Build trust, get data, go to market. That is what many brands have as their data strategy – leveraging brand reputation and relationships to capture information on customers. With customer retention the number one marketing objective, it makes a lot of sense. As far as it goes, that is.
While you will find a good awareness of data protection as an issue across the marketing industry, this has yet to convert into the right operational culture. To be truly data-literate, a company has to understand that customer data is an asset, and one that comes with associated risks.
Data security is the obvious one. Tales of lost laptops and hacked web servers abound and increasingly, consumers fear that protection of their data is not being treated seriously. Here’s the terrible truth – in most cases, it isn’t.
Take the latest warning by the Information Commissioner’s Office about estate agents (see page 40). According to the ICO, only a small proportion have notified the regulator that they are handling personal data. You can’t move house without giving an agent your personal information. Most buyers register with multiple agencies. So their exposure to data loss or theft is multiplied.
If companies do not even get the first step right, by registering with the ICO, what chance is there that they have appropriate management processes in place? And that is a step which is free of charge. Get into the more complex issues of training staff, implementing data security technology or having a risk management programme, and the majority of companies will be left behind.
Increasingly, consumers fear that protection of their data is not being treated seriously. Here’s the terrible truth – in most cases, it isn’t”
Nor are estate agents necessarily small businesses which often struggle to keep up with regulatory demands. Many are national chains and those not registered could even be owned by blue-chip financial services providers. Those parent brands probably do have a data-literate culture, but they may be unaware of what their children are doing that is putting the brand at risk.
Consumers are growing aware of the value their information has to commerce. Some argue this will convert into a consumer-led trade of data for service. For individuals with the right knowledge and skills, combined with an income level that makes them attractive to marketers, this could yet happen.
For the rest of the population, it will be down to their trust that a brand does the right thing. Like manufacturing products that do not have bad side-effects, managing data to minimise risk to both sides is critical. The next step in data strategy has to be the introduction of data governance.