Dig deeper into the consumer and business responses
The New Data Deal
People have a complicated relationship with their data. They believe there is value in sharing data with companies, but they are increasingly uneasy about security, privacy and the value they are actually receiving.
But as companies strive to adapt and innovate in response to the uncertainty brought on by the COVID-19 pandemic, they are increasingly turning to digital technology as the foundation of business resilience. And digital technology needs customer data. It is the fuel that drives personal, relevant engagement. Now more than ever, brands need to understand their customers, which means they need to be intentional and thoughtful about their own relationship with data.
In January, we conducted a survey of over 5,000 consumers and 2,000 businesses globally on their attitudes and concerns around consumer data practices. While the surveys were conducted before COVID-19 began to seriously effect the economy, the responses are as important and telling today. For example, 67 per cent of consumers stated they were worried about identity theft, with 57 per cent of consumers saying they had experienced some type of data breach. Even more telling, almost half (48 per cent) see a lapse in data security as inevitable — agreeing that their personal data will be breached or stolen eventually.
67% are worried about identity theft.
57% experienced some type of data breach.
48% see a lapse in data security as inevitable.
Source: Adobe and Advanis
Despite having a lack of confidence in the security or privacy of their data, 76 per cent of consumers said they are comfortable sharing personal information. But they do so in expectation of a better customer experience.
Unfortunately, companies are underdelivering on this expectation. A significant majority (78 per cent) of companies believe that their organisation has the right tools and systems in place to use data to improve customer experience effectively. Yet only 48 per cent offer personalised content and only 40 percent provide the benefit of discount offers.
In an era where consumers hold much more power, trust has become the new currency — and brands should be doing more to build that trust. For consumers to trust companies more, they expect more transparency and more control. They expect a much better experience than what they’re currently getting in exchange for their data. And that means companies today may need to change their approach to data — sometimes drastically.
81% of companies believe they will have to demonstrate that consumers will receive a tangible benefit in order to justify collecting and using personal information.
Source: Adobe and Advanis
The opportunity for brands
To understand the scope of these changes, consider this. In 1932, when Franklin D. Roosevelt pledged “a New Deal for the American people,” the three core tenets of the New Deal were to provide relief, recovery and reform. To achieve these goals, the New Deal included banking reforms, emergency relief programmes, work relief programmes and agricultural programmes.
Now, consumers are looking for an another “New Deal,” but this time, they want reforms around data collection practices.
Governments are also increasingly aware of this need to help protect the public’s data. In 2016, the European Union (EU) passed the General Data Protection Regulation (GDPR), which went into effect in 2018 and set strong data protection rules for EU citizens and companies that do business in the EU. The State of California has followed Europe’s lead with their own legislation — the California Consumer Privacy Act (CCPA). Brazil and Thailand also have both recently passed data protection laws and India has a new data protection bill under consideration. We can expect even more countries to follow suit.
Governments are starting to step in to offer consumers more protection around the use of their personal data. But except for Australia and Asia Pacific/Asia Central (AU/APAC) consumers surveyed, very few consumers — only 28 per cent — believe governments are doing an adequate job protecting their personal information. Even in the AU/APAC, only 44 per cent say governments are effective at regulating the protection of personal information.
For forward-thinking, customer-centric businesses, the current state of affairs around data security and privacy practices offers a unique opportunity to set a new standard by crafting a “New Data Deal” with consumers. A deal that builds greater trust and loyalty by being transparent, empathetic and upholding the promise to deliver more value through customised and relevant customer experiences.
3/4 of consumers don’t think governments are doing an effective job of protecting their personal information.
1/4 of consumers believe there is nothing they can do to protect their personal information.
Source: Adobe and Advanis
The core tenets of a New Data Deal
When President Roosevelt took office in 1933, he acted swiftly to stabilise the economy and deliver progress and hope to citizens. Companies should do the same today when it comes to their data marketing practices.
This New Data Deal should be built around these core tenets:
Transparency
Empathy
Value
These are essential to build consumer trust and loyalty. And they’re vital to help consumers take more control and ownership over what data they give and what experiences they want to receive in return.
Here’s a look at how you can bring these core tenets into your own organisation to offer your customers a new and much better deal.
TENET 1
Thrive with transparency
President Roosevelt did something many politicians avoid — he was transparent. By talking directly to Americans in his fireside chats, he explained his policies, subdued rumours and gained people’s trust. He understood then what many brands still struggle to understand today — that transparency and trust go hand in hand.
Research from SAP shows that 79 per cent of consumers will leave a brand if companies use their data without their knowledge. But companies that go the opposite route — and choose transparency — can thrive.
By being open and transparent in their data security and privacy practices and only using data they have earned through explicit customer consent, companies have an opportunity to build greater customer trust and strengthen brand loyalty.
“Privacy is all about transparency to the data subjects around what’s being collected about them and giving them greater control over that data and what data resides in the systems of a given enterprise,” notes John Bates, director of product management at Adobe. But he also notes that privacy must go hand-in-hand with security. “Security is also the responsibility of the organisation and the employees within. They need to help safeguard that data so that it’s only available to individuals that need it to accomplish their jobs and to better ensure that any data transferred across the Internet is safeguarded and not available to any third parties.”
To help ensure greater transparency when it comes to data security and privacy practices here are the best practices we recommend and follow ourselves.
Obtain the appropriate consent from consumers
The technologies used to collect, store and action data should provide tools that allow consumers to opt in or opt out of data collection. The gold standard is a consent process that is simple and easy for consumers to understand and allows them to provide consent based upon the different use cases for their data.
It’s also important to make sure that once data is collected, what happens next with it mirrors a consumer’s consent preferences. For instance, if someone has explicitly requested that they not be contacted via email, they shouldn’t be included in an outbound email retargeting campaign. You will need robust technology to help ensure that the genealogy of the data that flows from one system to the next is following the consent given by the consumer.
Audit and evaluate internal workflows and processes
This means businesses need to be confident that they have the right workflows and internal processes in place to help ensure robust data security and privacy practices. Plus, all marketing and data technology should have strong security controls built into the products, like data encryption, appropriate compliance certificates for the industry and the ability to set levels of permissions based on roles.
It’s also important that you have visibility — from data ingestion to data activation. The best data platforms make it easy to audit to ensure that you have the appropriate security in place. “Your first-party audience data is incredibly valuable and you’ll want to help protect against data leakage,” says Adobe’s CIO Cynthia Stoddard. She recommends that undergoing a security audit that addresses how you share data — for example between your DMP, DSP and advertisers.
Provide a consolidated and clear experience for consumers
Consider a consolidated privacy portal. This portal provides a one-stop-shop where consumers can submit their data access or data deletion requests as well as gain a clear understanding of what data is being collected about them and provide consent around that data.
At Adobe, our privacy portal clearly explains the types of data we collect and allows consumers to set preferences around desktop applications, identifiable data collection, mobile applications and Adobe interest-based ads. We also let consumers set preferences around the use of machine learning analysis.
Develop a data transparency strategy with an eye toward the customer experience
At the end of the day, like everything in your business, being transparent about your data collection practices should revolve around providing a better customer experience. “Brands need to view privacy and data collection as an opportunity to build a relationship with customers versus a restriction or hurdle,” notes Nate Smith, group manager of product marketing at Adobe. “That means enabling customers to have transparency into how data is being used, as well as control over how it’s used. If consumers don’t see any value being offered by a brand in exchange for their data, they won’t be giving that brand their data and likely won’t be an advocate for the brand either.”
To this end, there is also an opportunity to reduce fragmented customer experiences by implementing systems that speak the same language and seamlessly share data in real time. As these new technologies are implemented, IT departments need to continue to invest in ensuring that data usage constraints are respected and that data is kept safe through privacy capabilities.
TENET 2
Exercise empathy
Through his fireside chats, President Roosevelt spoke to people in a way that conveyed that he understood their challenges. In other words, he showed empathy and companies today need to do the same. And the value of that empathy speaks volumes, as Harvard Business Review has found that these companies “retain the best people, create environments where diverse teams thrive and ultimately reap the greatest financial rewards.”
In our survey, 85 per cent of consumers globally believed that they had a right not to be tracked online. Not only do companies need to respect this desire, but they also need to engage in their entire data practice with empathy and respect to the consumer as the foremost concern.
While most consumers (59 per cent) feel comfortable sharing their email address to personalise their online experience, they do not feel the same way about all types of personal information — and preferences can vary based on geographic location. France (61 per cent) and the UK (58 per cent) are most comfortable sharing their full names in order to receive a personalised experience. But overall, only half (50 per cent) of consumers are comfortable sharing their full names. And most consumers are not willing to share their phone number to personalise their online experience. Germans had the lowest willingness at 13 per cent, while those in APAC had the highest at 31 per cent.
The data sharing divide.
Yet despite resistance by all consumers to sharing their phone numbers, 75 per cent of companies said they collected phone numbers. Eighty-two per cent of companies also said they collected full names, while 84 per cent said they collected email addresses.
Taking an empathetic approach to your data marketing practices — and to your customers’ preferences — means that when you do ask for that data, you have a good reason for doing so and it needs to be focused primarily on enhancing the customer experience. For example, when phone numbers tie together digital channels with your call centre, allowing your agents to provide a better experience, having the customer’s phone number improves the overall experience and may, as a result, be warranted.
“I think the key here is that the consumer is making the explicit choice on which channels they want to communicate with the brand. And then given those channels of communication, they’re providing permission for companies to tie their information together with the channel,” says Bates.
Empathy and company culture go hand-in-hand
Developing empathy for your customers doesn’t just happen. It comes from a broader company culture — one that puts the customer first and applies this customer-centric focus to their data practices as well as the experiences they deliver. It means asking “what does the customer want” and using the answers to define your strategy, instead of simply maintaining the status quo or doing what’s easiest.
Because technology is so fundamentally critical for success, CIOs will play an essential role in leading digital transformation that is empathetic and customer centric. As Stoddard notes, this culture must span across the organisation — including IT.
“Make it a priority to continuously meet with customers to discuss their digital transformation journeys, challenges and best practices and bring those insights back to the team…If employees understand the customer journey and the customer’s pain points, they can come up with powerful, innovative solutions to craft better experiences.”
Cynthia Stoddard
Senior VP and CIO, Adobe
For companies like Lenovo, who have worked to change their internal culture to be more customer-centric, the payoff has been well worth it. In an effort to double their digital sales in three years, the company first focused on putting the customer at the centre of their journey.
“Four years ago, we invited gamers to come and give input into building a commercially developed game. That told us a lot of things that we did not know. A big part of it was that gamers really, really want to be involved in the process. It’s not sufficient for them to buy technology. They want to have a say. And the more they engage, the more loyal they are to the brand. We have changed the business model to be much, much more inclusive, immersive and collaborative,” said Ajit Sivadasan, leader of e-commerce and digital strategy at Lenovo.
By being empathetic to the customer and truly trying to understand what they value combined with data-driven insights, Lenovo was able to develop a video game for highly specific audiences and enjoyed a 300 per cent growth rate as a result.
TENET 3
Deliver value
The New Deal offered real, tangible value — it was successful in creating new programmes that gave work and hope to millions of people, it put safeguards on the banking industry and it created a safety net for workers. Similarly, the third tenet of the New Data Deal requires companies that collect consumer data to deliver value in return.
Yet when it comes to companies’ data collection practices, one of the biggest reasons for consumer backlash is the belief that there isn’t enough in it for the customer. Our survey showed that almost half (46 per cent) of all consumers like getting news or articles suggested that are geared toward their interest and (48 per cent) like when a company recognised them when they call or log in. However, less than half (41 per cent) of all consumers believe that companies do a good job of targeting offers to their needs.
46% of all consumers like getting news or articles suggested that are geared toward their interest.
48% like when a company recognised them when they call or log in.
41% of all consumers believe that companies do a good job of targeting offers to their needs.
Source: Adobe and Advanis
Companies often have a different perspective, believing overall that they are providing value through better customer experiences. In our survey, half of all companies said they felt their organisation’s personalisation of digital content is extensive.
Clearly, there’s a disconnect. In order to deliver value to their customers through more personalised experiences, brands need to put their data to work.
Improve data integration and unify the customer experience across channels
To create a better customer experience, being able to integrate and normalise data across disparate systems to create a comprehensive view of each customer is essential. The Home Depot, owner of the sixth largest e-commerce site in the world, is a good example of how better data integration has allowed them to unify all their customer data across all channels into a single customer profile.
“Instead of separating metrics from online and off-line channels, we focus our attention on capturing data, including website activity, in-store sales, call centre volume, return volume, order cancellations and much more, thus enabling us to make the best decisions to improve the shopper experience across all touchpoints.”
Ranjeet Bhosale
Director, Online Analytics and Business Intelligence, Home Depot
Now, customers can input their lists into the Home Depot app and once they reach the shop, the app directs them to the right aisle and bin number to find the right kitchen tap, sledgehammer or a tube of liquid nails. From the same screen, customers can read reviews, follow how-to videos and get product details.
This interconnected, online and off-line experience has allowed Home Depot to get information to customers faster, which means they’re finding stuff quicker and not getting lost during the journey. And it’s working. Today, $8.6 billion in sales are attributed to online orders. And about half of those orders are being fulfill in-store.
Present content in an optimal manner
Content presentation affects the customer experience as well — and data can be helpful in enlightening companies as to what is the best experience for their customers. The National Centre for Missing and Exploited Children (NCMEC) began using a new platform that gave them greater visibility into website traffic, navigation, donations and engagement to help improve the reach and impact of their information. They also wanted to learn more about what layouts, content and information best resonated with audiences across different screens to shape their digital strategies. By presenting information based on customer preference, the non-profit saw an opportunity to boost engagement and expand its reach, increase clicks and time spent on site.
Using composable components that can integrate with your tech stack through open APIs is one way companies can extend those components and design elements to their tech stack to develop more engaging customer experiences.
Track metrics for continual improvement of the customer experience
The only way to know what experiences are successful is to understand how your audience responds to them. From click-through rates to engagement and conversion, it’s important to know what’s working and what isn’t and to evolve and improve the experience you’re delivering.
When NCMEC built their new site, they made sure to track, measure and manage project success. They took a hard look at all phases of their workflows and digital experiences to improve virtually every aspect of each audience’s experience. Overall, NCMEC has boosted online engagement, with 90 per cent of website visitors clicking content. NCMEC increased total website page views by 47.9 per cent in the first three months. Meanwhile, enhanced fundraising efforts drove 218 per cent more traffic to donation and fundraising pages on Missingkids.org.
“At the end of the day, every single person here can hold their head high and say that they’ve truly made a difference in this world,” says Gavin Portnoy, vice president of strategic advancement and partnerships at NCMEC.
NCMEC achieved higher engagement
90% of website visitors clicked content.
Page views increased by 47% in the first three months.
Increased traffic to donation and fundraising pages by 218%.
Source: Adobe
In our survey, 76 per cent of businesses agreed that consumers will benefit from personalised customer experience and will be more willing to share this data in the future. But the divide between that belief and how brands are executing value remains fairly large. For consumers to continue to hand over their data, it is crucial that companies and brands get the experience right and show that there is real value in sharing their data.
A new day, a new deal
As our research shows, there’s still a wide discrepancy between how consumers feel about brands collecting and using their data and what they get in return. But by embracing the core tenets of a New Data Deal, every company has the opportunity to close this gap and build greater trust and loyalty with their customers.
Some companies already know that they need to do more to improve their data marketing practices and the customer experience. In our survey, 44 per cent of companies globally said that ensuring customer data is secure is the top priority in the coming year. Additionally, 35 per cent also said ensuring data is useful to my organisation and training the company to better understand and use data would also be top priorities for the coming year.
Other priorities in 2020 and beyond for companies included training their company to better understand data (35 per cent) and use it effectively and ensuring data compliance based on current regulations (33 per cent).
44% of companies globally said that ensuring customer data is secure is the top priority in the coming year.
35% also said ensuring data is useful to my organisation and training the company to better understand and use data would also be top priorities for the coming year.