Marketers' Love-Hate Relationship With Preference Centers

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Marketers' Love-Hate Relationship With Preference Centers
Marketers' Love-Hate Relationship With Preference Centers

Marketers have a complicated relationship with preference centers. While some marketers swear by them and leverage the data collected from them, others consider preference centers a nuisance for customers and argue that consumers often don't update their settings. Loren McDonald, VP of industry relations for digital marketing technology provider Silverpop, an IBM company, spells it out clearly: “People love them, hate them, believe in them, [and] don't.”

To help shed some clarity, here are six preference center pros and cons that marketers should consider—no matter which side of the fence they prefer.

Preference center pros

Boosts brand loyalty and affinity. In today's competitive environment brands need to do everything they can to create customer experiences that will distinguish them from their rivals. Through preference centers customers can note such items as preferred topic areas and communication channels, which then enables marketers to improve message content and timing, craft unique experiences, and garner brand loyalty, notes Sheila Colclasure, global public policy and privacy officer for Acxiom, a data and analytics company. “The preference center is a way to begin having deeper, richer dialogues with your customer,” she says.

Colclasure notes, however, that if brands solicit customers' data, then they need to hold up “their end of the bargain” and put that information to good use. Marketers who ignore preference center data risk leaving money on the table, as well as increasing churn and tarnishing customer-brand relationships, Silverpop's McDonald adds.

Sets realistic expectations. Preference management can help marketers get a clearer view of their programs' true conversion metrics, says Sang Woon Heeringa, director of global marketing for Dell. For instance, a marketer may run an email campaign targeting 1,000 customers to promote his company's latest product. But if the preference center data reveals that only 800 people of the target group want to receive communications via email, and that just half of that 800-customer segment wants to receive product information, the probable target becomes smaller, Heeringa explains.

Provides a stepping stone for progressive profiling. Instead of assuming what customers want, marketers should simply ask, argues Jake Sorofman, research director for analyst firm Gartner. Asking customers what they care about creates a foundation for data-driven marketing, he says, and leads to progressive profiling in which marketers exchange value for deeper understandings.

Preference center cons

Not popular with consumers. Consumers are inundated with pleas for their attention from brands, work colleagues, and friends, Sorofman says. So getting consumers to care and take the time to provide their preferences can be challenging. “There has to be some level of awareness and interest before someone is going to engage with a preference center,” he says. Furthermore, many companies don't promote preference centers, Silverpop's McDonald notes, making it difficult for consumers to find them and tailor their experiences.

Burdensome to customers. The goal of a preference center is to collect data from consumers, and then use it to create more relevant, enjoyable experiences. But some customers may not make the effort to fill out multiple fields. Acxiom's Colclasure advises marketers to make preference center experiences as seamless as possible for consumers by avoiding visual clutter, hard-to-read language, and overly long questionnaires.

Maintaining preference centers alongside other Web updates can also be taxing for marketers, McDonald points out. To ensure that data is collected properly he suggests that marketers test preference center links and pages every month.

Difficult to measure ROI. Isolating preference centers' impact on ROI can be tricky for marketers, McDonald admits. Although reductions in email frequency may not seem to correlate to direct sales, metrics such as a reduction in opt-outs as a result may show a connection. McDonald urges marketers to look at preference centers' long-term value, such as the lifetime value of consumers who don't unsubscribe.

Another way to better understand preference centers' ROI, he says, is to have different preference centers for different marketing goals—such as one that provides options for reducing email frequency when consumers click to opt out of a specific email list.

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