Navigating GDPR: Why you don’t need to lose customers to comply
The marketing function has undergone unprecedented change in recent years, with consumers now wielding the power in the relationship between customer and brand. As a result, businesses are putting a renewed focus on customer experience (CX), using highly personalised, data-driven communications as a way of differentiating themselves from the competition. For some however, the latest data protection legislation is not only making this difficult, it is also proving something of a challenge to surmount.
A recent survey by data services company SBDS found that 76% of marketers suspect that they have missed out on opportunities because data has not been managed effectively in-house. This is a huge figure, and one that’s worth paying attention to. With consumer distrust in areas such as advertising, industry standards and data security now at an all-time high, finding the right balance between effective data usage, and protecting consumer rights is essential.
A recent survey from GlobalWebIndex found that 1 in 4 consumers are worried about the internet eroding their personal privacy, a figure which has risen from 13% in 2013. This isn’t surprising given the high-profile data breaches continuing to dominate the news in recent months. Facebook’s latest security breach, for example, put up to 90 million users at risk and landed the company with a potential $1.63 billion fine under the GDPR. So, in this increasingly complex regulatory landscape, how can businesses still deliver competitive customer experience while respecting privacy concerns?
The rise of personalisation
The ‘digital age’ has provided consumers with unlimited access to information, making it possible to compare competing products and services at the touch of a button. However, with so many options available and companies competing to be heard, it is easy for customers to be faced with the “too much choice and not enough time” dilemma. As a result, businesses are increasingly collecting and analysing customer data to tailor their communications, hoping to deliver more relevant offers which help them stand out from the crowd.
Traditionally, this has been a benefit for both parties – more interesting and relevant content for the customer and more chance of a sale for the business. In turn, customers have grown accustomed to this trade and are happy to participate if it has clear benefits for them: according to Marketo, 60% of consumers are somewhat or very likely to share their information if they think it will result in relevant, tailored offers. But with new legislation changing the way businesses collect, store and process data, how can marketers still offer the personalised service customers have come to expect?
Driving better ROI
First of all, it’s important that marketers don’t view the GDPR as necessarily damaging to sales; in fact, it will help to cut down wasted efforts. By asking consumers to actively opt-in or ‘consent’ to marketing communications, it not only ensures that every customer who receives communications, agreed to it, but eliminates individuals who have no genuine interest in the brand. Those who then choose to exchange their personal information in favour of tailored promotions, rewards and communications, are demonstrating that they are more engaged and more likely to make a purchase. Similarly, customers who did not explicitly opt-into communications no longer receive unwanted contact which alienates them from the brand.
Building reputation through trust
Although personalisation is increasingly accepted as a crucial part of good customer experience, trust is an ongoing issue, with many consumers increasingly suspicious of how their private information is being collected and used. The GDPR aims to counter this by forcing organisations to be more transparent about personal data collection. However, transparency should not stop with complying to legal obligations, but should be part of organisational culture, starting with an open and honest conversation about what data the business wants to access and how it will be used to get a better understanding of customer needs. By demonstrating responsible and secure data handling and relevancy in its interactions, businesses encourage trust from their current and potential customer bases. This, in turn, boosts the company reputation and the likelihood that new customers will be willing to share their data going forward.
Smarter data management
While consumers must consent to their data being used, it falls to businesses to ensure that the data offers usable insights. Despite this, 55 percent of marketers today don’t feel they have sufficient data and insights to drive effective personalisation. The GDPR is now forcing marketing teams to become more selective with the information they collect – from the offset, they need to consider what information is most valuable in the long term. This means harvesting ‘smart data’ that is accurate, agile and actionable, helping them to build a single view of a customer and identify insights that can be applied across the business. Customer communications management (CCM) software will start to become critical in this regard, especially as marketers will need to truly unify any outbound communications to existing or potential customers.
The GDPR will undoubtedly be causing some concern, as businesses continue to adapt their current ways of working in line with the new regulation. However, according to a recent Forrester report, businesses who make CX a core focus have 1.4-times faster revenue growth, 1.6-times the customer satisfaction rates and 1.7-times the retention rates compared to companies that don’t. For today’s customer, this means personalised, omni-channel communications from an organisation they trust with their data. With that in mind, the GDPR should be seen as an opportunity to embrace a transparent culture which, in turn, boosts company reputation and transforms CX.
For more information about Canon, please visit www.canon.co.za or follow Canon on Facebook, Twitter, Instagram or LinkedIn