Data & identity · also called 3P data
Third-party data
Third-party data is information about people collected by companies with no direct relationship to them, then aggregated and sold or licensed to advertisers, often as ready-made audience segments.
Third-party data is gathered by companies that did not deal with the consumers themselves. Data brokers and data providers collect signals from websites, apps, public records, surveys, loyalty programmes and other sources, combine them, and package them into audience segments such as "in-market for a car" or "frequent travellers".
Advertisers buy these segments, usually through DSPs and DMPs, to extend reach beyond their own customers. It is convenient and scalable, but quality varies widely: segments can be based on thin evidence, outdated or inferred, and different providers may label the same person very differently. The IAB Tech Lab's Data Transparency Standard ("data label") encourages providers to disclose how segments were built.
Third-party data has come under the most regulatory and platform pressure. Browser cookie blocking, App Tracking Transparency, laws like GDPR and CCPA / CPRA, and US state data-broker rules restrict how it can be collected and used. Many marketers are shifting spend towards first-party data, contextual targeting and retail media.
Think of it like this
Third-party data is like buying a mailing list from a company that compiled it from many sources; you did not meet these people, and you have to trust the compiler.
An example
A US insurer buys a "recently moved" segment of 2 million users from a data provider at $1.50 CPM on top of media costs, but finds its match rate and conversion lower than its own customer lookalikes.
Related terms
Data broker
A data broker is a company that collects personal information about consumers from many sources, often without a direct relationship with them, and sells or licenses it to others.
Audience segment
An audience segment is a group of people or devices defined by shared characteristics, such as demographics, interests, purchase behaviour or intent, used to target or measure advertising.
DMP (data management platform)
A DMP (data management platform) is software that collects and organises mostly anonymous, cookie-based audience data from first and third parties into segments for targeting programmatic ads.
First-party data
First-party data is information a company collects directly from its own customers or audience, such as purchases, sign-ups, app use and site behaviour, through its own channels.
Second-party data
Second-party data is another company's first-party data shared directly with you through a partnership, such as an airline sharing audience insights with a hotel chain.
Sources: IAB Tech Lab Audience Taxonomy, California Attorney General: CCPA