Half of marketers risking distrust with lax data policy

Many marketers are not paying attention to data protection rules, such as offering consumers a clear opt-out from being contacted, and are suffering from low customer engagement and a lack of data, yet tactics such as loyalty schemes are fruitful in gaining consent.

Almost half of marketers believe their organisations are failing to follow best practice for data capture, with only 56% agreeing that they give consumers a clear and easy opt-out of marketing communications when collecting their information.

The findings are revealed in The Customer Acquisition Barometer, a new report by the Direct Marketing Association (DMA) in partnership with The Media Octopus. The study includes a survey of more than 1,000 consumers and 164 marketers.

Although opt-outs are clearly communicated only by a small majority of marketers, even fewer – just 43% – claim to avoid small print or jargon. Meanwhile, 62% of marketers believe that they clearly explain to consumers how their data will be used. When asked to name their biggest challenges from a customer acquisition perspective, 40% cite limited budget, followed by 28% citing limited internal resource. Data degradation (20%), lack of consumer engagement (17%) and lack of data (15%) also score highly.

Perhaps as a result of these challenges, many marketers are failing to adhere to formalised industry standards. For example, two-thirds of marketers (65%) state they are following the DMA Code of Practice, but only 55% say that they follow guidelines set by the official regulator, the Information Commissioner’s Office. In addition, only 34% of marketers have their data usage processes checked by an internal compliance department, while 12% never conduct audits on their customer acquisition processes.

Thomas Ridley-Siegert, research manager at the DMA, believes better education of marketers is needed to improve standards within the industry. This in turn will help to enhance consumers’ level of trust in how brands use their data. Knowledge of best practice in the area of consent is becoming increasingly important, with the EU in the process of drafting a new wide-ranging data protection regulation.

“The take-home message from this [research] is that there’s room for improvement,” he declares. “Marketers acknowledge that obtaining data is going to get harder as regulations change and as public attitudes change too. But it’s also important that they follow the guidelines and best practice that are in place.”

Yet despite some marketers’ lack of attention to data compliance, not all consumers are averse to handing over their details to brands. The research shows that 46% of consumers are willing to share data via a loyalty scheme if they have previously purchased an item from the brand. However, the figure drops to 21% when it relates to the loyalty scheme of an unfamiliar brand.

Competitions are the second most popular incentive for data sharing (33% for those familiar with the brand, 23% for those unfamiliar) and coupons are the third most popular (31% and 20% respectively).

The study also reveals that email is consumers’ preferred contact channel, with 74% stating they want to receive email from brands they know, dropping to 60% for unknown brands. Meanwhile, 40% of people would prefer unknown brands to use direct mail, but only 28% want brands that they know to send them mail.

These established direct marketing channels remain significantly more popular than newer digital platforms. For example, only 13% of people say they wish to have contact with a known  brand via social media, dropping to 8% for unknown brands, while 12% want to have contact with a known brand through an app, dropping to 4% for unknown brands.

“People still really value getting emails from brands,” notes Ridley-Siegert. “Consumers have a lot of control over their inbox and it’s a passive receipt – it’s not like a call or a text because you can choose to either look at your emails or ignore them. The research shows that people still like having that choice.”

Email is also the most trusted channel for data sharing, with 58% of respondents stating they have confidence in the level of data security in email, up from 43% last year. A brand’s own website scores 54% for confidence in security, up from 42% in 2014.

Confidence in data sharing via mobile websites and apps is also up significantly from 4% last year to 17%, while confidence in sharing data on social networks has surged from 5% to 13%. The report suggests that “a likely driver of this confidence is the depth of experience and maturity of usage of mobile devices, combined with more visible efforts by brands to demonstrate how secure their sites and channels really are”.

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