Balance data privacy and personalization for a better customer experience

by Wilson Raj, Global Director for Customer Intelligence, SAS

Recent data breaches and potential changes in data-privacy legislation and regulations loom large as customer expectations concerning marketing data continue to rise.

The number of US data breach incidents tracked since 2005 reached 5,029 reported data breach incidents, involving more than 675 million estimated records according to the Identity Theft Resource Center (ITRC).

As a result, today’s complex data privacy issues – including customer expectations, data-security lapses and legislative efforts – are alarming for marketers and customers. To gain some clarity around this important topic, SAS recently conducted a global study on how consumers balance their need for privacy and with their wish for personalization.

The results of our study are found in the white paper: Finding the Right Balance Between Personalization and Privacy.

We found that 69 percent of those surveyed said recent news – NSA leaks, social media privacy changes, data breaches, etc. – increased their privacy concerns.

Yet, consumers are still willing to trade privacy for personalization. Our study showed that 59 percent still expect businesses to know their preferences and understand their needs.

It seems there is a fine balance to strike between the desire for privacy and the desire for personalization. How do we make customers feel “known” and welcomed while also preserving their privacy?

Ways to ensure and strengthen data privacy

In exchange for consumers' trust, you must offer relevance, value and control. In exchange, consumers will show trust by providing their information.

If you can assure customers that their data is well managed, consumers will provide some personal information for more individualized experiences – as long as they get to make that choice themselves.

Organizations that use and manage data in ways that customers understand and trust will gain significant advantage. The up-front work that organizations must do is set clear expectations with the customer and then building trust through consistent internal and external activities.

Internally, companies must master data stewardship by:

  • Making data policies transparent. For all data collected there should be a stated purpose.
  • Ensuring and regularly verifying data quality. Customer records should be accurate and up to date and deleted when it is no longer needed.
  • Ensuring data security and protection by using the appropriate tools, including authentication, backup, replication, training, policies and procedures.
  • Defining a reasonable data retention period.

Externally, companies must engage customers by:

  • Issuing clear communications on how customer data is going to be used and what types of data are being collected.
  • Providing mechanisms for individuals to review their personal¬ data, to ensure accuracy. This may include periodic reporting.
  • Refraining from asking consumers for too much data up front. Focus on building the customer experience by collecting data incrementally and using analytics to enhance their experience.

As consumers continue to use technology that opens their lives to others, they have dual expectations of businesses: understand me as an individual and protect my privacy. Therein lies the opportunity to achieve balance when crafting customer experiences.

    Wilson Raj

    Wilson Raj is global customer intelligence director at SAS. He is responsible for collaborating with industry leaders, customers, and alliances, and sales, marketing, and product teams, to establish and evangelize SAS' customer intelligence solutions.

    Balance privacy and personalization

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