By | Jan 14, 2022
CHANNEL: Digital Marketing
At the intersection of the 3 P’s (with apologies to Philip Kotler) — privacy, preference and personalization — lies a huge new opportunity for competitive advantage that marketers are only just waking up to. And it’s one made possible by increasingly robust consent and preference management technology that lets brands take personalization to the next level.
Privacy and personalization have often been considered as at odds. But the arrival of consent and preference management solutions gives marketers the opportunity to shift to a privacy and customer first approach.
Consent management is the process of asking people’s permission to collect, process and store their data in order to execute marketing activities. When customers opt-in or subscribe to something the brand offers — be it to receive notifications, newsletters or offers — they are giving consent.
Preference management is when customers willingly give marketers information about their preferences, to receive better, more personalized communication and experiences. This is several notches above consent-led opt-ins, as it gives the marketer the ability to communicate at the time, frequency, channels and topics the customer prefers. This is not the inferred preference marketers have been working with so far, but the customer’s actual stated preference. Such data, offered voluntarily by the customer, is also called zero-party data. Needless to say, it is the strongest kind of first-party data a brand can hope for.
Related Article: The Demise of the Cookie and the Rise of First-Party Data
While consent management has been in the limelight ever since GDPR came into effect, it’s been siloed into the compliance bucket rather than seen as a marketing must-have. Customer preferences, when incorporated at all, have typically been standalone marketing initiatives.
Consent coupled with preference, however, reveals a whole new set of possibilities for CX-focused marketers.
The business case for building out a seamless consent and preference management system seems strong. While consent management is a matter of compliance, preference management can be a matter of profitability. Together, they add a new dimension to the customer experience.
When consent and preference management, marketers can hope to see one or multiple of the following outcomes:
Related Article: Will There Still Be Marketing After GDPR?
So, who will bell the consent and preference management cat? Quimby Melton, co-founder and CEO of Confection.io, a privacy-first data solutions provider, adds that while compliance is a must have, it’s also a cost center. This is why marketing, which by now has a reasonably proven track record of turning data into profits, “stands the best chance of turning a compliance painkiller into a value-adding vitamin. That is, marketing, which is also in charge of the CX, is in the best position to start making something meaningful with the output.”
Susan Raab, managing partner of the CDP Institute and editor of the weekly Privacy to Market newsletter, also feels that the days of legal and IT owning customer privacy policies are over. Due to increasingly complex new regulations and because customer loyalty is at stake, “companies — and particularly marketing — must address this with a privacy-by-design approach, or they will constantly be playing catch up and open themselves to risk.”
CMOs planning to take the lead in the strategic investment should look at privacy as it relates to the whole organization, and aim to get stakeholder buy-in and input from the start, said Raab. This means external stakeholders as well, the foremost of which is the customer herself. So far, enterprises have been trying to protect their “control over the process” and customers are trying to protect their data as a matter of principle. Melton calls this constant friction between customer and company a “naive war,” and said it’s time to approach it as a win-win situation. This is exactly where and why CMOs should step in and make the business case for giving people greater user control over their data while giving marketers better decision-making insights.
“This approach will cut down on data storage costs, CMS usage costs, and the time teams spend chasing uninterested prospects. By giving everyday web users more control over their data, we’ll build a more relevant, more concentrated set of opportunities and better relationships with our customers,” he added.
Related Article: COVID-19 Changed Your B2B Customers for Good
Adding a consent and preference management system on top of existing complex marketing processes can be a challenge, despite being closely linked to marketing and CX goals. Raab highlighted several connecting parts for marketing to consider as they match their needs to system capabilities. These include workflows for sign-ups and onboarding; website messaging; ongoing engagements like subscriptions; data sharing and internal and external access; opt-outs; lapsed customers; and whether users are being provided with enough options and opportunities to choose and change their preferences at any stage of the interaction.
For smoother deployments, either the existing marketing operations need to be perfectly well-oiled before the privacy system (encompassing consent and preference) can be bolted on, or if it’s being built from the ground up, consent and preference should be part of the strategy and the stack from the start. However, as we move deeper into a privacy-first reality, cautioned Melton, recording consent can be just as challenging as recording any other browser-level event (pageview, click, etc.). “Marketers should think about how effective their consent-management solution would be in an increasingly stringent privacy-first situation. Consider solutions that are able to collect, store, and distribute data in a way that’s unaffected by client-side disruptions involving cookies, cross-domain scripts, and device IDs.”
The vendor also needs a track record of keeping pace with regulations, the ability to educate clients on how changes can impact their business, and the ability to scale and respond to future demands. For example, in an omnichannel world, systems also need to work and connect across multiple channels and devices, including the web, mobile, CTV, and perhaps even IoT and smart wearables.
Finally, industry context — geography-specific regulations, budgets and business priorities, current levels of integrations, customer data maturity — all play a part in the decision.
Related Article: Why Marketers Should Be Leaders With Customer Data Privacy
Ultimately, said Melton, CX is caught between three enormously powerful pressure points:
With the confluence of consent and preference management, and the maturity of the technology to enable and integrate these systems, marketers can finally get ahead of the tension between privacy and personalization. In fact, they can turn it into an opportunity to build better customer relationships and drive competitive advantage. Those who are able to effect a mindset shift to view data privacy from the CX lens will take pole position in that effort.
Tags chitra iyer, consent and preference management, customer data, customer experience, cxm, digital marketing, personalization, privacy
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