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Customer data protection principles for customer-centric brands

Posted 27th October 2015 | Category: BrandStrategy

Customer data protection principles for customer-centric brands

It's time for brands to get serious about their obligation to responsibly manage customer data if they want to offer a personalised experience to customers.

Brands are increasingly built on customer data as they use the data they hold on customer interactions to develop innovations and personalise brand experiences. It’s becoming unnervingly personal, in a connected world almost all customer data can be classified as personal data, anonymity is increasingly illusive.

At what point does it become creepy when computers and the environment around us can recognise who we are and our behaviour?

The Microsoft Windows 10 upgrade and the new Spotify Terms and Conditions are both recent examples where access to a wide range of user personal data, including our location and contacts, is used to optimise the user experience. Every new Apple iOS and Android OS update seems to reach deeper into our personal data so that connected devices can personalise our experience and support our lifestyles in innovative ways. Smart homes and connected cars promise to extend this further into our lives. More chilling than this, the growing list of data hacking scandals undermines consumer trust of brands that are admired and used every day. And a scare for businesses, the Safe Habour Agreement has now been overturned, meaning that US brands with customers in Europe have to find new ways to demonstrate that they adhere to the data protection laws of the EU. There is a blurring of the distinctions between marketing and surveillance as data security and privacy of customers come under attack.

So can brands change direction and innovate in ways that protect and support their customers? How can effective management of customer data differentiate brands and build trust?

The following principles would be a good start for customer centric brands to action:

  1. Shore up data security policies – cyber security is a major concern in a hyper-connected world, put customer data at the centre of risk management, brand reputations depend on it.

  2. Be accountable to customers - Prepare contingency plans in case of customer data leaks. Proactive policies will help brands to reduce risks if things go wrong and spiral out of control.

  3. Transparency about data collection and use – communicate clearly about how data is being collected and used. Provide intuitive ways for customers to make choices about consent and disclosure, allow them to delete, correct, collect and use their own data.

  4. Drop contracts of adhesion – move away from one-sided “take it or leave it” contracts that offer no choices. Customers want a range of options based on how they use the brand.

  5. Write privacy policies in plain language – rethink the way customers sign-up and opt-in, develop easy to read privacy policies that support properly informed choices

  6. Ensure privacy by design – Brands that assure customer privacy as the default setting are more likely to win their hearts, minds and wallets. Privacy-by-design offers a structured approach to achieve this.

  7. Develop a compelling value exchange – address customer data in the core business model in ways that add value, rewarding customers for sharing personal data.

  8. Make customer data portable – develop secure ways for customers to use and manage their personal data on their own terms, provide analytical tools to increase engagement.

Brands need to re-establish trust before they bring new innovations to market that rely on greater use of customer data, including personalisation. Better internal policies, a greater understanding of customer expectations, better communication and transparency about data usage can help to accomplish this.

At the heart of this, customer data policies that mistake access for permission are likely to face increased scrutiny and undermine trust. Brands that inform their customers and adapt to their needs will reap rewards.

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