Marketers are constantly hungry for more information: customer purchasing, demographic information, interests and more. However, this data has a chilling dark side that can get your business in trouble pronto if you’re not careful. There are a growing number of laws around the storing and usage of personally identifiable data, and the problem exists far outside of the expected healthcare and finance realms. Nearly 90% of consumers are concerned with privacy around their personal data, so how can marketers balance their desperate need for data with healthy and sane data storage and usage policies? (Note: We have a lot of fun on this blog, but this is a serious topic affecting our customers — so pardon the lack of humor!)
Rise of Mass Personalization
Mass customization was all the rage in the 1990s, but today’s marketers are looking to create a laser target on individual consumers with personalization. The tools used to create this individualized experience require a massive amount of data around consumer habits that can lead to more effective communication overall. While most consumers are okay with allowing marketers to access basic personal information — that is only if it leads to offers and communication that are more relevant. This can go as far as getting a text message when they’re in a store with a coupon, something which 64 percent of consumers were willing to entertain. However, that level of knowledge around an individual’s habits can seem chilling to others which adds to the tension that marketers continue to feel.
Practicing Safe Data Standards
If you haven’ t heard of a recent big data breach tied to a household brand, then you’re not listening closely enough as nearly 143 Americans have been affected by data breaches of some type according to Equifax. Depending on the type of data that you gather and store, you may need to beef up your security procedures. This is especially important for mid-size businesses, who may or may not have a full-time IT security professional reviewing data and privacy issues. Enterprises, while potentially more vulnerable to a breach due to sheer size of the target, have entire teams dedicated to understanding data security. There are levels of vulnerability when it comes to data:
- Data access: Your business has access to personal data of your customers
- Data breach: Your organization has suffered a data breach
- Spillover: One of your competitors had a data breach
- Data manifest: Customer data has been breached and misused
Each of these levels of vulnerability have a different, and increasingly negative, effect on your organization. With all the bad news about data dangers, how can marketers (safely) continue to expand their database and knowledge of customers?
Privacy Regulations Increase
In Europe, privacy regulations are about to become much more onerous to marketers and protective of consumers in a big way with the striking of the ages-old Safe Harbor Act. Companies are no longer allowed to transfer data back and forth between U.S. and U.K. servers willy-nilly unless certain strict certifications are met. Companies who fail to comply could face fines as high as 4 percent of annual revenue, making it a serious concern for multi-national corporations. With EU deadlines looming, here’s some tips for enforcing data privacy within your organization:
- Real-time notification and enforcement: You’ll see more pop-ups and notifications as you visit a site for the first time, letting consumers know that data tracking is in effect and offering the opportunity to opt out.
- Restricted reuse of data: Marketers must be cognizant of everywhere their data is being used, which can mean limitations of reuse and sale of consumer data.
- Stricter data security: It’s critical that marketers work with security professionals to define the right policies for their particular organization.
- Workflow management: Understanding which particular pieces of information are available to which users within the organization allows you to tightly control access to personally identifiable information such as social security numbers, health and wellness information and financial data.