Jackie Long

Balancing customer privacy with a personalized experience

Companies, consumers, and governments have spent years debating the risks and benefits of using data for personalized experiences. Understanding how to properly balance your customer’s privacy with a great experience can help increase trust in your brand. Check out our tips for protecting privacy while creating a convenient, personalized experience.

There is so much consumer data available today that businesses can create customer profiles with pinpoint accuracy. But how much of that data should they be storing and using? Unfortunately, there’s no perfect answer. A debate surrounding the ethics and security concerns of collecting and using customer data has been happening for quite a while.

In recent years, studies have shown that many customers are willing to give up some of their privacy to get better, more personalized shopping experiences. At the same time, governments have been creating more rules around the collection, storage, and protection of consumer data. That means finding a way to balance the two goals is more important than ever.

Changing regulations mean more oversight

Beyond the consequences of losing brand trust and declining sales, data breaches or improper security can result in heavy fines for companies. With regulations like GDPR and CCPA in effect (and potentially more to come), every online business needs to ensure that they are putting the right defenses in place to protect the personal data privacy of their website visitors. Let’s take a closer look at the two most prominent laws in place right now.

GDPR CCPA Infographic

Complying with these laws and regulations will help you avoid unnecessary fees and can help build trust with your customers. When developing your data protection and privacy policies, however, you’ll also need to consider what your customers want to create both a safe and optimized experience.

Customer expectations are constantly changing

Even as their security concerns grow, consumers are still willing to trade some private data in exchange for more convenient shopping experiences. One Verizon study found that:

  • 45% of people between the ages of 18 and 24 were willing to share data for a more intuitive and personalized user experience.
  • 67% of respondents named discounts and promotions as two of the top three benefits they would expect in exchange for their data.

Younger customers seem particularly willing to give up more data for convenience, but companies will have to find the right balance that makes all customers happy. You’ll want to find out how your current and potential customers feel about offering up their data. Consider what data customers tend to be comfortable offering, such as location or prior purchases, and build off that. Changing your policies to use less sensitive data can show your customers that you are trustworthy. From there, you can begin making bigger changes with more specific data.

Establishing the best customer experience

Here are a few tips about where to focus your attention so you can give your customers the best shopping experience possible while still protecting customer privacy:

  1. Be transparent about what data you collect and use. Secure it properly to make your customers more comfortable offering it up.
  2. Begin with changes that appeal to most of your customers. Things like personalized recommendations can make online shopping a lot easier and are already common enough that your shoppers won’t be alarmed.
  3. Purge data you don’t use and protect any data you store about your customers. Breaches of any size can cause customers to lose trust in your company, even if no important information was compromised.
  4. Offer your customers options for sharing data. The more control you give them, the more likely they are to work with you. While some customers will opt out entirely, many will take advantage of the more personalized experience to make their lives easier.
  5. Focus on the end goal. Every change you make and all the data that you store should serve the purpose of getting more conversions. Keeping this goal in mind will ensure that any updates are necessary, impactful, and cost-effective.

Maintaining balance as the debate continues

Regulations and attitudes regarding data will likely continue to change over time, and it’s essential that your company is prepared to adapt its data privacy policies and procedures when needed. Maintaining compliance with new regulations is going to be a struggle for every business—but keeping customers happy will be an even bigger challenge.

To ensure that you keep the right balance between privacy and personalized experiences, getting feedback from your customers will be necessary. Keep communication open and pay attention to how shoppers feel about any changes you make. Remember that transparency is the best way to reassure your customers and help sustain customer loyalty.

About the author
Jackie Long

Jackie is a Content Specialist at NS8. With a varied background and over 6 years of content creation experience, Jackie works hard to provide a compelling range of informative articles.

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