Whatever your industry, you\u2019d be hard pressed to find anyone who doesn\u2019t say that customer data is important for business. Yet few are realising its full potential \u2013 or properly managing the reputational risk it presents.<\/p>\n
In our experience-driven economy, data is the most important ingredient for crafting deeply personalised experiences and delighting customers. Yet the companies most notorious for enabling this \u2013 including digital platforms Facebook and Google \u2013 are in the spotlight after an official inquiry was launched by the ACCC. The inquiry will examine how these platforms gather information about consumers and use it to target them with highly personalised advertising online.<\/p>\n
Many marketers may worry these developments present a Catch-22 for their work. How can businesses meet these competing demands for more personalisation and more privacy?<\/p>\n
As a starting point, it\u2019s safe to assume a few things. Managing customer data will become an increasingly critical trust point in any business relationship and doing so effectively will only get harder the longer you leave it. Yet the rewards for businesses that get it right will far outweigh the difficulties in doing so \u2013 and it\u2019s best to start early than risk getting caught out.<\/p>\n
It\u2019s clear that consumers are increasingly recognising the power of data and are far more educated on its impact and value. They\u2019re also far more critical of companies they think manage data badly. In fact, among Australian consumers, a whopping 78 per cent believe companies aren\u2019t taking adequate steps to protect their personal data, according to Deloitte\u2019s annual Media Consumer Survey. Close to nine in ten (88 per cent) say they strongly value privacy over convenience, according to a survey by Privacy Australia.<\/p>\n
To address this shift, governments around the globe are setting new standards for how businesses can use customer data, from 2018\u2019s General Data Protection Regulation (GDPR) in the EU to Australia\u2019s Notifiable Data Breach Scheme, which requires entities to notify individuals and the Information Commissioner about data breaches that are likely to cause \u201cserious harm\u201d.<\/p>\n
The ACCC added to the debate with last year\u2019s review of loyalty schemes, such as
\nfrequent flyer, supermarket and hotel loyalty programs, calling on businesses that offer them to improve both their data practices and how they communicate with customers, to help consumers understand how these schemes operate.<\/p>\n
Now it is doing so again with its announcement of two new inquiries into possible anti-competitive behaviour by digital platforms, and services allowing online advertisers to target Australian internet users.<\/p>\n
The good news is it\u2019s easier than many businesses imagine. Start by offering customers transparency and control of their own personal data. Not only will this give customers a better understanding of your data practices but it can also let them define their own experiences, which builds trust. There\u2019s no better partner to businesses than an informed, empowered and data-driven customer.<\/p>\n
To achieve this kind of partnership, businesses can no longer offer vague language and promises as to what they will give in exchange for personal information. Consumers want and need to know, in the simplest language possible, exactly how their information is being used.<\/p>\n
Businesses should speak directly to customers as individuals, giving them confidence that they are actually a part of the process of building better experiences. In retail, for example, this could include asking for location data in exchange for push notifications alerting customers to a sale if they approach their favourite store.<\/p>\n
It\u2019s a simple shift, but one that eliminates doubt and treats customers as partners.<\/p>\n
One of the major global regulatory changes around consumer data revolves around the channels and methods we use to ask for information. Under GDPR, companies with complex, multi-page user agreements can now receive a hefty fine.<\/p>\n
Consumer data protection laws are as unique as the regions they cover, but a common goal is to create more transparent relationships between brands and customers. Giving customers the ability to pick and choose what they sign up for and which brands they engage with is an important sign of respect.<\/p>\n
Whether it\u2019s the \u201cexplicit consent\u201d requirement of GDPR or the \u201cright to opt-out\u201d requirements that other global initiatives include, the underlying regulatory trend is clear: give customers the explicit ability to pick and choose what they sign up for, which brands they engage with, and the specific manner in which they wish to be engaged. Make it easy to find, simple to access, and fast to change.<\/p>\n
That includes regular \u2013 proactively shared \u2013 options to opt-out if they have been
\nstuck on an email list for five years.<\/p>\n
Another emerging trend is the creation of a centralised, intuitive portal through which customers can manage their own data. Think of it like settings on your phone. Customers would get the ability to turn specific levers on and off depending on the brand they engage with.<\/p>\n
While these rights vary depending on the specific regulation, the common thread is clear: this is the new standard. Making it a key part of your customers\u2019 experiences will show that you\u2019re taking their data as seriously as they do.<\/p>\n
The global conversation around data has evolved significantly in recent years. From hacking and data breaches to exceptional data-driven customer relationships, personal information has become the foundation through which brands either succeed or fall short. With increasing scrutiny, such as the ACCC\u2019s latest probe, you should expect the way you handle data to become increasingly visible, whether you are ready or not.<\/p>\n
Brands can stay ahead of customer expectations and build trust by putting customer needs first, setting the highest possible bar for transparency and giving customers control and choice when it comes to their personal data.<\/p>\n