Before we saw the headlines, we noticed it: The fast-growing number of brands alerting us – or asking our permission – to collect our personal consumer data as we visited their site. It’s not always ideally executed, but it’s a good step in the right direction as marketers realize the urgency to balance consumer privacy and grow customer relationships. But it’s not enough.
Marketers know the paradox that they can lose customers they don’t know enough about, and lose customers if they know too much about them, especially without their permission. Finding and keeping that balance is becoming increasingly precarious as consumer data privacy concerns rise and legislation like GDPR in Europe and now CCPA here in the U.S. go into effect.
Marketing strategies and technology are rising to meet the challenge, like the 360-degree view of CDPs (customer data platforms), but the exact challenge must be understood first.
The Impact of CCPA
The California Consumer Privacy Act (CCPA) is the most stringent consumer data privacy legislation in the U.S. And it’s not going to stop there, expected to spread across the country. Federal laws will likely emerge, too. It will be complex and demanding. The message is clear: The time for lip service is over and marketers need to commit to a privacy policy that is consumer- and government-compliant.
As consumers gain power over their information, the rules are changing. But that doesn’t mean businesses can go back to marketing blindly, ignoring one-to-one relationship building. Data can still drive customer relationships, but permission will be required, unlike the invisible site cookies of the past.
The Cookie Crumbles?
Cookies with tracking code snippets called pixels are behind ads that follow consumers online and chase you around with a product you just looked at — or worse, something you just purchased. Some sites offer a choice to accept cookies, while others just inform you that they use cookies. However, not accepting cookies can impede the functionality of that website, such as blocking a purchase. Not a good look.
Mostly marketers are focused on being upfront with consumers about what’s being captured on the website to better guide their visit, deliver a more rewarding experience and create a valued relationship. They are attempting to source their data correctly and they are trying to be transparent about it.
Digital point solutions are largely driven by identifying and tracking customers via cookies and pixels as they navigate across the web. And that’s a problem.
Some cookie aggregators now present themselves as a unified identify system, but as new consumer data privacy regulations define cookies as personally identifiable information (PII), they lack the required mechanism for consent.
Dubious Data
The problem lies in snaring and leveraging consumer data without permission, usually third-party data where there is no consent or permission involved. The value of consumers’ data is out of their hands, as is the messaging that confronts them. That’s not going to fly anymore.
Marketers need permission-based PII to succeed in direct marketing, clienteling in the store and service in the call center. We now need to connect the PII to the digital identity graph so we can govern digital advertising, social advertising, etc. Without the complete single view of the customer based on PII, marketers cannot provide the mechanism for privacy and consent that consumers demand. They need to operate with first-party data and a 360-degree view of the customer.
First-Party Data and CDPs
CDPs have emerged as a strong resource to gain that 360-degree view and in the process comply with new regulations.
Having a CDP makes it easier for brands to collect information, but also more efficiently respect opt out preferences by centralizing the customer view. Data is not purchased via a third party.
That view makes both relationship building and compliance actionable. The brand can first reach out to consumers to share the data they have and ask if they still want communications across these channels. If there is an explicit opt in from the customer, the brand can confirm they still want to receive communications. And since the CDP is omnichannel, if there is a bad email, the business can use their mailing address to get a real take on their preferences.
The CDP also offers the opportunity for the brand to clean its house file, keeping it up to date and genuinely compliant, while making sure all the necessary information is there to move forward.
Being the holder of this data, brands need to tell consumers explicitly how they can obtain their personal data and if they wish to have their profile deleted (or returned back to them) from a brands’ database.
Trust in 2020
Trust will be a bigger issue than ever in 2020 both in terms of respect and abuse. Consumers are getting smarter about their information and laws will give them the power to protect that right. It’s not a line that marketers want to cross.
CDPs have emerged as a customer-centric solution with a comprehensive view built on first-party data and PII to connect customer behavior online and offline. It’s a mechanism to protect consumer data privacy and respect their preferences, while giving marketers the ability to stay current and act on those preferences.
The demand now is for transparency and action. As some brands have already demonstrated, being open builds trust. That’s the opportunity going into 2020 and beyond: To not just comply, but to take the initiative and communicate with customers on their terms, while responsibly using data to deliver a customer experience that inspires loyalty.
Despite the doomsday overtones as these consumer data privacy issues intensify, this can be a time of opportunity for marketers and their customers, evolving their relationship to new levels of trust and value on both sides. And that shouldn’t be a secret.
Denise DeSisto is VP, marketing automation and product innovation at Customer Portfolios