Every day it seems companies like Facebook, Google and others are constantly updating their data privacy guidelines, causing many users to be concerned over how their personal information is being used. But that concern can be overcome by companies if they use the knowledge gained by analyzing data to improve products, services and experiences customers have in dealing with them.
Wilson Raj, Director of Customer Intelligence with SAS, discusses the results of a recent survey of 1,200 U.S. consumers around the issues of data privacy, personalization versus privacy, and how they feel vendors are using their information. And you may be surprised with some of the findings.
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Small Business Trends: SAS recently put out an interesting infographic from a study talking about personalization versus privacy. But, before we get into that discussion, can you tell us a little bit about yourself?
Wilson Raj: Sure, my background has purely been in marketing for the past 20 years. Meaning, from a communication side; writing, program management, brand management. I did a lot of global work and several stints in various industries. Not only in just tech, but in the medical side as well.
I also had experience in digital agencies where we did large digital initiatives for clients. But, at the end of the day, my love is really for the art of marketing and how that influences people’s lives on a daily basis. Really, this is a fun fun trip for me.
Small Business Trends: Can you talk about the personalization versus privacy conundrum and why you did the survey?
Wilson Raj: We looked at a lot of surveys currently in play around the idea of big data, analytics. All of those are very interesting. But we thought the one question that was not answered was what do consumers think about this? They’re reading about this in the newspapers on a daily basis. Constant Facebook privacy changes. Google. The recent ‘Snowden Effect’ with the NSA.
Consumers are reading about this on a daily basis. And also reading about how customers are using data to provide better experiences for them. We just wanted to find out what they were thinking about this. We surveyed about 1,200 consumers picked from the banking, retail side as well as mobile operations or mobile services.
Small Business Trends: You also look at folks under 30 verses those folks a little bit older, correct?
Wilson Raj: That’s right. Basically it was 18 and above in the U.S. We did look at segments. Now the over-arching conclusion was that seven out of ten of these folks did have privacy concerns. Given what they were reading and perhaps even experiencing. But, the interesting counterpoint to that was, even with this amount of concern, about six in ten stated that they expect and want companies they do business with to be highly, highly relevant and highly personalized and able to understand them.
When you break it down, the things that came from them include wanting to be treated as individuals. They certainly want those personal offers and messages that come through various channels. They want to be able to be communicated with in the channels that they prefer or choose. Which changes by the way. The other big piece was they wanted a consistent customer experience.
We also saw some interesting nuances as you mentioned in some of the segments. The folks 30 and under, had an even higher expectation. Overall, it was six out of ten, but with the under 30 group it was seven out of ten. Severnty percent are saying, ‘Hey, we expect this.’ We saw similar results, close to seven out of ten, with consumers in the high income bracket about 100K and above.
Small Business Trends: It sounds like the digital native generation that grew up with this stuff. They know what the trade off is, basically, and feel more comfortable. It seems like the folks who make more money feel like they have a little bit of a better understanding of how this works, and they feel a little bit more comfortable with it.
Wilson Raj: Right. I would say certainly the digital natives and probably the higher income digital immigrants working in tech and are familiar with these things.
Small Business Trends: It doesn’t dispel that they don’t have concerns, but they feel like as long as companies are using this data to improve their experiences, then they are okay with that.
Wilson Raj: That’s correct. And that’s where we come to the second finding, which is really interesting. They certainly had high expectations. But when we ask them, particularly in banks, mobile operators, as well as retail, ‘Are you getting that level of personalization and relevance expected?’ It was a resounding positive.
Basically, almost six in ten said they saw improvements in the relevancy and personalization of messages that were coming in. In addition to that, 38%, noticed a reduction in irrelevant communication. So we see that the brand performance is matching the consumer expectations.
Small Business Trends: The consumers are expecting companies to use the data. But, they’re also expecting them to use the data in a way that makes their lives better. What you’re seeing, from the consumers’ perspective, is companies that are doing this seem to be at least doing it effectively to an extent.
Wilson Raj: To a certain extent. From a general perception perspective, the online retailers scored the highest points.
Small Business Trends: Like Amazon?
Wilson Raj: Absolutely, I think everyone has an expectation of Amazon. In terms of how perception, even if they did not do business with Amazon. Which, we find hard to believe these days.
But, the perception is that these guys have got it down to a science. When we asked them, ‘From your own experience, score the companies that you do business with. The banks, the retailers, the mobile service providers.’ The banks came up on top. They scored about 3.8 out of a possible high score of five.
And, the other two, retail as well as mobile service, were down at about 3.5. From an actual experience perspective, bank customers felt that they were easy to do business with in most of the channels. Coming from a branch or a digital service, for example. They felt there were more personalized activities. I think when we think of a bank versus Amazon, there’s a range of things you would do, from checking to banking to savings to investments. Again, that transactional data is being used both in a digital setting as well as an offline setting. That’s why they scored a little bit higher.
But, the interesting thing about this when we did a deeper dive, in terms of what were some of the enablers from a brand or a company perspective, these things really stand out. First one is:
- The notion of consumer insight. Know me. Understand me. Understand my journey and what I’m trying to achieve. That was a big enabler that certainly comes out.
- The other one is to make sure that you link up hindsight with foresight. Hindsight would be more transactional. Purchase history. Any kind of returns. Things that are captured in a CRM setting. Then, the digital body language that’s in social media, posts, Twitter feeds, etc. That gives you a more behavioral analysis, and that gives insight into people’s motivations and aspirations.
Sentiment is a big one. When you link the hindsight with the insight from these things you get what we call ‘foresight.’ Where you’re able to better predict. I think that’s another best practice. The other piece is really fronting the customer-centricity, right? The use of information with really strong data management principals and priorities.
Small Business Trends: There’s a lot that goes into turning that data into great experiences. How does a company get started?
Wilson Raj: You can break it down into three categories:
- The people aspect
- The technology aspect
- The process
The easier ones are typically, in my opinion, process and technology. Start there. Although, it’s better coming from the people aspect which means there’s a cultural mind shift. I think most organizations are starting with the premise that. ‘For me to survive, it’s all about the customers. Not just in marketing, but in every aspect of my operations.’
Small Business Trends: The bottom line is companies do need to leverage the information that is at their disposal about customers. But, make sure they use it for good, not nefarious purposes.
Wilson Raj: Right. And something could be as innocuous as trying to get them to do an up sell and cross sell. Right? And, move to the next service offering. If you know the sentiment of the customers to mentally to go there. Then, it’s really the wrong thing to send them offers. Where, you know they’re not interested in moving. It could be as innocuous as that.
Of course, there are other kinds of bad uses of data. Spamming and selling their data to other parties. What does a customer want? How can I best meet that need? Sometimes, it may not be sending them an email for an offer. It could be education of some sort or giving them another value add. Or, maybe partnering with another vendor. It all boils down to, ‘What value are you providing them in their journey?’
Small Business Trends: Their experience with you is only as good as their last interaction with you.
Wilson Raj: Exactly.
Small Business Trends: Where can people learn more about the survey?
Wilson Raj: We have the survey posted on SAS.com. Under SAS voices there’s a post by the Chief Researcher, Pamela Prentice.
This is part of the One-on-One Interview series with thought leaders. The transcript has been edited for publication. If it’s an audio or video interview, click on the embedded player above, or subscribe via iTunes or via Stitcher.