Going Beyond Compliance to Infuse Loyalty into Customer Relationships

John Nash | March 12, 2019

Compliance with new data privacy regulations is a top priority for companies worldwide. The California Consumer Privacy Act (CCPA) and General Data Protection Regulation (GDPR), combined with several high-profile data breaches and hefty fines levied against companies for violations have thrust data privacy into the limelight, giving marketers the daunting task of helping to ensure compliance without sacrificing program effectiveness. Marketers are being asked to personalize customer engagements on one hand, while adhering to tightening data privacy regulations on the other.

It is a mistake, however, for marketers to think that their hands are tied, and that compliance and innovation are mutually exclusive. A smarter mindset is for marketing to view an onslaught of data regulations as an opportunity to deepen a continually evolving relationship with a customer. Taking this approach shows you’re complying not just because you must, but because doing so optimizes the customer journey in line with a customer’s communications preferences.

Instead of compliance for compliance’s sake, viewing data privacy through a transactional lens as a current event, a more effective approach looks beyond compliance to view data privacy through the prism of enhancing customer lifetime value (CLV). The more a brand knows about a customer – to include intent, behaviors, and transactions – the more it can minimize customer friction and maximize share of wallet.

A Carefully Managed Customer Experience

Data privacy regulations give customers more control over how their data is collected and used, establishing guardrails for marketers in terms of managing ongoing permissions, preferences, response requests, and other controls guiding the use of personal data. By tying privacy preferences to CLV, a brand can proactively shape future marketing outreach strategy and escape the trap of constantly pushing boundaries and putting the onus on the customer to limit interactions.

When customer data preferences become part of a single customer view, a marketer can score a customer’s preferences based on behavior over multiple events and devices, and thus carefully manage the customer’s experience in accordance with their data privacy preferences. The next time the customer conducts a search, opens an account, or breaks a geo-fence, a marketer will know which response, notification, or outreach – if any – has the highest likelihood to produce a desired result.

From a practical standpoint, understanding permissions as an aggregate over time rather than on a transactional basis gives a marketer back some of the control that data privacy regulations put in the hands of the consumer. Say a customer tends to opt-in whenever they initiate an engagement, such as visiting a website or contacting a call center. The same customer also opts out whenever they’re targeted for an outbound marketing program. By tracking this behavior over time and across multiple devices and channels, a marketer can expertly manage the entire customer experience. Even with permission to send an email, for example, a better strategy might be to wait to bring the customer to an outbound program until such time as you build trust and loyalty by having shown deference and respect to preferences. In this scenario, the customer isn’t even presented with an option for an opt-out because marketing has unobtrusively managed the end-to-end experience.

Data Privacy, Less is More

Adopting a customer-centric approach to data privacy management governs contact frequency and intensity beyond simple adherence to a customer’s preferences. The ultimate goal for marketing is to be in the position to offer a next-best action recommendation for a customer at any point of a multi-channel, multi-event customer journey. This capability stems from applying advanced analytics to a single customer view to yield a single point of control over all data, decisions, and interactions. Incorporating data privacy preferences into a unified profile adds another layer of intelligence to the next-best action recommendation. Managing contact frequency as part of a next-best action provides a level of communication sophistication that can differentiate a brand.

Marketers always strive for the precise moment of engagement – a “sweet spot” – that will most resonate with a customer, but the default modus operandi has been to test the boundaries, continually probing the lines to discover the exact point that creates friction for a customer and stopping there. Data privacy regulations force marketers to regroup with a new approach. Smart marketers realize that a holistic view of data preferences across channels and devices enables a “less is more” strategy that can all but eliminate customer frustration by recognizing each customer’s uniquely granular requirements. A brand that understands and responds to a customer’s preferences at an individual level becomes a far more relevant and desirable communications partner with a customer versus a brand with a transactional approach that is seemingly interested only in checking off the compliance box.

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John Nash
John Nash

John Nash has spent his career helping businesses grow revenue through the application of advanced technologies, analytics, and business model innovations. As Chief Marketing and Strategy Officer at RedPoint Global, John is responsible for developing new markets, launching new solutions, building brand awareness, generating pipeline growth, and advancing thought leadership. Connect with John on LinkedIn.