Guest post by Natasha Lane.
Over the past three years, data privacy has received a great deal of media attention, driven mainly by the implementation of GDPR in the EU. Since 2018 when the law passed, international legislative authorities have implemented several international equivalents, the latest ones being Brazil’s LGPD and California’s CCPA.
Yes, privacy legislature is excellent news for consumers, especially when considering the consequences of data breaches. Nonetheless, the rules can be overwhelming for marketers just trying to do the right thing.
One of the biggest concerns for businesses is that all information capable of identifying a consumer (name, email, IP address, server location, etc.) falls under these privacy regulations. And not just that.
In addition to the data a business uses directly, companies are also responsible for their marketing/analytical tools. Being legally bound for the way Google Analytics, for example, uses consumer data is nothing if not stressful.
With that in mind, it’s a good idea to re-think your use of data in 2021. Ideally, you want to find a balance between personalized marketing and relevant law compliance.
The Benefits of Personalization
With all the rules and regulations, you might be thinking that personalized marketing isn’t exactly worth the effort. Not true.
Personalized marketing messages offer a wide variety of benefits to both consumers and sellers. These include improved user experience, more efficient ad targeting, enhanced brand loyalty, and importantly, higher conversion rates. Moreover, research shows that Internet users aren’t all that opposed to their data being used by companies, as long as they receive value from it.
A 2017 Deloitte survey found that an increasing number of Internet users in the U.S. would be willing to share their website browsing and social media activity—that is, as long as they got something in return.
Netflix is a great example of a business that uses data to boost user experience. The streaming service’s movie recommendations are based and even presented in light of past activity. According to the service, they look at data such as:
- Viewing history
- Interactions by similar users
- Information about consumed media
- Time of day
- Device use
- Time spent watching content
By analyzing a wide variety and large quantity of data, Netflix is able to provide a streamlined experience that reflects the user’s preferences and encourages further content consumption.
Another considerable benefit of personalized marketing is its ability to drive engagement across multiple channels.
There are over 4 billion social media users globally, and the majority use multiple platforms on a regular basis. With Facebook, YouTube, WhatsApp, Instagram, and TikTok leading the race, there’s already a wide variety of networks for businesses to cover.
Add search engines, email, media, and company websites, and it becomes clear that a stellar marketing strategy needs to ensure a homogenous experience across all these distribution channels.
By implementing personalization strategies, you can not only influence consumer behavior. You can position your business as a reliable source of products or services.
And it’s absolutely manageable without being “creepy.” Being consistent with the products you recommend, being mindful of people’s expressed preferences, and preventing excessive repetition are already steps in the right direction. Furthermore, pay attention to the dos and don’ts of marketing personalization, and think of the process as a UX strategy instead of a sales tactic.
Finding Balance Between Personalization and Privacy
In 2021, there’s still quite a lot of room for improvement in privacy practices, especially among small businesses. According to Havoc Shield, 22% of small businesses suffered a security breach in 2020, had an average of 43 user profiles on the dark web, and only 29% required two-factor authentication. Clearly, this can be worrying; there’s still quite a lot that companies (big and small) can do to protect their customers.
A data privacy plan consisting of five essential steps can be very helpful in achieving that coveted balance in 2021. By implementing the following actions, you can get the best of both worlds: security and personalization.
1. Do an Audit of the Data You Keep
The first step towards compliance with the relevant regulations is to take a look at the data you already have and create directories and plans on how it is to be used.
The best practice is to create a personal data inventory that will organize all the data you collect in one place. This will include elements like names, locations, and contact details, as well as behavioral information. An inventory will allow you to have a clear overview of this information, along with pre-defined instructions on how to use, store, and dispose of it.
2. Identify Your Personalization Goals
The second step towards treating your customers’ information with respect is defining clear goals for using the data you collect.
Ask yourself: what do you want to achieve with personalization? Perhaps you want to make your email messages better tailored to your customers? Or to offer more relevant product/content recommendations?
On the whole, the best course of action is to only implement uses that will offer value to your customers. Yes, people will likely want article recommendations that reflect their interest in topics. However, the convenience of such a feature quickly loses its appeal the moment it starts jeopardizing privacy.
3. Get Rid of Data You Don’t Need
Once you’ve gone through the info you collect and have set clear personalization goals for improving your website’s UX, delete everything that’s problematic or that you’re not using. In addition to being generally more respectful towards your clients, the removal of unnecessary data from your databases also helps you mitigate risk should you experience a security breach.
It’s also important to allow consumers the right amount of influence over the personal information you collect, by giving them the ability to consent to the way you use their data.
4. Be Transparent
As the key driver of trust between consumers and brands, transparency is crucial if your goal is to provide customers with an improved buying experience.
5. Have an Incident Response Plan Ready
The final step to improve your use of personalization in 2021 is to prepare for the eventual worst-case scenario. Unfortunately, there’s a one-in-five chance that your small business will be a target of a security breach, so it’s better to be cautious up front than to deal with the consequences later.
You can help prevent cybersecurity issues by following the tips provided by the Federal Communications Commission. Train your employees, invest in any necessary software solutions, secure your connections, and limit data usage.
Moreover, make sure to update your policies and practices as often as needed. And, of course, keep in the loop regarding any new rules and regulations.
There’s a fine line between a business collecting data to improve user experience and it exposing its customers (or itself) to cyber attacks. With this in mind, leaders and marketers need to have an understanding of data privacy in 2021.
Tt’s better to err on the side of caution when it comes to customer information—not least because of the significant fines for failing to comply with the increasingly complicated rules.
So, if you’re going to use personalized marketing, make sure that it’s through practices that offer value to your customers. In the end, they’ll be much more likely to make you their go-to supplier if they believe you’ve got their best interest in mind.
Natasha Lane is a lady of a keyboard and one hell of a geek. She is always happy to collaborate with awesome blogs and share her knowledge about branding, digital marketing trends, and business growth strategies. To see what she is up to next, check out her Twitter feed.