How can marketers get customers to allow use of their personal data?

CUSTOMERS are concerned about how their personal data is used — which is why they’re lobbying regulators across the world to create laws penalizing its unauthorized collection, storage, and use.

Laws such as the General Data Protection Regulation (GDPR), the California Consumer Privacy Act (CCPA), and Singapore’s Personal Data Protection Act (PDPA) show that lawmakers understand and agree with the concerns raised by citizens.

In such a world, marketers have been struggling to get customers to consent to use of personal data — no matter how inconsequential — for personalization of messaging.

The impression that customers often have when it comes to personalization, given the projects undertaken by excited marketing professionals in the past, is that the overall effort is heavy-handed, unnecessary, and border-line “creepy”.

Personal data cannot just be collected, with or without regulations in place. Marketers need to earn the trust of customers and get their consent to use their data for personalization projects.

According to Gartner, 80 percent of marketers are likely to abandon personalization efforts by 2025 due to the lack of returns on such projects.

“Personal data has long been the fuel that fires marketing at every stage of the customer journey, and the drive to find new forms of fuel and devise new ways to leverage them seems to be boundless,” said Gartner for Marketers Senior Director Analyst Charles Golvin.

“However, this quest has failed to meet marketers’ ambitions and, in some cases, has backfired, as consumers both directly and indirectly reject brands’ overtures.”

Golvin believes that consumers have developed an increasingly jaundiced eye toward marketers’ efforts to embrace personalization solutions.

Increasingly cluttered email inboxes and mobile phone notification centers today lead customers to ignore even the most carefully personalized and contextualized message.

In addition to the negative reaction from customers, other barriers to personalization that Gartner cited include the continuing decline in consumer trust, increased scrutiny by regulators, and tracking barriers erected by tech companies.

Want personal data? Make a really good offer

Numerous studies have shown that although customers are concerned about personal data and data privacy in general, most are willing to share a part of that data in exchange for something of significant value.

Take the financial services space, for example. Customers don’t hesitate when providing traditional banking institutions with personal data — but fintech companies such as platforms that help compare credit cards or find the best loans given an individual’s specific circumstances also get a similar level of access given the value they provide.

Skincare and cosmetics companies and some retail companies tend to get customers to volunteer personal data and gladly consent to its use because they not only get better deals in exchange but also personalized recommendations that are powered by artificial intelligence (AI) and AI-derivative technologies.

If marketers want to get access to customer’s personal data and use it to personalize messaging or offerings, they need to provide significant value.

Gartner’s forecast found that 27 percent of marketers believe data is the key obstacle to personalization — revealing their weaknesses in data collection, integration and protection.

In order to provide value, marketers need to drive businesses to fix their ecosystem and use data effectively, providing value in new and interesting ways to customers.

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