Customer satisfaction: Personalisation vs privacy

By Anders Björklund

Customer satisfaction: Personalisation vs privacy

Customers want companies to provide relevant solutions and products in combination with personalised services. At the same time, people are concerned about how companies use their data. Consequently, to maintain data privacy is of paramount importance. How could you and your company achieve the wanted balance between data privacy and personalisation?

Your company shares a complicated relationship with your potential and existing customers. On the one hand, your customers want you to understand their needs based on their buying behaviour. On the other hand, they are also worried about data privacy. Now and then, data leaks have led to a growing distrust in companies. Most customers are concerned about companies collecting and selling their personal information without them being aware. Some of these scandals created the need to develop and implement GDPR to protect personal data. In such a scenario, how can you and your company offer personalisation while protecting customer data?

I have listed some practices that you could implement.

Concerns over data privacy

Make it simple and transparent for customers to share their data. A recommended way to build trust with your customers is to be transparent with them, explaining why, how, and for what period your company collects their data. Most companies communicate and follow these principles in their privacy policies, while some companies still leave customers in the dark, especially when implementing artificial intelligence (AI) solutions. It would be best to assume that most of your potential and existing customers do not feel comfortable when you utilise AI to capture and manage their data.

You need to mention it in your privacy policy and ensure that you communicate your policies to the customer in an understandable language accessible for most readers. Customers often face an extensive privacy policy where you need to read a vast amount of pages before you can click 'I agree', handing over your data. Documents like these are not user friendly and helpful.

Companies can use data privacy to gain trust from their potential and existing customers by communicating how they are taking care of their data and remain compliant. To be transparent is more than giving customers the options to manage their data; it is also about how this is done, for example, by using an understandable language and keeping the users informed on policy changes with easy-to-access summarised versions in various touchpoints. To reposition data privacy to be used from a customer-centric perspective is an elevating exercise for companies, and the brand, which set them apart from the competition.

You and your company should provide more information on how and why customers are being targeted. Companies that educate on the technology behind could reduce the amount of uncertainty-induced fear that audiences experience. Transparency leads to trust.

Only collect the data required to provide real value for customers. In addition to being transparent, companies should build trust with their potential and existing customers by only collecting the essential data.

Companies try to personalise to prove that they know customers and believe that they are helpful. But I can not think of any company that fully succeeds in personalisation based on customer expectations, habits, and needs.

Your potential customers see more value in relevant personalisation efforts than ever before; they want supportive and knowledgeable help during their purchase and decision process. Most customers are open to sharing data if they find real value in exchange for their data. And many customers are willing to give away their data in return for lower prices on products or services.

Amazon's offers and recommendations to its customers when they log into the portal is an example of providing such customer value. Hence, when companies collect customer data, they should use it wisely to offer them the right value.

Become more relevant

An important aspect of personalisation is relevance. Personalisation usually looks something like this today; a customer gives his/her data to a company when they purchase at some point. The company then starts sending them messages related to various offers, whether it is relevant or not. Companies may also send messages on products, solutions, and services that are not relevant to them. These messages can potentially overload their customers, causing many of them to unsubscribe.

When customers receive personalised but irrelevant suggestions and alerts, they unsubscribe from subscriptions and alerts, or even ads the company to Junk-mail. Furthermore, some existing customers completely stop doing business with these companies.

Companies should only use data to send customers and prospects messages that are relevant to them. Another essential part of being relevant is to use the preferred touchpoint or channel to send a suggestion, information or alerts to customers. Many find it creepy when they search, and that ads start following them on all online platforms. Retargeted ads evoke two primary responses, annoyance and frustration. Preferably, companies should give customers the option of where, how, and what communication they want to receive.

Practice personalisation

Advancement in digital technologies brings rapid changes in customer behaviour. And COVID-19 has brought even more drastic changes in customer priorities and buying patterns. Earlier personalisation strategies that rely on historical data will not be as useful in these rapidly changing times.

These extraordinary times have brought some specific challenges around personalisation strategies that you and your company need to consider.

Much of the analytics that has driven personalisation efforts to date have relied on historical data. Most of this data is now useless, given the scale of change we are witnessing now. If your company wants to deliver services, meeting today's digital customers' needs, you need to embrace much more rapid engagement strategies.

Companies need to review and re-learn their potential and existing customers' wants and needs and start all over again to be successful. The best way to do this is to turn to the customers themselves. Companies can naturally learn about what matters most to them when giving customers control and influence over the services they use.

Enhance data governance

Also, to be careful about how you and your company fetch and use your potential and existing customer's data, you should be cautious about protecting their data. Your company must enhance data governance as well as how you store and protect data. The world is seeing an increase in malicious activity. Hence, there is an increasing need for protecting sensitive data. Your company's data protection must spread across your IT environment. Additionally, your company should empower your employees to address data privacy during their communications with your potential and existing customers.

For you and your company to gain trust from customers, data privacy and security are critical aspects. To preserve this trust, you must build standards, policies, and procedures to ensure security and privacy are addressed in your full offering. It means you should empower your colleagues to take active roles to help keep operations, people and assets secure for your customers and ourselves.

As you identify threats, you should place transparency as the utmost importance in your customer communications, interactions, and plans. Furthermore, you should proactively engage them to take specific actions to improve their security.

Conclusion

Offering personalisation while maintaining data privacy can seem like a difficult road to follow. You and your company can achieve this balance by focusing on three key aspects: 

  • Transparency
  • Relevance, and 
  • Effective data governance. 

Getting these three pillars right will help you and your company to comply with data privacy, gain customer trust, and provide real value to your potential and existing customers.

Download the ebook to learn about the key reasons you should prioritise customer satisfaction today!

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Anders Björklund
Founder, CEO & Strategist since 2001. Anders provides thoughts and reflections about what and how to think about onlinification and digitalisation in B2B. Asks a lot of questions, and knows what to do with the answers.
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