Marketers’ most common fear about GDPR is their decreased ability to target consumers. GDPR raises the bar for acquiring permission for everything from targeted display advertising to personalized email messaging to location targeted mobile ads. While data protection is good, decreasing relevance for consumers is bad, and it’s something marketers must work diligently to avoid.
Why? Research shows that consumers are pretty happy with the idea that sharing data gives them better experiences from companies (including these in the UK.) But other research shows that asking consumers to opt-in to data targeting can be tricky. Estimates range from 30 percent to only 5 percent response rates depending on the kind of company asking for data, what data they are asking for, and how well they actually ask for it.
Data Is Currency – Act Like It
What used to be an unspoken agreement between companies and customers has become a very real currency. With GDPR and ePrivacy taking up a lot of headspace for many marketers this year, it’s worth remembering that consumers are relatively sympathetic to the cause, as long as the value of their data is part of the transaction.
Authors Eric Posner and E. Geln Weyl recently argued that it’s time that consumers actually got paid for their data. In fact, there are now a number of companies pursuing the business model of acting as a data broker between consumers and brands, including repay.me and Unlockd.
It’s no longer enough that marketers offer run-of-the-mill 10-dollar newsletter sign-up discounts. If data is a currency, brands need a more nuanced and personalized way of being transactional about consumer data, evaluating the value of every individual data exchange and giving consumers more say in the relationship. Last year, Telefonica Germany partnered with startup People.IO to give consumers more control over their data within the Telefonica app.
Put the Data Value Exchange Front and Center
In Selligent’s own recent survey of 7,000 consumers around the world, we found that consumers really want companies to understand them, and they are mostly aware that providing data will help companies to do that. Nearly half of the consumers in our study think companies should use their personal data to provide better service and 70 percent agreed that it was important for companies to understand their current situation before sending them a marketing message.
That’s a high bar. Marketing to current situations means that a teenager who just broke up with his girlfriend expects a Spotify recommendation to focus on sad songs, someone who just left the dentist probably doesn’t want ads for candy, and a women who just got a new puppy isn’t about to buy a white sofa.
Try to collect that data without having a very frank interaction with those consumers. You can’t.
Very few consumers told us that they would punish a company for safe data collection and use as long as they got value from it. This gives marketers a window to be direct with consumers about collecting data, just in time to build up first party data assets that comply with GDPR.
Some companies, like ThredUP or Blue Apron build in data requests to help hone search results and product recommendations on their platforms. For example, asking if you need clothing for work or fun, or if you’re vegetarian or just like a lot of veggies. These digitally-native brands build data requests into their platform. For marketing purposes, post GDPR, the exchange needs to be a bit more overt. Brands must request to use that data in the future.
Brands will get a much better response if they engage the consumer in the decision and show an example of why the data is valuable. Rather than a check box to “send me personalized offers,” asking the consumer to decide between “No, I’d like to get generic emails that don’t consider my size or style preferences” and “Yes, I’d like clothing recommendations in sizes and styles based on my preferences,” will increase their willingness to hand over their data.
AI and Machine Learning Take Hold
To manage the stringent data collection and management requirements under GDPR, many companies are improving their data organization’s technology and oversight. This provides a good opportunity to build innovative data collection ideas into everyday practice, which in turn increases the strength of the data value exchange over time.
For example, marketers can build in the ability to provide unique survey questions to individuals such as “it seems like your favorite color is pink, would you prefer we send you pink product ideas for the next few emails?” This seemingly small capability actually sets up the ability to provide massive and flexible GDPR compliant personalization at scale.
GDPR will force marketers to rethink data collection but it is not the end of personalization and targeting. For marketers to reach consumers, the data value exchange helps to focus post-GDPR efforts as companies rebuild their data assets into something better than they had before.