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Future of Data Collection: From Coercive to Consensual to Collaborative

6 minute read
Chitra Iyer avatar
How customer data collection strategies are evolving in a CX-first era.

Marketers care about what data they collect and what they do with it. But ignoring how data is being collected is a missed opportunity. The data collection experience can be a strategic differentiator in a market where everyone is focused on unlocking the value of data after it is collected. 

The privacy paradox is real. A Pew Research study of over 4,000 Americans found that though over 81% of customers feel they lack any control over how companies collect and use their data, only 22% ever read a brand’s privacy policy fully before offering consent or opting in. 

But customer-centric brands understand that it will not always be this way. Research from the book “Customer Data Platforms” found that 80% of customers are more loyal to brands that deliver a more positive data-gathering experience — more transparency, a clear "value exchange," and more control around data-use decisions for customers. 

“Coercive” data gathering approaches like close-ended cookie notices have to make way for “consensual” data collection as consumers become more aware of the implications of data gathering. But the real goal is to make data collection a “collaborative” process with brands and customers working together to co-create the most relevant experiences. 

Let’s take a look at practical tips shared by industry experts to turn permission-based marketing into a CX differentiator.

Build Responsible Data Privacy Practices

The recent report “The Person Behind the Data” concerning consumer perspectives on data privacy suggested that responsible data practices such as data minimization (only collecting necessary data), transparency and control mechanisms, minimal retention period, and not sharing data externally can lead to a 23% increase in purchase intent. 

How companies handle people’s data will have important implications for brand value, trust and preference. Tom Chavez, CEO of data management company Ketch, said customers highly value data dignity. Answering these key questions helps build more responsible data practices.

  • Where (at what touchpoints) is the brand gathering customer data?
  • What data is being asked for?
  • When (at which stage of the buying journey) is it being asked for?
  • Why is it being asked for (what do we plan to do with it)?
  • How it's being asked for. What’s the data-gathering experience like for the customer, and how can it be made consistent with the overall brand experience?

When it comes to mindful data collection, Ryan Stewart, founder of digital marketing agency Webris, suggested assessing every piece of data being collected with three questions:

  • “Which department will benefit from the data?”
  • “What will it do?”
  • “If uncollected, could your brand still operate the same way?” 

Leverage Preference Centers for Collaborative Data-Gathering 

Preference centers are a great way to help customers feel invested in co-creating the design and delivery of personalized experiences. They offer customers clarity and control over what data they want to share at different points in their journey with easy access to opt-down and change preferences. 

Not only will this reduce universal opt-outs, but it will also reduce friction at each data-collection touchpoint. Marketers can stagger data gathering efforts and gradually increase engagement and personalization as the relationship evolves. In an always-connected environment where message-fatigue is very real, Chris Beirne, vice president of sales at preference management platform Didomi, said this can become a real differentiator for brands. 

Tom Leighton, COO of e-retailer Sofary, added that centralizing consent and preference on a single platform helps build trust and consistency, whereas fragmenting it across different marketing systems will disrupt the user experience and leave the brand vulnerable to a compliance violation. 

Related Article: 3 Digital Marketing Tips in a Privacy-First World

Consider Conversational Tools to Gather Zero-Party Data

Data collection systems need to be flexible enough to accommodate customers’ changing needs. Stephanie Shreve, vice president of partner engagement at lead generation agency PowerChord, suggested short question-and-answer interactions with chatbots, for example, to help gather valuable insights within the context of the interaction. All collected with permission from the customer. Such an approach also provides instant feedback that can further refine the experience being delivered in real time. 

Gamify the Experience for Higher Engagement

Bungie, one of the top studios in the gaming industry, employed a powerful tactic to leverage first-party data to elevate the customer experience and promote an in-game event for its video game Destiny 2. The studio tailored year-in-review emails for each player and used tactics such as polling and social sharing to gamify communications while collecting zero-party data in a fun, interactive way.

Learning Opportunities

Alison Lindland, executive vice president, and chief client officer at personalization marketing software platform provider Movable Ink, said the campaign improved churn rates by 46% and led to a 124% increase in click-through rates. A bonus was that some customers who had previously opted out signed back on to receive their year-in-review numbers.

Related Article: Is It Possible to Have Both Privacy and Personalization?

Link Data Usage to Benefits

Transparency may be the first step to good data practices, said Barry Padgett, CEO of enterprise customer data platform Amperity, but it's not enough. If companies prove to customers that there is value in them sharing their data for personalized journeys across all channels, be it apps, websites or in-person, the “Why do they need my data?” turns into “They always know what I want.” 

It’s a win-win because customers can draw a direct correlation between the data collected and the value they receive while brands can laser-segment audiences based on privacy preferences for improved campaign performance. 

On the flip side, delivering experiences and benefits based on data that the customer didn’t explicitly consent to share is viewed as intrusive and creepy, said Taylor Jones, vice president of client success at marketing platform MessageGears. It’s like the old “If you discuss it in front of Siri, you’ll start seeing ads for it” idea. What forward-thinking growth brands do differently, he suggested, is tailor experiences based on customer needs rather than internal key performance indicators and revenue goals.

Vasan Sundar, senior vice president and head of technology at interactive digital agency Razorfish, suggested using tactics that show customers how their interactions and behaviors influence brand experiences, for example, “You might also like this because you watched, liked or bought this.” 

Related Article: Is Less More for Customer Personalization and Privacy?

Elevating Data Collection Through Transparent Opt-Ins

Though opt-in experiences are more transparent today — moving from cookie notices to more purpose-driven permissions and preferences — many consumers still don’t know how their data is being used to drive other types of marketing or promotions, which from a brand’s viewpoint may simply be seen as personalization, relevance or recommendations. Marketers need to better understand how to gain consent for data used across multiple domains, said Jess Jurva, chief customer officer of content marketing platform Conductor.

A more collaborative data collection approach will build brand trust, reduce vulnerability to privacy regulations and improve retention by reducing universal opt-outs. Creating a seamless link between marketing and privacy lets the customer know that you are invested in creating a personalized experience for them while protecting them and their data. 

As the marketing universe becomes pushier, taking consent one notch up to collaboration and co-creation is an attractive idea that can change how customers pick the brands they interact with. 

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