Can Data Transparency Help Personalization?

In a time where data security — and consequently, data responsibility – is front-page news, marketers are caught in the crosshairs. Companies are tasked with mitigating skeptical consumer sentiments propagated by the missteps of lesser-conscious brands. Trust is harder to acquire, but more vital than ever before.

Selligent surveyed roughly 7,000 consumers to gauge their sentiment on personalization and data collection. What they found was a divide between the way consumers want to be communicated with, and how comfortable they felt with supplying the personal data companies need to communicate effectively.

“There’s been a very rapid transformation from a lack of understanding of how this data exchange works, to having very high expectations that marketing technology will enable highly-relevant personalized experiences for every consumer,” Nick Worth, CMO, Selligent, said. “Those in the business know they are very difficult decisions to actually deliver, because of the challenges of aligning data, understanding consumers, and the context that they’re in.”

“And then you layer on top of that, this problem that the consumer is reluctant to share some of the data [in light of recent] breaches and scandals, and that makes it all the more challenging.”

Data transparency, or brands making an effort to provide clearer communications and opt-ins for data collection, could help facilitate this growing divide. But how?

The need: Consumers expect customized messaging

Selligent found that 70 percent of consumers want brands to understand their individual needs, and market to them in a way that goes beyond typical demographic segmentation and traditional sale techniques. The willingness to receive marketing communications when data is used to present real-time offers and incentive in scenarios where it’s most relevant. The examples Selligent presented in the survey were geolocation related — like receiving alerts for coupons in-store, or deals as they were headed to the movies.

Michael Osborne, CEO, SmarterHQ, agreed but noted that brands often shoot themselves in the foot when orchestrating these experiences by, essentially, competing with themselves.

“When stores compete with their digital channels, bad things happen for consumer,” Osborne said. “Whether they’re incentivizing you to buy in-store, or they’re overdoing it on coupons to get you to buy online. As a consumer, you might actually get a slightly better deal out of it, but you’re [the consumer] essentially getting hounded by two different organizations that are in [the consumer’s] mind, the same company.”

When you add on the fact that fewer consumers want to provide the data necessary to identify the right channels to create seamless experiences (according to Selligent, only 20 percent of consumers said they willing to give personal information to brands upfront) it can be hard to find the right path to execution.

How data transparency can help bridge the gap

On the flip side, consumers are more cognizant of how their data is handled and more critical of how it’s applied for personalization. Not only that, people now use services like purchasing a VPN to protect their data. The Facebook-Cambridge Analytica scandal surfaced how fragile the data ecosystem can be if third-party data is not handled appropriately. In turn, consumers question whether or not their data is shared (88 percent of respondents expressed concern that their personal data was shared without their consent) and how it’s being used by organizations.

There are several ways transparent data collection techniques can help build brand trust, and strengthen personalization:

Provide clear opt-in programs for customers: This is especially important for brands that need to be GDPR compliant.

“You have to be very clear on what data you’re collecting and how you plan to use it,” Worth said.

Don’t overdo it: Worth stresses the importance of only collecting the data you really need to execute campaigns. It’s easy to turn off a customer by asking for superfluous data — so be strategic.

“Don’t collect any data set that you don’t really intend to act on,” Worth said.

Demonstrate the why: When asking to collect customer data, show how it will benefit their experience. This can be done by offering the right incentive – something valuable.

“You have to be able to ask the consumer, ‘hey, can we look you up — do you want to swipe your loyalty card, and show me what you know you might be looking at, so I can offer you something?’” Osborne said. “The incentive will generally be around offers, or a better experience.  I think consumers are willing to give up data for that. Transparency and GDPR are becoming the norm — consumers are more aware of what could be tracked, and it’s up to them to decide if it should be tracked.”

Keep your promise: Once you’ve earned customer trust, put your promises to practice by creating tailored experiences.

“Consumers are much more willing to talk to a brand that they trust about their preferences,”  [Consumers] like to be marketed to as not as someone who is may have a specific age or gender, in a specific geography, which implies a level of income (I think all of us tend to resent that a little bit) but as an individual.”

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