The sharing economy makes goods and services accessible without the burden of ownership. Advertisers have followed suit by creating data pools that allow brands to access unique buyer information from other companies. In a recent article for The Drum, Adam Berke (@adamberke) discusses how data co-ops offer digital marketers a competitive advantage.

Why data co-ops are effective

Data co-ops allow marketers to share their anonymized customer data in order to access the data collected by other companies. This allows marketers to get access to new audiences that are most likely to convert.

Marketers traditionally deliver ads to a target audience based on third-party data, which is the presumed characteristics or behaviors of people they think are most likely to buy. Advertisers participating in a data co-op can access first-party data and create a target audience based on demonstrated behavior.

Berke explains that “shared co-op data is used to feed statistical models that analyze buyer purchasing patterns and target new customers who are likely to be interested in your product.”

Growing first-party data can be challenging for startups and young businesses. Even established companies can benefit from diversifying their audiences to reach new potential customers. Entrepreneurs must adopt the most effective marketing strategy to grow their brand identity and ensure sustainable revenue. Data co-ops offer a collaborative approach that can help marketers place their content in front of the right viewers.