Can You Provide a Personalized Experience Without Triggering Data Privacy Issues?
Two major events in 2018 made users super aware of how their data is being used. The Facebook–Cambridge Analytica data scandal made all the headlines and we were shocked at how our data was abused. After that, GDPR enforcement in May 2018 made EU users feel safer and in control. They now have to give consent for their data to be collected. On the other hand, while US consumers would welcome personal data protection rights similar to GDPR, other research shows that 71% of consumers want a personalized experience (Forbes 2019). This creates a paradox for marketers to solve. While some are failing to find a suitable replacement for purchased third-party data, others are using the situation to both comply with privacy policies and make their users happy.
The Depth of Privacy Paradox
While we’re very much aware that our data is being used, especially in post GDPR world, we still tend to skip Terms and Conditions – we just don’t have the time to read through them. We’re also likely to document our lives on each step. Finally, users don’t ignore ads – an average Facebook user clicks on 8 ads per month and e-commerce click-through rates on Facebook have tripled in the last two years (Hootsuite 2018). Having these stats in mind, it’s no surprise that everyone wants to use the abundance of data that users are publishing on their profiles. On the other hand, customers find it very creepy when brands know something that they didn’t consent to share directly with them. Businesses are often not aware of the consumer sentiment when it comes to the use of personalized content in advertising (Hubspot 2018). Even if they’re complying with policies, the fact that users are unaware of how they got info on them can be brand damaging, as customers are becoming increasingly distrustful.
As a consequence, buying third-party data doesn’t look like a viable option anymore. Third-party data was never overly reliable. Did you ever look for a pair of shoes, found them and bought them, only to be bombarded by the ads with similar or the same shoes on them? It’s a leftover cookie that collected a no-longer-relevant piece of data and ads that are being served based on it make no sense and only serve to aggravate the user.
Forrester gave a definition of zero-party data that "a customer intentionally and proactively shares with a brand. It can include purchase intentions, personal context and how the individual wants the brand to recognize her" (AdAge 2019). The fact that a customer is willingly sharing the data means that there’s no guesswork involved. This also means a direct relationship with the user that acknowledges their choices about which data to share and results in trust. Combining this with first-party data you’re collecting about users, gives you an upper hand in developing different strategies for prospects and customers, building long-term relationships, and providing a personalized approach.
Giving Users a Reason to Share Data
We keep repeating the same thing – honesty is the best policy. Users are not ignorant. If you ask them often to share info that they didn’t want to share to start with and give them a huge “Yes” button and a tiny “Not now” button, you’re likely to trigger negative emotion towards your brand. When users are directly asked to share data and given the reason behind it, they are more likely to reconsider. You can ask them once and let them know that they can change the settings easily whether they say yes or not.
The trick is to provide some value in exchange for willingly given data. A great example is YouTube and music apps in general. We want them to learn our preferences and make custom recommendations and playlists that suit our interests. In order to be able to do this, the app needs to collect data. Most of the users will willingly give this data, because of the fact that it’s being collected directly conditions user experience improvement. In my personal experience, while I’m increasingly annoyed by the amount of pre-, mid-, and post-rolls on YouTube, I’m not keen on choosing a new music app, the sole reason being that YouTube has years of data on my preferences. Sure, YouTube is free, but for me as a user that doesn’t make much difference, having in mind that there’s a bunch of affordable music apps that respect their users and don’t show the same commercial over and over again. It’s precisely the personalized approach that is possible based on years and years of liked videos, playlists, etc. that’s keeping me tied to this app.
The Ways to Ask for Data
A lot of brands will ask for your phone number or email so that they can send special offers your way. Once you do have a direct route to their inboxes, a great way to learn about your customers and create audience segmentation is by asking which kind of content they want to receive from you. For retailers, this can be a choice of product type or brand, while publishers who offer a lot of different content can ask users to opt for topics or segments they are truly interested in. There are also a lot of types of interactive content (like polls or social media posts) that can outright ask for user preferences. Again, while this is an easy way to collect zero-party data about users, it also lets them know that they are important and respected by the brand. It also allows you to deliver the desired value to the users, without forcing unwanted ads upon them.
Here’s a few elegant ways to approach your audience:
- Collect order info
It is crucial to collect data from users who are placing an order on your website. Asking for data regarding name, address, and date of birth, in combination with the purchase info can be a powerful retargeting tool. You can even take it one step further and add an optional “Let us get to know you a bit better” form at the end promising customized offer and other conveniences. In any case, it’s important to be transparent and give the users an option to choose if they want to be contacted or not (preferably a checkbox). As always, be honest and let the user know how the given data will be used.
- Ask directly via a survey
Sometimes, users will willingly give you info about them if you’re being fully transparent. Ask them to fill out a survey aimed at improving their experience. Make sure to give them the option to skip the questions they don’t want to answer in order to decrease the bounce rate.
Users are more likely to give you their info if there’s free stuff involved. Organizing a giveaway or a competition is a perfect way to gather zero-party data quickly. Ask them to fill out a form and accept being targeted with custom messaging moving forward for a chance to win a brand-new laptop. In the long run, the value of the data outweighs the price of the laptop.
When it comes to the users’ POV regarding their data, the cat’s out of the bag. Everyone is aware of advertising and why brands need info on potential customers. However, this doesn’t have to be a bad thing. It’s up to marketers to approach users directly and with honesty. Willingly shared data marries the quest for the personalized experience with data privacy consideration.