Three Pitfalls marketers encounter when they collect data

It would be a big mistake to assume that consumers are willing to write brands a blank cheque when it comes to the use of personal data. Instead marketers need to work harder than ever to build trust amongst customers and prospects of the brands they represent.

This point was born out last year when Deloitte released its 2016-privacy index for Australia last year.

The conclusion of the study’s authors was very clear – Australian consumers want more than mere convenience — trust is critical.

Only six per cent of those surveyed valued convenience ahead of trust. That doesn’t mean brands can skimp of the experience, rather it indicates that sound data practices are tables stakes – and a minimum expectation of consumers.

According to Deloitte, “Australians, whether millennials or baby boomers, want to be confident that the organisations with which they entrust their personal data are reliable, and that they treat their information with respect.”

The problem for company leaders is that whilst trying to build trust and treat information respectfully, those same consumers have ever-growing expectations about the quality of experiences they receive from brands — experiences that require huge amounts of data managed through very sophisticated systems and demanding real-time responses.

The good news is that consumers have indicated a willingness to engage. Research by Association for Data-drive Marketing and Advertising (ADMA) and GFK in 2014 and due to be repeated in 2017, found that at least a significant minority of consumers recognised the data/value exchange. And these consumers were more open to sharing their information in return for benefits.

However, there was also a sting in the tail “Consumers don’t always trust the companies they are sharing their information with. And, even though they are still sharing their information, they feel somewhat cautious about this, with many consumers only somewhat comfortable sharing their information with companies and with the different ways companies can use their information.”

The study suggested that much of this discomfort was driven by a lack of understanding of what companies do with the information they have.

Ignorance of consumer attitudes to privacy and data protection can create headaches for brands. During a recent round table held by DGA in Sydney, participants identified some typical mistakes brands make.

Three Pitfalls

  1. It is important to collect only the data you need to fulfil the requirements of the consumer at that point of the relationship. Too often, brands treat that first step as an excuse to collect reams of data in the expectation that they will use it in future. Quite apart from creating unnecessary friction in the customer acquisition process, such an approach risks hurting trust at the very beginning of the relationship.
  2. Use personal information to benefit the consumers – but be careful not to cross the line a line that might upset or confuse consumers. Brands need to put themselves in the shoes of consumers and test whether communications are useful and engaging.
  3. In the expanding world of social media and digital marketing, consumers are more educated now about the likelihood that their data will be shared between companies. Again, transparency is critical. The fact that the information is being shared needs to be clear, as does the ability of consumers to make the choice about whether they consent or not.

Consumers have shown a willingness to share data, and they are more educated about its value and utility. The job for marketers is to ensure they not only ride the tide of ever- growing consumer expectations around great experiences, but that they take the lead in their own organisations to ensure the customer voice is heard when it comes to how the data is used and shared.

Find out more in the Art of building consumer trust, a whitepaper from DGA.