Customer privacy is a vital aspect of business strategy, and organizations can help build trust and loyalty by exercising transparency. Businesses should rethink their data policies and compliance practices to find the right balance between consumer privacy and data-driven personalization.
Customers today expect high levels of engagement and tailored experiences from the companies with which they do business. If a company wants to provide exceptional customer service, it must collect consumer data and establish a customer experience plan that is tailored to their target market.
While it may appear simple, it isn’t always easy in a world where data privacy is a major priority for both consumers and organizations. Cybercrime targeting businesses has become increasingly widespread as companies store an ever-increasing amount of customer data on their networks.
Whether a company is attacked by cybercriminals or violates data privacy rules, they must be concerned about more than simply the financial consequences. The brand’s overall customer experience is also heavily influenced by data privacy.
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What can organizations do to solve the privacy conundrum?
The current conundrum appears to be vicious, as organizations must both avoid compliance violations and hefty fines, as well as obtain and effectively use customer data. Only by striking the right balance between personalization and privacy can businesses chart their course to success.
Collect only the necessary data
Businesses should only gather the information that is necessary to provide value to their consumers, Customers will be willing to divulge more information if they receive more value in exchange for their data. Brands should collect data not only to prove that they know their customers, but also to give ‘in-the-moment’ experiences and services.
Transparency in data gathering and usage
Companies should provide explicit disclosures of how and what kind of personal data they collect on their mobile apps, websites, and other business tools. Businesses should provide use cases and demonstrate how, once they have more information about their customer, they can make personalized offers.
Companies must allow customers to choose what data they want to share with them, who else has access to it, and how long it will be kept in the database. They should also introduce simple methods for requesting customer intervention while gathering data.
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Implement solid data governance policies
Most companies, beginning with the C-suite, treat data governance as if it were a set of policies. Due to a lack of quality-assured data governance, many organizations squander a considerable amount of their company time on low-value tasks. Aside from generating value, good data governance protects businesses from costly compliance and regulatory risks.
A targeted data strategy should be driven by governance stewards appointed from all departments, at all levels of the organizational structure, for effective data governance. These stewards should establish data governance principles and encourage employees to become data security champions. It’s also critical to align the data governance approach with the business goals and overall strategy. The right level of data governance enables businesses to distinguish between high-risk data – such as Personally Identifiable Information (PII), that should be kept secure and low-risk enterprise data that can be shared with employees.
When businesses try to take advantage of digital, analytics, and other transformative opportunities that can improve their customer experience, data governance is crucial. It’s past time for businesses to start including data governance as a critical component of their overall strategy.
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