Have You Considered Customer Privacy in the Changing Data Landscape?

Digital advances such as The Internet of Things and wearables allow for greater data capture and insights, but what about customer privacy?

At a recent Rakuten Marketing event, its Vice President, Archie O'Connor, said that data is a "massive" competitive differentiator for the company because it makes their inventory more valuable. After all, advertisers get a greater transparency which leads to a better quality of leads.

One of the things they've discovered is that in the cross-channel, cross-screen customer journey, the last click - traditionally the one focused on within marketing and advertising spend - is not necessarily the most important one.

Having a better insight into this data will not only make advertising of greater value to the marketer but also to the end user. O'Connor highlighted the example of Amazon recommendations, which are genuinely helpful to customers who don't even tend to know that the recommendations they're browsing are ads.

And with the increasing use of the Internet of Things - more screens means more engagement, O'Connor said - and wearable devices, which open up a whole new field of easily accessible customer data, insights are only becoming more sophisticated.

See also: Microsoft's Data Culture and the Future of Analytics 

However, one consistent message that came across from the panel of experts at the event, is that the greater use of data insights that these mobile developments allow could be interpreted by the customer as "creepy". And rather than the data leading to a closer and more advanced customer journey and lifelong relationship it can scare them away - for good.

A great example of data insights gone wrong was given by Alastair Bulger, Director Solutions Architecture at Krux Digital, who mentioned that American retailer Target gained headlines a few years ago when it started sending vouchers for pregnancy related products to customers before those targeted even realised they were pregnant.

When the case of a teenager who was on the receiving end of the mailings made the news, customers were understandably freaked out by the fact that the company's data algorithms were able to predict pregnancies based on changing spending patterns of customers.

So while for marketing and advertising purposes greater data insights can be hugely beneficial, you have to ensure that as a company you don't cross that crucial privacy boundary and be viewed by your customers as "creepy".

James Maley, Senior International Marketing Manager at Hilton Worldwide, said that as targeting gets more specific you can talk to customers in a better way and impressions become more intelligent.

However, he also added that for those privacy concerns it's important to be completely transparent with the user. You need to tell your customers why you're targeting them, which is where you can highlight the benefits are not just for the company but for the end user as well, and also provide them with the opportunity to opt out.

He also added that privacy issues are international and EU laws are understandably changing the landscape, so as an international company it's important to ensure that you keep up with the changing regulations in this field.

It's a fine line between utilising big data insights gained from the ever-evolving digital landscape to provide a more targeted marketing campaign and customer experience, and breaking the privacy boundaries which can results in the alienation of customers and a hit to the brand reputation. And it's definitely one worth considering when implementing new developments such as the Internet of Things and wearable devices to gain a better understanding of your customers.