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Find the balance of personalisation & privacy

16th Mar 2022
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Any modern business needs to have a deep understanding of its customers – and collecting data about those customers and the way the interact and consume services online has always been key to achieving that. However, with increasing legislation such as GDPR and e-Privacy, organisations must put the rights of the data subject at the centre of their approach.

Increasingly, companies must balance their drive for personalisation with the requirement for data privacy protection. Ultimately success comes down to trust and reciprocation; customers will be more receptive to sharing information with a brand that they trust and respect. So, organisations and marketers must ensure that they deliver an enhanced experience in return for collecting data. 

Understanding customer comfort levels

Customers now expect, and many welcome, a higher degree of personalisation. They want the businesses they are dealing with to understand the context of their interest in a product or service and when they might be interested in buying. Essentially, they want organisations to be aware of their preferences and needs. 

Yet, at the same time, customers are increasingly wary of handing out their private information to companies. And this is particularly true if they don’t have a strong existing relationship with them, or if they’re unclear what the data is going to be used for. They recognise the benefits of personalisation, but they don’t want to be followed across the web and subjected to increasingly invasive surveillance just to build an advertising profile. 

Many vendors have adopted the “track everything” approach whereby they capture “everything” out of the box for easy and quick analytics in case the data is useful down the line. However, there is a growing antipathy towards third-parties and middle-men that track people across websites and brands, so companies need to look at alternative methods of data collection. For example, one of the key drivers of dissatisfaction with Facebook (or Meta) is that the level of data capture built into Meta's products is much higher than that necessary to provide the service. This same sentiment will be reflected across businesses worldwide.

Changes to third party data tracking

Issues with third party data tracking will be further exacerbated in 2022, as new data privacy rules and regulations play out and existing preferences become increasingly strict.  The continued roll-out of Apple’s App Tracking Transparency (ATT) framework, together with Google's commitment to phasing out third-party cookies by 2023, is changing the data privacy landscape. 

ATT forces apps on Apple devices to ask your permission before tracking your activity across other apps and websites. In recent times, other tech companies have made moves to limit cookie tracking. Mozilla’s Enhanced Tracking Protection (ETP) 2.0, for example, is addressing redirect tracking in Firefox by clearing cookies and site data set by known trackers every 24 hours.

Google’s latest commitment will mean businesses will be forced to put new plans in place to understand and engage with customers. This will include a renewed focus on collecting first party data and building more direct data relationships with customers via loyalty programmes, intelligent products and risk reduction. 

Getting personalisation right

Given consumer sentiment and the evolving privacy landscape, retailers and marketers will need to balance personalisation with privacy protection. More broadly, 2022 will see a change in emphasis from understanding customers better to understanding customers ‘well enough’, or at an appropriate level to the customer's expectation of what is necessary to provide the service.

Any company that continues to use and rely on third-party web analytics solutions will face difficulties with digital marketing, marketing attribution and personalisation in the long-term. In line with this, forward-thinking organisations are already taking steps to build their own first-party data pipelines.

The first step to success is to take ownership of their data and data processing infrastructure. This means defining what data they want to capture about their users and the responsibility to ensure that that data is only used in ways that are clearly understood by the organisation and its customers. It also means considering what third parties they are willing to share data with and why. 

Second, organisations need to ensure they are in control of where their data is stored, who has access to it and what it’s being used for. For example, customer support teams will need access to specific customer data to serve customers, but product teams do not necessarily need individual user data – they could understand the effectiveness of a new feature by analysing cohorts.

Transparency is key

It will always be hard for organisations to define clear boundaries between personalisation and privacy as comfort levels will differ between individuals. However, in general as long as the customer experience is improving, customers tend to be fairly relaxed about how trusted brands collect data and how much. 

Organisations need to guard against delivering approaches that might be considered intrusive while at the same time being open with customers about how their data is being used. Every company should reassess its data collection and reporting approaches to check if they need to track personally identifiable information, and if so, how much is really needed to derive valuable insights. 

Most concerns around data collection are about how personal data is being collected. Customers realise companies are collecting information about them but they have no idea about what subsequently happens to that data. The key for businesses is to reverse this trend and this means marketers and the businesses they work for being honest and transparent about the data they are collecting, how it is being collected and how it is being used. 

Wherever possible, businesses should engage their customers in an ongoing conversation that helps to build trust. They should emphasise that they are not relying on third parties or dishonest data collection; educate their users and customers on their options and customise their data collection to match their preferences. 

Progressive organisations are already building data capabilities that will help protect them against future changes to online privacy rules – and allow them to continue delivering a relevant, personalised service to their customers and users.  And with the right behavioral data platform, organisations can continue collecting data to build a deeper understanding of each and every customer, while also tailoring their services to provide the personalised experience today’s modern consumer craves.

 

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