IDC predicts that by 2025, 75% of retailers with modern data strategies will improve customer satisfaction by 50% and reduce costs by 25%. It’s because actionable, timely data is the engine behind stronger customer relationships. However, retailers have a harder time meeting rising customer expectations if they rely on guesswork or outdated third-party data. For loyalty to last, they need the right information at the right time.
So which data should retailers focus on—and why?
All data can add value, but how and why they’re collected determines their accuracy, trustworthiness, and personalization potential. That’s why zero-party data (ZPD) is quickly gaining ground.
In the next sections, we’ll explore what sets ZPD apart, how it complements other data, and why integrating it with AI could turn data into a true marketing engine.
Zero-party data: Table of Contents
Understanding Retail Data Types & The Strategic Shift to Zero-Party Data
Each data provides a different perspective on customers, including strengths and weaknesses.
| Data Type | Source and Consent | Privacy and Accuracy | Usage in Retail |
|---|---|---|---|
| Zero-party data | Shared voluntarily and proactively by a customer. | Highest transparency and precision. | Hyper-personalization and tailored recommendations |
| First-party data | Information collected through direct interactions and observed behavior (purchase history, website clicks, app usage). | High; customer is aware data is collected. | Personalization and data driven engagement strategies |
| Third-party data | Often obtained from external providers or aggregators. | Outdated or irrelevant data; privacy concerns | Audience expansion, lookalike targeting, broad market insights. |
Why Modern Retailers Need ZPD and How They Can Collect It
Retailers turn to ZPD strategies not only to understand what their customers want now but to capture unique insights they wouldn’t typically collect. By allowing customers to share lifestyle or preference information beyond transactional data, businesses can gain valuable context that informs personalized experiences and builds stronger connections. This empowers consumers with control over their data while helping brands create meaningful and tailored engagements.
ZPD also keeps retailers compliant with privacy regulations such as GDPR and CCPA, which have made heavy reliance on third-party data far less effective in recent years.
- GDPR, for instance, gives consumers the right to access, correct, or delete their personal data. Something difficult to guarantee when data comes from external aggregators outside the retailer’s direct control.
- CCPA allows consumers to opt out of having their data sold to third parties, undermining data brokers’ ability to maintain comprehensive, usable datasets.
These factors explain why zero-party data is important to retailers seeking to deliver trust, personalization, and compliance.
To obtain ZPD, retailers can:
- Make it a fun experience. Interactive experiences like quizzes, surveys, or polls can make sharing data engaging and feel natural.
- Embed it into the loyalty programs. Incentivize customers to share data by linking it to loyalty rewards.
- Offer incentives. Follow Sephora’s lead and give consumers discounts, promotions, and exclusive access in exchange for sharing their data.
- Use contextual prompts. Request data at the right time during the customer journey.
However, collecting ZPD data is not the end of the story. What retailers do with the information can decide the success or failure of their efforts.
Looking for AI growth strategy guidance?
Retail is evolving fast, so sitting around isn’t an option for your business. Infoverity is here to help you get there, faster and more effectively. 
Book a consultation call today.
Turning Zero-Party Data into Retail Innovation
Valuable customer insights should never sit idle, but many brands fall into the trap of gathering zero-party data without thinking about how to use it effectively for marketing and personalization initiatives.
The real value of ZPD emerges when it’s combined thoughtfully with other data sources, such as:
- Historical purchase behavior
- Browsing patterns
- Broader market trends
When used correctly, their impact on retail promotion and ad scaling is invaluable. Throw AI into the mix, and the insights become tangible through precise personalization, predictive targeting, and timely engagement that keeps customers coming back.
Using Zero-Party Data to Fuel AI for Smarter Upselling
Think of ZPD and AI as having a symbiotic relationship:
- AI needs accurate, context-rich data to personalize effectively.
- Zero-party it’s accurate because it´s voluntarily and explicitly provided by customers—reflecting not just what they did, but what they want next and why.
Together, they transform pushy sales pitches into useful advice.
Rather than an impersonal “You might also like,” recommendations and ads, customers receive a persuasive message that emphasizes their interests: “Since you told us you prefer eco-friendly fabrics, we selected this newly-released organic cotton jacket.”
Here are a few ways retailers can integrate ZPD into AI workflows to deliver highly dynamic personalization across campaigns and channels.
Smarter segmentation
Build a system that leverages predictive AI (predictive analytics and machine learning) to move beyond generic lookalike or inferred segments. Predictive AI clusters audiences based on what customers openly share about their preferences. For example, “vegan skincare,” “running gear for marathons,” or “luxury casualwear.” This approach provides precise, actionable insights that help tailor customer engagement strategies.
Better AI models
AI models become sharper and more relevant when they learn from stated interests rather than only observed behaviors. This is key for providing thoughtful and personal recommendations and relevant ads. AI can, for example, generate ad variations tailored to a user’s style, size, interests, or brand affinities.
Retention and lifecycle marketing
Predictive AI can more accurately forecast churn risk, upsell opportunities, or next-best offers by analyzing customer-stated motivations alongside behavioral history. Timing is key for retailers, as it allows brands to act at the exact moment customers are most receptive. For instance, right after they express interest in a new product, make a purchase, or update their preferences.
Maximize Your CDP Impact with Zero-Party Data
Customer Data Platforms (CDPs) promise improved customer experiences, but pitfalls can hinder success. Brandon Moore, Associate Director at Infoverity, shares his expert insights on building successful CDP strategies, including how zero-party data can fuel personalized experiences.
Dive deep into Treasure Data´s expertise. Read the full article here.
AI-Powered Retail Growth Fueled by Zero-Party Data
Zero-party data offers a privacy-compliant, high-accuracy foundation to help retailers build lasting relationships.
In practice, Infoverity helps retailers:
- Eliminate fragmented data systems and improve data governance to support scalable AI.
- Create AI models that use clear, customer-provided preferences, reducing the need for less transparent, complex models that rely on inferred data.
- Predict next-best offers, identify upsell opportunities, and churn risk with greater precision.
- Achieve measurable outcomes like higher conversion rates, increased average order value (AOV), and increased customer loyalty—all while staying compliant.
Jumpstart Your Zero-Party Data Transformation Today
Retail is evolving fast, so sitting around isn’t an option for your business. Invest in zero-party data and AI-powered growth strategies today, and you’re building a solid foundation for long-term customer loyalty, better marketing, and stronger performance.
Infoverity is here to help you get there, faster and more effectively.
Ready to redefine what’s possible? Transform customers insight into a growth machine with Infoverity. Talk to us today.
