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BizReport : Advertising : October 30, 2019


How to use data to encourage customer trust

At the heart of every advertising strategy is data, but consumers have become increasingly worried about how their data is collected, stored, and then used. This can make it hard for brands to build a solid data strategy that leads to better created and targeted ads. We asked a digital expert how brands can better use data to build trust.

by Kristina Knight

Kristina: How big a factor is data to brands' advertising strategy?

Chris Slovak, VP, Tealium: Consumer data can be collected digitally through the brand website and apps, or more traditional routes like in-store purchases, service visits or even call centers. Anytime the consumer (or prospective consumer) 'touches' the brand, there is an opportunity to collect information. Brands that aggregate these touchpoints can use the information to improve the customer experience (not just to sell more) and create a value exchange with their customers.

However, when collecting data brands should always remember that customers come first. That's why it's imperative brands communicate to customers, clearly and transparently, the benefits they can provide by way of their data. When customers opt in to email newsletters, for example, they should be given a jargon-free explanation of how their information will be used and the deals or exclusive offers that may follow. This value exchange summary helps the customer understand what they gain by trusting you --and by extension, any ad partners you may have --with their information.


Kristina: Is there a difference in what consumers expect from data privacy and the actual regulations governing the collection and use of customer data?

Chris: The government has heard the concerns of consumers when it comes to the way brands collect and use their data and are in the process of making great strides to allow full visibility and give total control to consumers. In fact, there are currently 17 state provisions that appear in comprehensive privacy statutes broken into two categories - consumer rights and business obligations.

The truth is, more data privacy regulations are inevitable and brands need to future-proof themselves. Between GDPR, CCPA and highly publicized data breaches by big-name companies, U.S. consumers are aware, and sometimes concerned, of the data privacy landscape more than ever before. And while consumers know, and voice the desire for appropriate data privacy, they simply don't have the time to educate themselves. Businesses' data practices in general are mired in long, jargon-filled documents that are both hard to read and confusing to the average consumer.

Through these continuing regulations, consumers will gain citizens' access, transparency, and consent surrounding their personal data. In addition, the trust associated with data privacy has gained so much clout that it's now a competitive differentiator for companies. Simply put, if a customer doesn't trust your brand with their data, they likely aren't going to trust your product or service.

These regulations will require brands to become more deliberate in their data collection practices. It is the responsibility of the brand to educate consumers, manage and communicate data privacy practices and protect consumer data. Therefore, businesses must be transparent in the ways they are collecting and using data - electing consumers to share more data which will result in a better brand experience.

Kristina: How can businesses build complete customer profiles without infringing on consumers privacy?

Chris: There are several approaches that brands can take to ensure they are not infringing on consumers' privacy, but the most important thing is to always be completely transparent. If a brand begins explaining to consumers how their business handles customer data and this makes them uncomfortable, the company likely needs an adjustment in both mindset and practices.

Brands need to explain the 'why'. Companies should strive to tell consumers the story of how the brand is using their data to create a relevant brand experience - whether it's to constantly improve individualized playlists or generate better product recommendations. By making this known upfront, consumers are more than likely to share more data with a brand to create a more unique experience.

This can be achieved by rewriting consumer-facing privacy and data usage policies. Consumers would rather companies explain their practices in concise, straightforward language.

Lastly, organizations should make sure they have a holistic view of the organization and ensure data isn't siloed in different departments - which could create a data security risk. Brands must create individual, comprehensive customer profiles for the dual benefit of a unified consumer experience combined with a lower risk of mishandled data.

Kristina: With the EU's GDPR, the new California policy, and the upcoming PSD2 changes, how should businesses begin changing how they collect and analyze customer data?

Chris: Under CCPA, GDPR, and other potential regulations, such consumer transparency will be the letter of the law rather than the exception.

With GDPR already in effect and the Jan. 1, 2020 deadline for California Consumer Privacy Act (CCPA) on the horizon, businesses should be proactively taking steps to securely, ethically and legally handle this data. But their efforts shouldn't be in response to any one regulatory act. The entire organization should work with internal IT and legal teams to make sure their people, processes, and technology are part of a responsible framework for managing customer data as they realize how critical it is to the business success as well as being a conduit to brand trust.

At a very basic level, organizations should be able to answer four questions about what's happening with their consumer data:

● What is being collected?
● Are customers giving consent?
● Can they request what's known about them?
● Can they ask for that data to be erased?

Everyone within the organization should understand the intent behind your data practices.These conversations also are an opportunity to take inventory of all the data points the brand currently collects and weed out what isn't needed. This way, when regulatory requirements do come into effect, there is less of a scramble to clean up practices.

In addition, several companies simply lack a good technology foundation for being good stewards of customer data. Organizations need to invest into central pipeline for all data, one that ensures individual customers can easily request to be forgotten and new information can quickly be added within the system. Companies that proactively prepare their processes, people and technology for better data governance will be watching calmly as competitors rush in the face of coming regulations.






Tags: advertising, advertising strategy, CCPA, consumer data, data strategy, ecommerce, GDPR, Tealium








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