During a keynote speech at a digital marketing event recently, Tim McLoughlin, Head of Social at Saatchi & Saatchi, expressed what many marketers feel: when it comes to utilising consumer data, there is a conflict between how you feel as an advertiser and how you feel as a consumer. If even those in the business feel uncomfortable about use of their personal data as consumers, surely something is amiss. Are some data-driven advertisers crossing the line with their use of consumer data?
The case for sharing data
90% of the data currently in the world was created in the last two years. Marketers have only recently begun to unlock the vast potential of this data for targeting consumers. Before the data revolution, traditional media planning ruled the roost; the approach used the best audience figures available, but the only way to truly reach a wide audience base was to opt for huge spend across a wide range of media. Nowadays, there is an endless stream of data available that allows advertisers to compile statistics and approximations on how many adverts the average consumer is exposed to in a day – yet the bottom line is that consumers are still bombarded with adverts, the vast majority of them irrelevant. The rapid emergence of adtech solutions over the past 12 months has shown that intelligent use of data can change this.
As consumers, most of what we do online (and, to a certain extent, offline) leaves a data trail. How many times a day do we check our Facebook account? Which ecommerce sites do we visit most often? What do we watch on Netflix? As businesses begin to build an ever-more-detailed picture of us using the data that we generate, advertising becomes more and more like a conversation between the consumer and the brand. Say two people – Person A and Person B – visit the same website. In the old world, website advertising was sold in much the same way as ads in magazines: one banner or panel that would be served to every visitor. Now, thanks to retargeting technology, adverts that are appropriate to the viewer can be instantly delivered. This means that Person A might see that the dress they looked at last week is now on sale, while Person B will see that the new series of their favourite TV show is coming out in a few weeks. This is surely better than both Person A and Person B seeing a generic ad for something that interests neither of them.
Data-driven marketing gives brands the opportunity to personalise the consumer experience and open a dialogue with the public, rather than racking up huge spend in the vague hope that at least a few people who see their TV spots, print ads and billboards will engage. From a marketer’s perspective, audience data provides vastly improved accuracy and cost-efficiency. They are able to ask far more of their planner-buyers, who’s performance can now be scrutinised like never before. From a consumer’s perspective, while targeted ads can feel intrusive, there is no doubt that these new methods get rid of some of the clutter and can actually be far more likely to be of interest.
The case against sharing data
Back in 2012, a report by the Direct Marketing Association segmented consumers into three categories:
- 1. Privacy pragmatists: willing to exchange personal data for enhanced service, on a case-by-case basis;
- 2. Privacy fundamentalists: unwilling to provide personal data, even in return for enhanced service; and
- 3. Privacy unconcerned: those who are unconcerned about the collection and use of their personal data.
Even though the report is a couple years old, its results concerning consumer attitudes to privacy are still very relevant. Over 50% of the population were identified in the report as being “privacy pragmatists”, while 31% were identified as being “fundamentalists”. Therefore just 19% of respondents were “unconcerned about the collection and use of their personal data”. The report concluded that, to influence the fundamentalist segment, businesses have a responsibility to both empower consumers take control of their own data, and to ensure that the provision of personal data is rewarded with enhanced services.
Consumers are likely to feel uncomfortable about brands using their personal data without restraint. Retargeting technology, for example, has been used quite aggressively in some cases. Potential consumers are often reminded to purchase something they previous viewed while shopping online multiple times in a week, across multiple devices. In some cases, this retargeting continues even when that consumer has already purchased the product in question. As marketers are still getting to grips with how best to use adtech for their campaigns, instances such as the above example can actually irritate consumers, making them very conscious that their online activity is being closely followed. Advertisers who use retargeting without any limitation therefore run the risk of alienating consumers rather than enhancing their experience.
New adtech technologies, such as negative retargeting and the ability to differentiate between existing and potential customers, are starting to permeate the market. These will allow brands to avoid negative consumer experiences and instead use audience data to provide useful, personalised information to their community. The more positive experiences consumers have as a result of businesses utilising their data effectively and tactfully, the better – for the brand and for the consumer.
What’s the solution?
Many marketers are currently worried about being too invasive – or rather about appearing too invasive – when it comes to data-driven marketing. Arguably, the more invasive the data, the more relevant the advertising is likely to be – and this is actually a good thing. For example, combining location based data with browsing history, a brand could remind a consumer that they wanted to buy a certain product, and could then use location data to notify that person that they are actually just 50 yards from a store that has that product in stock. Sometimes this information is so useful to the consumer that they barely give privacy a second thought – thinking only of the enhanced service they have received from the brand. Of course, this won’t always be the case; all consumers are different. But, in general, the more relevant the marketing activity is to the consumer, the more value that consumer receiving in return for giving up their data.
It’s important to remember that the responsibility does not fall entirely on the brand. Consumers need to understand that they are the gatekeepers of their personal data (to an extent). When downloading a new app, for example, it’s easy to simply ‘Login with Facebook’ and thereby avoid the rigmarole of setting up a new account. Users – who rarely read the terms and conditions – shouldn’t then complain when they see related adverts on their Facebook news feed. Consumers need to understand that certain benefits do flow from sharing their personal data with advertisers – special offers, relevant advertising – and marketers need to make sure that they find the right balance between effective targeting and invasive practices.