Companies of all sizes face a key challenge, or balancing act perhaps, when it comes to the gathering and handling of customer data. How can they ensure data privacy while also delivering valuable personalized experiences?
This issue is complicated by both the growing number of data privacy regulations around the world as well as an ever-increasing amount of available customer data provided by more and more digital touchpoints. At the same time, many companies struggle to control all of that customer data, which may be stored in silos across their organizations rather than in a centralized and therefore easily accessible and governable data layer.
As companies look to target prospects and engage with existing customers, they now rely primarily on the first-party data which those users have provided during website visits, through the use of mobile applications and via other connected devices through the Internet of Things. The goal in harvesting all this information is to personalize and improve the quality and speed of customer experiences so they become more relevant and helpful to the individual customer.
Build Trusted Customer Relationships
While many customers may be willing to share information with companies such as their email address and shopping history, perceived misuse of that data can have serious consequences for ongoing relationships with a brand or a company.
These conclusions are borne out in researchtitled, “The 2017 SAP Hybris Global Consumer Insight Report” which surveyed more than 20,000 consumers in 20 countries around the world, including 1,000 U.S. consumers. Among the U.S consumers, the SAP study found that 71 percent of those polled were willing to share some of their personal information with brands. However, 79 percent of the U.S. survey respondents would not use a brand again if that company had used consumer data without the customer’s knowledge.
With a spate of recent massive data breaches – including the most recent news from Facebook – every customer on the planet has become keenly aware of the potential for their information to be misused. A company’s ability to demonstrate transparency around its customer data practices therefore may be a key differentiator in a customer’s decision to choose or remain with a particular brand.
Customers want to engage with companies that they can trust to look after their data and to respect their preferences around how that information is used.
Use Regulation as a Way to Rethink Data Privacy Practices
Customers’ increased concerns about data privacy has led to the growth in increasing amounts of data privacy regulation on a local, national and regional basis. For example, the European Union’s General Data Protection Regulation (GDPR) is a major push to establish a standard for customer visibility into companies’ data gathering and usage practices.
For some organizations, the response to compliance with regulations like GDPR is akin to a band-aid or a quick fix to paper over underlying issues with data privacy. However, given that GDPR is only one in an upcoming series of new data regulations around the world, a much better approach for companies to adopt is to look at the regulations as a way to reimagine their core response to data privacy.
To do this, companies need to take an in-depth look at how they collect and process customer data and understand where changes need to be made in order to future-proof their data privacy practices when facing waves of new regulations.
At the heart of this endeavor is the need to give customers complete insight not only into how companies are using their data but also empowering customers with the ability to change those permissions whenever they wish. What’s required is a self-service preference center where a customer can view the full data set a company has regarding that individual and where that customer can modify those permissions.
Create a Centralized Universal Data Layer
In order to provide customers with visibility into how companies are using their data, companies need to first be able to identify individual customers and then gain their consent to use their data. Then, companies need to unify all the customer data they have within a centralized data layer that spans their entire organization. Being responsible about customer data should be positioned as everyone’s issue within an organization, not simply a matter for IT or risk professionals.
Within that universal data layer, companies can create a distinct, up-to-date profile for each individual customer, which is continually refreshed with the latest information gathered relating to that customer’s engagement with any of the company’s digital touchpoints.
Create Value and Long-Term Relationships
We live in a highly customer-centric world where potential buyers take the time to conduct their own online research and poll their peers before embarking on any purchase. So, by the time the customer is directly engaging with a company, they’re already a substantial way into their customer journey. Their expectations for customer experience are high and they expect fast and frictionless interactions. Personalization can help speed these interactions, but customers must be able to set their preferences for how much or how little of their personal data companies can use to power these engagements.
Companies need to be able to demonstrate that they are trusted guardians of their customers’ data, that they are using that information only to benefit the individual customer, and to provide more value in customer experiences.
Once customers are convinced of a company’s trustworthiness, they will be more willing to share their personal data, laying the foundation for a long-term relationship or partnership with that company.
This article is part of a 5 part sponsored article series by SAP