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Striking the Personalization-Privacy Balance

4 minute read
Mark Floisand avatar

Consumer privacy is under assault, as reflected in multiple national headlines: NSA collects personal data, Facebook launches facial recognition software, Uber can now track customers even if the app isn’t open… According to a recent survey by SAS, more than three quarters of U.S. consumers say recent events in the news have boosted their concerns about their data in the hands of businesses.

This creates a conundrum for marketers: how to create the personalized experiences that customers expect without compromising their personal information.

As consumers, we want personalization. Whether it’s an online electronics retailer that recommends routers for my recently purchased modem or a ride-sharing service that sends me a promotion for an upcoming event in my city, personalization done right is really useful. It makes for happier and more loyal consumers.

But done poorly, personalization risks alienating customers and damaging the company’s reputation. Last year when one of Uber’s executives was caught spying on a reporter without her permission, hundreds of Uber customers asked, “What if they’re spying on me, too?” Such incidents aren’t helping make consumers feel comfortable about who has access to their personal data.

Marketers must strike a balance between privacy and personalization. To avoid learning the hard way, here are my five top suggestions:

Think Like a Consumer

Instead of wearing the marketing hat all the time, consider how it would feel to be the consumer before creating your new email campaign. Imagine: “If I were a consumer, how would I react to this?” Would the personalized messages feel relevant and personal, or would they feel sneaky and intrusive?

Nearly three quarters of consumers believe that using personal information without their permission violates their privacy. Balancing privacy and personalization taps into the business ethics of marketers. What marketers can do with the data at their fingertips is very different from what they should do.

Communicate Your Policies

First and foremost, be transparent about your policies. Only 32 percent of consumers say companies are open about their policies on using personal data. That transparency impacts how much information consumers are willing to share. When consumers feel a company isn’t being open about data use, they won’t share as much information.

Second, keep the policy simple. Avoid the legalese, and summarize key points in an easy-to-read bulleted format that won’t make customers’ eyes glaze over. Uber may not be the poster child for a perfect approach to privacy, but one thing the ridesharing company has gotten right is its privacy policy language: It’s short, easy to read and available in 23 languages.

Learning Opportunities

Work With the Product Team on Controls and Settings

Ninety-three percent of adults say being in control of who can access information about them is important, and 90 percent say controlling what information is collected is important. Marketers must work with the product team to make sure consumers have the option to control their data sharing settings.

Some may think that the majority of consumers don’t bother to change their privacy settings, but in 2012 only 7.7 percent of U.S. Facebook users chose not to change their privacy settings or didn’t know they could change them. In practice, if you have 100 million customers, you aren’t going to look at data on an individual level, but consumers certainly care about being able to control their own data.

Localize Your Privacy Approach

In working across the globe, I’ve found that countries have various relationships with privacy. European countries have stricter regulations around privacy and data protection compared to the US and Brazil, for instance. If you serve global markets, make sure your privacy policy is adapted to each country’s perspective and regulations around privacy.

Keep your finger on the pulse of new local privacy rules, because they’re constantly changing. The pending privacy regulations in Europe would allow consumers to sue companies that aggregate data — i.e., the majority of tech companies out there. In today’s world, nearly all companies operate on a global scale. Local regulations will likely apply to you in some situation or another.

Remember Your Goal of Delivering Great Experiences

Use personalization to deliver value, not just because it’s the shiny new thing to do. If customers get spooked by their calendar pre-populating events from an email, or if ads are tracking users in public with facial recognition software, maybe you’ve lost sight of the goal of delivering great experiences. Tread the line of privacy and personalization carefully.

Some consumers may be willing to trade privacy for a better user experience, but the reality is that most people care about having control of their personal information. While this poses a challenge for marketers, it also gives them an opportunity to show just how much they care about their relationship with the customer.

Creative Commons Creative Commons Attribution 2.0 Generic License Title image by  Steve Snodgrass 

About the author

Mark Floisand

Mark Floisand is vice-president of Product Marketing for Sitecore. He has over 20 years' marketing, sales and general management experience in the technology industry, spanning blue chip and start-up companies across three continents.