Technology May 26, 2016 Last updated September 18th, 2018 2,994 Reads share

7 Ways to Accumulate Customer Data Without Losing Trust

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It is no secret that businesses, nowadays, rely on customer data to make strategic decisions and personalize marketing. With the growing prevalence of the era of big data, businesses are increasingly leveraging its potential to provide a more customized experience.

Analytics have become more powerful than ever. With the emerging tools, business intelligence professionals can now keep track of how much time users spend on their website, their behavior on their website, the mouse clicks and so on.

Even though this technique has proved to be quite beneficial and has garnered customer satisfaction, gathering such personal information is still a sensitive topic. With an escalating number of incidents concerning data theft and breach of privacy, collection of valuable customer data has become quite tricky.

With a large number of landmines, collecting customer data can annoy, anger and scare them.

But the good news is that there are ways to accumulate data without losing customer trust. Let’s take a look at some of these in details.

#1. Build Trust

In a recent study to identify customer preferences, the following facts came to light:

  • 60% of the consumers surveyed personalized, real-time offers from retailers.
  • Only 20% of the consumers are comfortable with sharing their location with the retailers.
  • A mere 14% of them want to share their browsing history.

Clearly, customers are conflicted.

The best way around this problem is to earn the trust of your consumers. Only then will they be comfortable to share their personal information. Be patient, try to understand their requirements and, most importantly, ensure that the information you provide is credible and addresses their problems.

According to Dave Richards, global managing director of Accenture’s retail practice, “If retailers approach and market personalization as a value exchange and are transparent in how the data will be used, consumers will likely be more willing to engage and trade their personal data.”

#2. Ask for Permission

One of the common ways of data collection is by offering free WiFi to customers. With the incentive of a free browsing session on the Internet, customers rarely think about giving out their information that companies ask for before they are allowed access. Even though that might sound like a smart way to gather customers’ information, it is always wise to ask for permission first.

  • Be very clear and upfront about why you are asking for this data.
  • Always provide them with the chance to opt out if they are uncomfortable.

That being said, this does not have to mean losing out on valuable data. You can always provide them, with immediate incentives like discounts, free content and so on.

Colin Light, digital consulting leader of PwC Hong Kong and China suggests, “According to our recent survey, users across the board are very willing to trade information provided that marketers are transparent about it and offer a fair value exchange such as free content, money off something or experience through a particular brand.”

#3. Be Transparent

As many as 60% of online users want to know why, what and how websites choose contents that are personalized for them.

Transparency can lessen a lot of concerns.

In a survey conducted on 385 respondents to understand the impact of a company’s data collection practices on customers, 30% said that they would be less bothered about sharing their personal information if companies told them the data they are collecting and the reason.

According to Dave Jackson, CEO of Clicktools, a company that specializes in assisting companies with the collection of customer data, “It’s not just about what information I’m holding, it’s about how I’m using that information. And if you can show someone that you’re using that information for mutual benefit, that will build trust and benefit both parties.”

#4. Have a Privacy Policy in Place

While being upfront about the purpose of data collection can allay a lot of worries for your consumers, it is important to lay down certain rules about the usage of data.

There is a thin line between using personal information of your customers and misusing it. And this line should never be crossed. This is where a privacy policy comes in. This will not only make your customers more aware of what their data is being used for but will also take care of all the legal concerns that may arise at a later stage.

#5. Keep the Data Anonymous

With the increasing significance of privacy of user information, keeping the data anonymous is vital. Ensure that the data you collect is free of identifying information. For this purpose, you can consider clustering models.

This method uses algorithms, instead of marketers, to create customer segments. This increases the number of variables that are considered to create these segments. It also removes bias and keeps the data safe. This way, access to the data is restricted to algorithms only and not marketers, thus keeping the personal information confidential.

Including the anonymity criterion in the privacy policy would be a good idea since this will encourage your consumers to trust you.

#6. Avoid Collecting Data if You Don’t Intend to Use it

When you ask for data, you automatically build an expectation of an incentive among your clients. This is because the basic idea behind the collection of data involves rewarding the customers by providing them with a more tailored shopping experience.

Now, collecting valuable customer information and allowing it to just sit in your vast database without any intention of using it can cause suspicion and distrust among your customers. Additionally, this is also just a waste of money and effort.

#7. Collect the Data That You Need

With an access to your customers’ personal information, it could be tempting to gather and store as much data as you can. While that may turn out to be quite intrusive, it could also mean a massive waste of your time and resources. Therefore, it is always advisable to collect only the data you need.

It goes without saying that companies should always stick to legitimate methods for accumulating data. The numerous data collection methods that companies adopt include newsletters, asking customers to register before offering WiFi, conducting surveys and so on. No matter which method you choose, you should always ensure that the lines of communication between your company and your customers are always open and their requirements are given top priority.

Images: ”Customer Data words on an envelope or direct marketing mailing to illustrate contact information or database of consumers and demographic information /


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Steven Scheck

Steven Scheck

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