With a wealth of data at their fingertips, marketers operating within the digital ecosystem, whether it’s the banking, government institutions, or healthcare industry struggle to keep a balance between data privacy and security, transparency, and marketing personalization.
Constantly on the lookout, they face a host of challenges along the way but the effort pays off, and they can benefit from personalization without compromising people’s privacy. Here’s the whole story.
Personalization goes by different names, one-to-one marketing, customization, or individual marketing. And the idea behind this method is to provide a person with content and experience that resonates with their preferences.
This marketing tactic helps organizations understand an individual’s intent by analyzing and then applying various kinds of data. With demographic, contextual, behavioral ones, marketers let people break through the noise, by offering them better value and content they look for.
Gone are the days when only the e-commerce industry was taking advantage of it. The rapidly changing digital environment proves that customers crave individually customized services also from public institutions, banks and healthcare providers.
Although these groups handle a wealth of customer data, they lag behind with personalization because of data privacy and protection constraints. But the tide is changing and even data-sensitive organizations realize the benefits and the need of adopting the content customization methods.
One-on-one marketing offers loads of benefits for both parties involved. Everyone wants to get individually tailored product and messages, and done well, the strategy brings serious profits to organizations that serve them.
But it’s a tricky business if this process involves using sensitive data, e.g. information on people’s health conditions or the amount of money on their bank accounts. We’ll present to you some key sectors that hold such data, and discuss how they can still leverage personalization with extreme caution to privacy and with respect to user rights.
But first, let’s have a closer look at different issues and obstacles involved in these tactics.
Organizations that want to capitalize on one-on-one marketing, need to realize they’re entering a bumpy road. They will need to overcome numerous issues, from legislation requirements, secure data storage, privacy paradox, establishing user identity to inappropriate personalization.
Privacy regulations play a leading role in personalization struggle. The regulatory landscape has been rather stable until the European Union’s GDPR came into force causing a chain reaction where many countries across the globe follow suit. Think of California Consumer Privacy Act, Brazilian General Data Protection Law (LGPD), Chile Privacy Bill, China Internet Security Law, New Zealand Privacy Bill, just to name a few.
There’s no space to dwell on the details of each one, but you’ll find here a wider perspective on the legal background you should get familiar with.
Starting from the top, GDPR, the most stringent privacy law ever introduced. Designed to increase protection and harmonize data collection from individuals across the European Union. It applies not only to EU-based businesses but to all organizations providing services for customers within the EU territory.
GDPR set the model legal framework that new laws, like CCPA, LGPD, Chile Privacy Bill Initiative, New Zealand Privacy Bill, have been adopting as well. One of the shared principles is the obligation to obtain informed, active, unambiguous, and granular consents.
As a website owner, you must acquire users’ consent before you begin tracking personal data. Since cookies, the online identifiers, fall under this definition, if you apply them then you need to comply with these requirements.
However, there are some essential differences between these legislations. For instance, the CCPA, contrary to European law, is primarily focused on sales of data, not gathering and processing it. The CCPA’s main intent is to grant Californians the right to know what personal information businesses gathered about them and to disagree with selling it.
Then, comes another player, The Cyber Security Law of the People’s Republic of China, better known as the China Internet Security Law. It requires storing Chinese citizens’ data on local servers regulated by Chinese law.
Businesses are obliged to cooperate with the country’s authorities, e.g. the security agency will be allowed to perform random checks on an enterprise’s network operations. That could jeopardize your organization’s secrets and sensitive information.
Rapidly growing volumes of information bring further challenges, one of the key ones is secure data storage.
The bar is raised even higher for companies in tightly regulated industries, like healthcare, financial institutions, government as they handle a plethora of data, including sensitive. That calls for extra safeguards. Otherwise, you put your business at risk of hefty fines or loss of reputation.
The more valuable data, the bigger the peril. Above all, personal information of customers, patients and citizens is a potential target of criminal activity and malware. Other threats related to data safety involve data leaks, breaches, or even total loss.
However, not all jeopardy concerns cyberattacks. It could be as simple as:
Still, the protection measures must be implemented by design, so your data is safe and sound.
Despite the growing concern of data privacy, online users rarely make an effort to protect it and give it away voluntarily. Gartner’s latest survey reveals that people share their personal information in return for ease, comfort, and experiences tailored to their preferences. And that’s exactly the privacy paradox which shows a serious disparity between users’ attitudes and what they actually do.
On the one hand, new privacy regulations spring up like mushrooms and people demand tighter data controls by requesting the right to delete, erase their personal information or any digital traces they leave. Also, see the proliferation of mechanisms for flagging trackers, like Apple’s Intelligent Tracking Prevention, VPN’s, or ad blockers.
At the same time, despite privacy scandals like Cambridge Analytica or Google+ exposure of private data of half a million users, people still share their private details, use services that compromise their confidential information. And Facebook’s increasing profitability is one of the best examples of that trend.
Reaching people online with personalized messages and offering seems to be an easy feat with an abundance of data ready for grabs. However, establishing the user identity with absolute certainty proved to be problematic.
Too often the data sits in silos all over the digital landscape, be it different channels, devices, or platforms. And stitching it together to identify a person is more than a challenge.
For starters, you can’t obtain a persistent ID on web browsers, so consistently pinning down the identity of an individual is complicated. The major issue here is cookies. They’re very limited, i.e. they can only be read by the domain that created them. That’s why running targeted ad campaigns often requires two or more advertising technology platforms to perform cookie syncing, which is error-prone and increases page load time.
And they weren’t designed for a multi-device reality. On mobile devices, they are reset when a user simply shuts down the browser. Also, it’s impossible to pass them from one device to another or share them between browsers.
It turns out that personalization, a marketing’s holy grail, can be a problem to customers. It’s a matter of crossing the fine line between a precisely tailored experience and invasive or even creepy marketing.
It happens if you go too far and make people uncomfortable. They feel being followed, realize they amount of intimate and sensitive information is being gathered on them without their permission or even awareness. It erodes customers’ trust in your brand.
Consider, Target’s case of predicting teenage girl’s pregnancy and insensitively mailing maternity ads to her, even before her dad knew that the baby is on the way. Or, when a man in assisted living gets a Christmas basket from the mortuary. What about a woman who gets a reminder for a prostate examination, because her name’s Daryl.
However, the misuse of personal information for customization marketing could be much less dramatic. See incentives for getting a credit card for clients when they already have it, or sending a newsletter with a discount for a dental checkup to a person who is not your patient anymore.
For the data-sensitive industries having public trust is essential and holding it should be the groundwork for their marketing strategy. Finding the sweet spot between effective personalization and intrusive communication is tricky.
But with the right approach, this road will be much smoother. So, here’s the shortcut.
Transparency in the digital world means, above all, that you ask people to obtain their personal information. You’re clear about how you gather it, what exact data bits you gather, finally where and for how long you’ll store it.
Here are a couple of recommendations:
Still, transparency is not only limited to privacy. Across different industries, it can have a slightly different meaning, but in general, it implies that you’re upfront about product features, transaction fees. No hidden costs, no ambiguous terms of services.
All that paves the way for people to have confidence in your organization.
Moreover, you need to sign a legal agreement with both parties involved (the data controller and processor) that have access to personal data of your site visitors. This is called a data processing agreement (DPA) and it regulates managing data in terms of its scope and purpose, then establishes the rights and obligations of each party regarding data safeguards. It ensures that both actors in the partnership work in compliance with GDPR or other relevant privacy regulations.
People who come to your site leaving their digital footprints allow you to use them in exchange not just for the tailored experience but for greater value. Whatever business you operate in, once you get data on people’s past and present interactions, transactions, order history, likes and preferences, transform them into better service.
Irrespective of the business field, people expect to get fully digital experience, have their questions answered right away, be able to verify their request status, and activities, finally, the ease to find what they’re looking for.
Data-sensitive businesses, thanks to a plethora of personal data they collect, partly due to regulations, can better and faster address these issues to improve their relationship with customers or citizens.
After you obtain sensitive information from your citizens, clients or users, you should handle it with the utmost care and use it in a responsible manner. That translates into relevance, transparency and ethics. You can achieve that by creating value for users, built around principles of privacy, protection, consent and data ownership.
To employ personal information responsibly:
Marketers from data-sensitive industries must be aware that one of the key factors in people’s decision to share their confidential details with your organization is the trust that data is secure. That’s why it’s crucial to have control and full ownership over data, so getting it anytime and deciding who else can access it.
The recipe for protecting your customers and users’ private information, is having it within your secure perimeters, such as your own servers. Bear in mind that cloud service providers hold data worldwide, switch from one data center to another and that can cause security issues, for instance, where exactly your data is.
That’s one of the reasons why countries like Australia, Canada, Germany, India and Switzerland have it legally regulated to store data only within their country borders.
Data safety requires also:
Once you know exactly how to acquire and handle user data, especially the sensitive kind, it’s time to put this information into practice.
The public sector has realized the importance of following digital trends to meet the needs of its citizens with modern services.
According to Eddie Copeland, Director of Government Innovation at Nesta, “Personalized government would suggest other services based on a person’s age, demographic or location. For example, why not be prompted to sign up for organ donation or giving blood when renewing a driving license online?”
What’s more, as a governmental agency you could improve your processes by, for instance, recommending a person filling out a certain form if they’re filling out related one. Also, helping citizens:
would be a great fit for personalization.
On the other hand, if you represent a healthcare brand, this method lets you better take care of the patients and customers. You could provide assistance to new mums by sending them tailored messages about caring for a baby and family, answering questions that may arise in this new situation.
Or you can be more helpful to a specific audience, e.g. women with breast cancer, by offering them additional services like psychological support or some materials related to self-help addressing their specific needs.
Also if you operate within the financial sector tailored offerings should be your core marketing strategy. You can:
By meeting their customers’ and users’ expectations, data-sensitive industries will be able to enhance the overall experience of their services, improve relationships with citizens or customers, increase engagement and loyalty. The question is how to do that without giving users creeps and the unpleasant feeling of being constantly tracked, even during the most sensitive online operations.
Taking advantage of personalization without putting customers’ privacy at risk is like walking a tightrope. However, marketers can keep balance if they follow some golden rules. Here’s the recap.
To overcome these challenges, marketing teams need to be aware of legislative requirements and adjust to them. Then ensure transparency within communication, services, and documentation, implement proper consent collection processes to build trust and guarantee legal compliance.
Moreover, assure that all tools, software and database you employ, work in line with privacy regulations. And from cookie collection and processing, through the integration of marketing toolkits and data storage, you have it all covered in the DPA.
The bottom line is to make the “privacy-first” the northern star of your tactics and respect your customers’ choice on private details they share. In this way, you can offer an excellent personalized experience, inspire clients’ loyalty and finally drive your revenue without posing a threat to your business.
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