In November 2018, Marriott International announced an incident where unauthorized access to a Starwood guest reservation database potentially compromised personally identifiable information (PII) of upward of 500 million guests. Marriott later revised the number to 400 million unique guests, with the stolen information including roughly 25 million encrypted and unencrypted passport numbers and 9 million encrypted payment cards.
It was the largest known security breach since the General Data Protection Regulation (GDPR) took effect six months earlier. The European Union data protection law – which gives consumers more control over how their data is shared and used – as well as a series of breaches of consumer trust thrust PII into the national discourse. The Starwood incident further underscores the risk and responsibilities companies assume when customers provide PII.
Customers understand that they are entrusting valuable information to the companies they interact with, and they expect two things in return. One, that the information is safely guarded. And two, that they receive something of value in exchange. Often, value is defined as a more personalized customer experience than one would otherwise receive without providing PII.
The Value of Personal Data (PII)
In the run-up to GDPR taking effect, Accenture conducted a survey that shed light on the value of PII from the consumer standpoint. Roughly 90 percent of respondents said that they planned to limit access to PII and prevent retailers from selling their information to third parties, a strong indication that consumers are aware of the value of their data. Yet about two-thirds of consumers said that they are willing to share PII in exchange for a perceived value, and one-fourth said they are willing to share PII for better service or the ability to choose which data is shared with third parties.
Perceived value can take many forms. From the consumer’s perspective, it could mean being able to log into an online bank account with one less click, a retailer sending cross-channel discount notifications on an item you’ve been researching, or customized product recommendations.
For many this perceived value is defined by the level of personalization. In the Sitel 2018 CX Index report, more than 60 percent of respondents said that receiving personalized communications over email, chat, and social media is important. Asked which industry they’re most likely to share personal data for a better customer experience, banking and financial services rated highest (34 percent), with travel and hospitality second (18 percent) and retail fourth (15 percent) – just below “I don’t know.”
A Matter of Trust
The Financial Brand ranked the demand for value in exchange for data as the fourth biggest digital consumer trends for financial marketers in 2019, and identified trust as an important part of the exchange. The report said that this will be the start of a period where “consumers will only unveil their interests and personal information in exchange for value.”
Consumers place so much value on a frictionless, personalized experience that they seem willing to forgive companies for an unwitting breach. Once trust is broken by a brand, recovery is often dependent on two factors – quickly repairing the trust and providing value that consumers will say is worth the risk of exposed personal information. In the Accenture survey cited above, four of 10 consumers said that their trust in a brand or company goes up when a breach is handled swiftly and correctly. And eight in 10 said that trust is a key driver of brand loyalty. This tells us that consumers will give the brands they like the benefit of the doubt when it comes to protecting PII if it’s used to enhance the customer experience.
Fragmentation, Friction, and Frustration
What customers ultimately mean when they talk about personalization is a desire to be recognized across an omnichannel journey. A customer who makes an in-store visit may expect a retailer to know about online research that preceded the visit. Or if a customer places a phone call order for a provisioned smartphone, there is often an expectation to pick up the phone at a local carrier the next day. These omnichannel experiences are not possible without the information exchange.
Customers understand that enabling that seamless experience across all interaction touchpoints requires the sharing of personal data, and they will make the exchange because doing so reduces friction in the customer experience.
Fragmented systems and siloed customer data impede the ability to provide the frictionless customer experience that consumers expect. Consumers faced with friction are less likely to entrust a brand, retailer, or banking institution with PII. Conversely, companies that eliminate fragmentation will be better positioned to deliver the value that their customers expect, and in return will have a greater chance of being entrusted with PII.
A Single Source of Customer Truth
Eliminating fragmentation with a unified customer profile and single point of control over customer data reduces friction by allowing a company to move at the cadence of the customer in an omnichannel journey. Whether in banking, retail, hospitality, or another industry, customers no longer move in a static, linear path. A company armed with a golden record – a continuously updated and unified customer profile – can recognize a customer’s buying patterns and preferences, and can proactively engage with the customer with a relevant experience across any channel.
Brands that can provide this level of personalization are raising the stakes for what consumers will demand in exchange for PII. With GDPR and other data privacy regulations taking hold, the consumer is more aware than ever that personal data is the new currency, and they are more aware that they are empowered to share and use data as they see fit. Consumers are telling us what the cost is for their business. Is your company listening?