Our recent Consumer Survey highlighted the increasing customer awareness around data privacy. 84% of respondents wanted brands to be more open and transparent about the information they collect and how they plan to use it, which would substantiate that brands clearly have work to do in this area.
The public interest in greater data privacy is often misconstrued to mean that shoppers never want to share their information—our survey revealed this isn’t true. 92% of customers would still hand over their data to a brand for the right reasons or benefits. Furthermore, shoppers aren’t withholding their information, but are more selective about with whom they share it.
So how do brands encourage today’s customers to share their personal information? By mastering the art of the value exchange.
At the core of an Earned Data approach to marketing, there is a compelling value exchange. Earned Data is a customer-first strategy that seeks to obtain personal information directly from the customer with their permission to use it to improve their brand experience. Also known as zero-party data, it is rich and highly relevant information that can provide valuable and actionable insights.
Most importantly, Earned Data is the best way to create a personalized experience for customers. Having better and more relevant data on a customer allows brands to create more personalized and relevant experiences. The better and more relevant customer experience, the more likely they will return and repeat it (and share more data). And so, the cycle continues.
Tricking your customers into sharing personal information is a one-way ticket to lowering brand trust and reputation. With greater data privacy awareness than ever, brands need to be clear and transparent about why they are collecting information. If customers see that providing their data will result in an improved brand experience, they will be more likely to share it.
Value exchanges you are likely familiar with are rewards programs – where customers receive points, rewards, and level-up for spending. These programs can be considered one of the first value exchange models.
One example of this approach is adiClub, adidas’ free membership program, which rewards customers with 100 level points when they enrich their profile with personal preferences like running, golf, or tennis. Customers can immediately view these points and level-up or spend them. It is clearly communicated the preferences chosen will help adidas to tailor product recommendations. Why are rewards programs less than ideal? Because the data is not live or contextual, while gathering this information can be useful, we know that customers preferences are constantly changing.
For marketers adopting an Earned Data approach, it’s essential to get the value exchange just right. Show that the value exchange will be mutually beneficial and immediately put the collected data into action.
Here are a few tips to get it just right.
Even if the brand has the purest of intentions and the most transparent of data policies, if they ask for too much customer information too quickly, they will put customers off. Brands must start with the knowledge that shoppers are most comfortable sharing, for example, demographic information. And time the ask so they can use that information to assist the customer at that moment in the journey.
If people shop with a brand because of its sustainability credentials, offering them a cash reward in exchange for data is unlikely to be an effective incentive. Rewards don’t have to come in the form of discounts and coupons either. Our Consumer Survey showed that more people are willing to share data in exchange for better brand experiences such as exclusive access or quicker paths to purchase.
Customers will share their personal information if they see the benefit. So it follows that brands should make that benefit as straightforward as possible. And that doesn’t just include the first touchpoint with a prospective customer. Always allow customers to share more information to get a more relevant experience wherever they are in the customer journey.