More data, less customers? Gain both and a competitive edge in 4 steps.
We get it. Data is gold. But brands have gotten so desperate for it, they’ve sold their souls to obtain it. That means they’ve stopped treating the very lifeblood of their business–their customers–with the respect that they deserve (and who they need to stay loyal!). Not only is this unethical, it’s bad for business. A McKinsey report found that 75% of Americans are concerned about their online privacy, and a Tableau study found that 63% of Internet users think most companies aren't honest about how their data is being used. So it comes as no surprise that nearly half of these respondents stopped shopping with these companies. That means that brands are losing the trust of the people they’re trying to retain. Why? Because people don’t like to be tricked into exposing themselves. People care about their privacy so much that a study by Cisco found that 37% are dropping brands that don’t and switching to those that do. 76% of consumers say they wouldn’t even buy from a company they don’t trust with their data. That’s why privacy-centric marketing is more important than ever–not just for customers but also brands. Finally, good values can pay off in more ways than one.
4 ways to earn customers’ data and trust.
- Explicit Consent and Transparency: Gaining explicit consent from customers before collecting and using their data helps establish trust and lets them know you’re being transparent about the ways you will be collecting, storing, and using their data.
- Consumer Data Protection: By taking proactive measures to protect consumer data, you can ensure appropriate security measures are in place to protect their data and that you are compliant with privacy rules and regulations. And since they’re tightening worldwide, brands need to make sure that they’re up-to-date.
- Opt-In Personalization: Recently, there has been a trend towards opt-in personalization, a concept that allows customers to actively participate in the level of personalization they want when they interact with a brand. This empowers the consumers to be a part of the decision-making process, fostering trust and credibility.
- Privacy as a Competitive Differentiator: Forward thinking companies are starting to look at privacy as more than just a way to build trust. They’re seeing it as a customer experience differentiator and a foundational element for building sustainable revenue streams. In fact, Gartner predicts that by 2024, an average large organization’s annual privacy budget will exceed $2.5 million, and there will be a shift from compliance ethics to competitive differentiation.
Brands that have set a great example.
- Apple: Privacy is more than just a marketing slogan at Apple. The company has proven that it can turn it into a competitive differentiator. For example, new iPhone features restrict app access to personal data, and the company has heavily advertised its commitment to privacy. This approach gives Apple products a competitive edge, making them more attractive to consumers.
- Unilever: At Unilever, compliance with privacy regulations is the baseline, and like Apple, they’re viewing the new Age of Privacy as an opportunity to set themselves apart from the competition and build more trust with their customers.
- Mastercard: Similar to Unilever, Mastercard sees compliance as the bare minimum, and strives to go beyond that to earn the trust of consumers and employees alike. Their approach has helped them navigate the new rules of privacy and maintain their reputation as a brand you can trust.
So what’s the catch? There isn’t one. By embracing privacy-conscious practices–prioritizing trust and transparency as well as empowering consumers–your brand will not only have a chance to build better customer loyalty but also create stronger, more meaningful consumer connections. Not only that, these practices make your brand look good, meaning you could appeal to people who aren’t even in your target audience but share the same values. How’s that for a win win?
If you want to nerd out on customer experience and data we’re here to help.
