be a one-time purchase or a

32 May 2017 - (Cyber) Security & Data Protection