When the General Data Protection Regulation (GDPR) goes into effect in May, marketers will need explicit consent from EU residents to store or use any of their data.
The regulation comes with a hefty fine, so marketers have at least 20 million reasons to comply. This will ultimately result in greater transparency and greater trust, which is often missing for consumers. Forcing marketers to have more accurate, cleaner databases, the GDPR will also lead to better personalization. In control of their data, consumers will create an environment in which they’re telling marketers exactly how to target them.
Content produced in association with SmartFocus.
Personalization is essentially the point of Big Data. Marketers utilize data in order to deliver the personalized experiences consumers crave.
In addition, personalization gives people a sense that brands care about them, increasing sales. According to 2016 Accenture research, 56% of consumers are more likely to purchase from a retailer that recognizes them by name.
At the same time, personalization also prevents “the paradox of choice,” or the idea that too many options gives people anxiety and increases the likelihood that they won’t choose anything. Netflix certainly thinks so. The company’s data shows that without relevant recommendations, subscribers lose interest in as little as 60 seconds.
Personalized marketing can be a double-edged sword, with a thin line between adding value and fueling paranoia. Microsoft surveyed 16,500 consumers and found that 56% believe brands collect data with and without their consent. The average person doesn’t understand how brands actually collect the data, which contributes to a sense of distrust.
Think of that famous Target example. A Minnesota man stormed into his local Target, demanding to speak to the manager about the coupons for baby products his teenage daughter received. It turned out, she was pregnant. Retailers can determine pregnancy and even a woman’s due date, based on purchase data; lots of unscented lotion often signifies the second trimester.
Most people don’t mind when marketers have their data—as long as it’s on their own terms. According to Columbia Business School research, 75% of consumers are happy to share their data with brands they trust.
People decide which data sets determine the ads they’ll see. This eliminates the feeling that they’re being spied on. And when people feel more comfort and trust toward a brand, they spend more money. Amazon is more profitable than ever and consumers trust the ecommerce giant more than any other brand, according to Cohn & Wolfe research.
Of course, the GDPR promises to challenge marketers before it makes their lives easier. Challenges include documenting exactly what data your company collects (and how you both obtain and use it) something most organizations struggle with on the best day. You must make sure your procedures are aligned with people’s privileges, such as the right to have information deleted.
You must also have a data breach process in place and designate a head of compliance, among others. The checklist is long and that’s before factoring in any updates to your tech stack.
CA Technologies found that only 33% of organizations feel confident they can promptly identify all of the data they hold on every individual. Technology helps audit data, as well as handle other tasks the GDPR makes imperative, such as gaining a single view of the customer, linking data assets together and categorizing them against individuals, and allowing consumers to control their data.
When the GDPR becomes legally binding on May 25, marketers will have less data to work with. That sounds daunting, given that data makes personalization possible. But the data they have will ultimately be better, since consumers are telling marketers exactly how to target them. This improves the overall experience in a way that benefits everyone, marketers and consumers alike.
The Golden Rule dictates that we should treat people as we want to be treated. The GDPR takes it one step further, giving marketers no choice but to adopt the Platinum Rule: Treat people as they want to be treated.
To learn more about how marketers can seize the opportunity with the GDPR, read SmartFocus’ ebook, “GDPR: How Marketers Can Seize the Opportunity.”Reblogged 1 year ago from www.clickz.com