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- 2018-2020 will be remembered as when marketers who think about customer data and customer experience (CX) were called to focus on privacy-by-design.
- Contextual interactions across these channels will be key to getting them to come back to your website, app or physical store, with interactions becoming valuable first-party data over time.
- As CCPA goes live in one month and other states’ privacy legislation looms, third-party data like IP addresses and device data cannot be used across supply chains where brands lack visibility.
- The ability of businesses to target ads and their audience scale will be dramatically better than newspaper and magazine publishers, giving them pricing leverage in the marketplace.
Mike recently wrote on ClickZ about what the privacy era means to mobile apps and customer experience. For this piece, he looks at what marketers need to concentrate on after they’ve adopted a privacy-first mindset.
By now, marketers should already know about the considerable impact of the General Data Protection Regulation (GDPR), Europe’s 19-month-old, sweeping privacy legislation. And they should have already had their plan in place for the California Consumer Privacy Act (CCPA), which goes into effect in January and will likely inspire similar policymaking elsewhere. In short, 2018-2020 will be remembered as when marketers who think about customer data and customer experience (CX) were called to focus on privacy-by-design.
Brands can win in this new environment—they just need the right guidelines in their playbook. Here are four rules for the privacy era.
Rule #1 – Act in your customers’ interest
First, take a long, hard look at your data operation, including your data collection, your data partners, your ad-tech partners, etc. Are there areas where you’re buying third-party data? If so, look at whether the data sources are compliant with regulations, and develop a plan to maintain confidence that they remain so.
A few more questions to ask to get to the bottom of things: Can you identify clear consent mechanisms for all the data you’re using? Can you satisfy consumers’ requests to “be forgotten?” Do you feel confident customers understand your data practices? Are there things you aren’t clearly explaining, and if so, why?
It’s important to put your customers’ interest first. The experience they have with your brand will determine whether they become loyal patrons and spread positive word of mouth.
Rule #2 – Be transparent: Ensure customers know what they are opting in to
Sometimes, publishers and brands have been giving viewers the option to decline – but not very often. Note that a majority of sites in Europe only offer a “Consent/Accept” button, which doesn’t seem like a customer-first mentality. The retail example below compels the viewer to “Accept and Close” as if a mutual agreement was a foregone conclusion.
If you are worried about too many people tapping “Decline”, then A/B test different message flows, timing and copy – some designs with Decline, some without – to see the impact. And then your team can make an informed decision. But remember you are no longer operating in the web era when it was considered a best practice, as just one example, to make email sign-up a one-click process while unsubscribe is buried and requires three or four clicks. Providing a great CX now outweighs old-school, blunt-force, audience-preservation tactics.
Rule #3: Engage intelligently
In parallel, get them to opt into your brand’s messaging via text, email, push notifications or even mobile wallet coupons. Contextual interactions across these channels will be key to getting them to come back to your website, app or physical store, with interactions becoming valuable first-party data over time. To achieve these direct audiences at scale, your team should A/B test different benefits and calls-to-action to find out which words, images, offers, and features produce the greatest number of opt-in users with low churn score predictions.
In this privacy era, first-party data will power your ability to build relationships as your brand increasingly gets to know customers. Your marketing team will be able to leverage that intelligence with more relevant offers for every stage of the customer lifecycle, triggering interactions in real-time throughout customers’ journeys guided by machine-learning predictions and rich behavioral profiles.
To lift engagement, give customers a granular preference center that lets them pick their preferred channels, topics, and ideal frequency. And gather as much behavioral data as you can because it could be the difference between keeping a customer and losing him or her. Sending customers too many emails or texts should not be part of any brand strategy today. Consumers should have the ability to personalize the cadence of brand messages to them, and brands should utilize data to know when and where to reach individuals. The stakes are high.
Rule #4: Prioritize customer retention
The privacy era will help brands generate better ROI. Here’s why – ads on social platforms like Facebook/Instagram, Google, Twitter, and Snapchat are getting more expensive. And as Mary Meeker recently stated, this reality makes customer acquisition costs unsustainable for marketers.
Emerging headwinds for customer growth mean brands need to tip the scales from acquisition to retention. As CCPA goes live in one month and other states’ privacy legislation looms, third-party data like IP addresses and device data cannot be used across supply chains where brands lack visibility. This will further entrench the walled gardens, which have a wealth of data and have more easily gained consumers’ consent to use it, which, like GDPR, the CCPA requires. Their ability to target ads and their audience scale will be dramatically better than newspaper and magazine publishers, giving them pricing leverage in the marketplace.
All told, ROI concerns should give brands in the privacy era more reason to focus on customer retention and build their trove of first-party data. It costs six times more to gain a new customer than to retain an existing one, and the price tag on acquisition is only getting higher.
Apply the new rules
In sum, the privacy era doesn’t have to hurt the customer experience. In fact, it can help brands improve the transparency of their CX by more clearly obtaining consumers’ consent and giving them control of their data. Marketers, in turn, can move from targeting consumers to developing customer relationships, shifting ad dollars to investments in digital utilities and conveniences that pave the way to better customer understanding and stronger long-term loyalty.
The Wild West days of being followed you around the web are coming to an end due to incoming legislation as well as new privacy differentiating features from companies like Apple, Mozilla, DuckDuckGo and others. Brands that sense of the sea change and embark on new frontiers will thrive now and well into the future.
Mike Herrick is SVP of technology at Airship, a customer engagement platform.