I was buying a jacket in a well-known clothing chain when the young salesperson urged me to sign up to their newsletter so I could be kept informed of sales and customer VIP nights. I really like the store and I want this information – I want to be the first person in the store on sale night. So I enthusiastically agreed, only to be presented with a page-long form asking for everything from my age to my mobile number, address and dress size.
I don’t mind providing my information – I’m sure it will lead to a more personalised service in the future, which ultimately is to my benefit. But is it really necessary to collect all that information at that precise time? Like most consumers, I’m busy. All I’m trying to do is buy a jacket (and get invited to the presale) and all they really need to start the relationship is my name and email address.
ADMA’s recent study with 1600 Australians, Attitudes to Information Sharing, Privacy and Trust, revealed that while consumers are willing to share personal information with companies that demonstrate good conduct around information collection, 77 per cent don’t like it when companies are greedy and ask for too many personal details upfront.
The lesson is this: Start simple. As marketers, we have been conditioned to see the first interaction with a customer as the most opportune moment to gather as much information as possible, thereby providing data depth that will assist us in having an ongoing relationship. However, times have changed, and we are now in the world of engagement. The reality is relationships build over time. We don’t need all the customer’s information immediately. Instead, we should have an effective customer engagement strategy in place to allow the depth of data to build with the relationship. This makes it more convenient for the customer and certainly a better experience.
Behaviour matters
The importance of how we behave as brands in relation to customer data will be a key brand differentiator in future. ADMA’s research shows that although we have new privacy legislation in Australia that keeps businesses in check, consumers aren’t focused on the laws. Instead, they are interested in behaviour around personal information and whether that behaviour leads to trust.
You can be a great brand, but the research shows that is not the most important factor for consumers when deciding whether or not to provide their personal information. It’s about how the brand behaves in relation to that data, and the degree to which the brand is transparent about what it does with information – how it’s collected, how often it’s used, whether it will be disclosed to a third party, and whether it will be stored securely.
It’s also important to be aware that what concerns consumers most is their personal information will be shared without their knowledge. Our study found where there is lack of clarity around whether data will be shared, consumers are less likely to provide their information. That’s not to say consumers don’t want information shared, but they would like to know if it’s going to be shared, with whom and, where appropriate, and be provided with a choice about this.
Transparency is key
The answer to demonstrating good brand behaviour is greater transparency. In our study, 88 per cent of consumers said it’s very or extremely important companies clearly tell them how their personal information is used. In addition, 81 per cent said they’d like to have a better understanding of what personal information companies are collecting and how they’re using it. This shows we still have a lot to do in getting the messaging right.
We must rethink how we approach the challenge of informing consumers about our data practices. Trust me, the days of long-winded privacy policies, lengthy terms and conditions, and small print are gone.
Companies that find simple and engaging ways to convey this information will be the ones that ultimately gain consumer trust, and that’s essential for an ongoing relationship. A great example of this is the recent video produced by Woolworths, which delivers a clear, concise and cute two-minute animation showing what the company does with customers’ personal information and how to change preferences. The colourful cartoon is engaging and easy to understand (see: http://idg.to/bDo).
The results of our research are clear: The requirement to build trust and consumer confidence is, and will continue to be, a business essential. Lack of clarity makes customers feel uncomfortable in providing information and leads to consumers putting their own controls in place to overcome discomfort levels. The research shows two in three consumers (66 per cent) are deleting cookies as a means of protecting privacy and a greater proportion have multiple email addresses.
Give choices
As a final point, it’s important the choices we provide to our customers are real choices. As a customer, I don’t want a blunt ‘in’ or ‘out’. Yes, I want to receive marketing, but perhaps not everything. Instead, I would like a choice as to the type of information I receive and how I receive it. Give me an option to hear about specific products or subject matters, and allow me to indicate my best form of communication. A well-structured, easy-to-access preference centre will go a long way towards creating a better customer experience with consumers feeling in control and businesses being able to deliver to customer expectations. It’s a win-win.
The Attitudes to Information Sharing, Privacy and Trust report provides great insights into how to build trust, transparency in your communications and how to ensure your customers feel informed and is free to download.
This article originally appeared in CMO's June 2014 magazine edition. To subscribe to your complimentary copy of our print title or our weekly newsletter, subscribe here .
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