There’s a tug-of-war going on in marketing today, one that pits the desires of consumers to receive personalized content against the requirements for data privacy by customers and their governments. Truly personalized content is the byproduct of data capture, after all. How can brands strike the right balance?
To start, leaders — especially CMOs — need to evaluate how they and their organizations can become more customer-centric. Amazon is not a fad, nor was L.L. Bean before it. If you are not spending a large part of your day thinking about your customers and trying to understand their motivations and their needs, you will find yourself outflanked by a current competitor or an unknown disrupter. Customer-centricity is the answer to many company challenges and opportunities, and the personalization versus privacy conundrum is no different.
The first step in achieving this delicate balance is to think constructively about what customers want and need from your brand. Typically, most problems with brand-customer relationships are not because of data, technology, or privacy — they are a result of a lack of customer understanding by the brand and an absence of thinking deeply about the possible consequences of an action.
Thankfully, there are ways that brands and marketers can work within this dynamic to provide the most valuable and engaging content to audiences while respecting and abiding consumers’ desire to protect their data, privacy, and right to be forgotten.
The Tipping Point
It can be tempting for brands to take their foot off the gas on personalization initiatives in the wake of increased customer concern and government regulation in response to that concern. Some could read this as the “tipping point” at which personalization — and the data collection that enables it — have gone too far, and they may think that to be a leading brand in this space, you should dial back personalization efforts and instead focus on customer protection.
This would be a mistake. For the past 60-plus years of contemporary direct marketing, customers have rewarded brands that have found ways to treat them more personally. Customers weigh the value of personalization and convenience against data privacy concerns, and so long as the brand adds value to the customer experience, customers will (individually and writ large) make that trade-off.
The second mistake brands can make is slowing down or pausing their marketing technology investments for fear of customer backlash or government regulation. When we see data and technology as a source of a problem, we sometimes dismiss the notion that these tools can also be part of the solution, which limits our paths forward. This can lead us to slow down or pause the development of customer experience platforms, rather than using those tools to implement and enforce guardrails to define what customer data can be used for what purposes. Those that realize that data and technology will be the tools to solve this problem will unlock improved customer experiences while simultaneously reducing privacy risks. This will come in the form of data and technology solutions that allow brands, customers, and governments to have more control over what, when, and where customer data is gathered and how that data is used.
For example, in the case of GDPR and CCPA, there is a requirement for a customer to “be forgotten.” The only way to achieve this at scale will be for brands to build an experience that allows a customer to enter their information, for that data to get back to the brand, and for there to be automated processes working across all of the brand’s operational, marketing, and analytical systems to delete that customer. For brands to comply, they’ll require more marketing data and technology investment, not less.
In fact, brands will need to support multiple customer data policies concurrently (GDPR, CCPA, email consent, ability to use PII or not for analytics purposes, etc.). Data governance and consent systems will need to be built and integrated into every system where a company stores customer information. Will your brand allow customers to be forgotten, but also allow your company to retain the record for other legal purposes (which is permitted by GDPR and CCPA)? Or will you throw out all the data? Will you provide education to customers that by doing this, you will be creating a new customer record for them the next time they engage with your brand, and will you explain the inconvenience that may cause?
Your strategy will depend on what you want to do, but your strategy will be enabled (or constrained) by what your data and technology systems can do.
Stay tuned for part two of this blog post, in which I’ll discuss how to navigate the unique challenges of personalization and how marketers can best prioritize relationships in meaningful ways.