The ‘Great British Data-Off’: using content as a sweetener

Marketers using big data to provide personalised sales messaging are not only putting their customer relationship in jeopardy, they are missing the chance of finding out what content a customer wants and how they want it, argues Cedar Communications’ Insight and Planning Director, Chris Rayment

Chris Rayment, Insight and Planning Director, Cedar Communications

It’s highly likely that you’ve heard data being referred to as the ‘new oil’. Perhaps, though, ‘oil shale gas’ is a more appropriate term. Customer data and its huge usage potential is salivated over by business and the government, but the general public is less positive about how their personal data is being held, used and shared.

According to recent Information Commissioner’s Office (ICO) research, 85% of Britons are concerned about how their personal information is exploited or passed on by businesses, and 77% are concerned about its security.

Clearly there’s an underlying current of distrust around personal data usage and security among consumers, most recently exacerbated by a scare story in the Daily Mail (Headline: “Sinister boast of data boss who says he has 5,000 pieces of personal information on EVERY British family”).

Personalised targeting is considered the Holy Grail for many marketers, but the ICO stats suggest that using customer data to ‘sell stuff’ via targeted ads or offers is causing huge concern. When collecting and subsequently using data it appears that too many brands are prioritising their ‘business requirements’ to promote themselves without also addressing their ‘customer requirements’. There’s no quid pro quo. Those brands are failing to remember the oft-quoted Bain & Co lesson that “it costs 5-10 times as much to win a customer as it does to keep a customer, and that a 5% increase in customer loyalty can translate into a 75% increase in profitability”. Brands that prioritise sales over data’s potential to retain customers overlook lifetime customer value and fail to optimise the potential of personalisation.

That customers are becoming wise to the value of their personal data is another area of concern. Companies such as Datacoup (datacoup.com) are readily paying out for access to it, which they then sell on to third-party companies. Increasingly, consumers will realise the potential of their data as an asset and companies are going to have to put together a very good case to get it.

So, the challenge is a big one. Company usage of data is afflicted by distrust, concern, exploitation, invasiveness, selfishness and creepiness. We need to change that, which is where content marketing comes to the rescue.

A recent Royal Mail/Data IQ study suggests that organisations are currently too focused on customer acquisition: “Tasked with growing the customer base, companies often fight shy of employing anything which might interfere with engagement and conversation, such as an extended data form.” The study suggests that this approach has resulted in a “worrying data gap” within databases, recommending that records such as “life-event data” should be collected in addition to standard demographics and brand ‘interactions’.

The Royal Mail/Data IQ study found that fewer than one in 20 companies had life-event information about their customers. The fact that demographics are commonly collected and used to target is particularly interesting in light of recent comments from Netflix that demographics are “almost useless” as an indicator of behaviour, and The Economist’s move from targeting based on demographic to psychographic (interests, attitudes and opinions) attributes.

An increasing number of big companies have moved to a single customer view (SCV) – in other words, a central amalgamated database, into which all customer data can be fed – enabling targeted, personalised comms. Cedar advocates Royal Mail/Data IQ’s suggestions to introduce extended data forms during customer sign-up and to populate SCVs with lifestage information. But we’d like to go one further. We also feel that it’s important that brands introduce customer content and content distribution preferences.

It’s not enough for brands to target communications based on demographics or browsing behaviours – it means you’re guessing what the customer wants and delivering a message based on lifestyle assumptions or purchase behaviours. Why not ask the customer what they want to hear from the brand when they sign up for the product/service? If we can ‘personalise’ content so that a customer gets branded content that they care about via preferred channels/platforms, it’ll go some way to addressing the looming issue of customers charging for their data. The value exchange is a customer’s data in return for interesting/useful/entertaining/quality content from the brand.

Our approach might seem like a step back from the ultimate aim of ‘extreme’ personalised communications, but giving customers content about things they have said that they want to hear about, rather than how they behave, takes away the Big Brother approach of ‘You are this/did this, what about this?’ We envisage that content preferences will be themed around a set number of subjects that the brand has authority to talk about, an approach that supports editorialisation and curation of content. So, less ‘robot’, more content marketing agency, meaning that there’s a better chance of the content being valued by the end user.

Recent CMA/TNS State of the Nation research showed that content marketing is best at engaging customers and building trust in a brand. Capturing a customer’s content and distribution preferences in a SCV might go some way to address the issue highlighted by the ICO about lack of trust in how a company uses and secures its data.

Building content preferences into a SCV has interesting connotations for the paid/owned/earned framework. Paid media will always be needed to drive traffic to owned media channels, but a database enabling personalised owned media content for prospects and existing customers via channels/platforms of their choice will reduce the need to spend as much money on the paid media element.

It’s a simple proposition: tone down the use of data to sell, and instead focus on retaining customers with quality editorial.

Five ways data can improve your customer communications

1. When personalising comms,

prioritise the customer benefit over the brand benefit

2.Remember data has potential

to be as useful for brand engagement as it is for selling

3. Ask for more information

on customers at sign-up or renewal to support more engaging communications

4. Move away from ‘profiled personalisation’

to ‘user set’ personalisation. Ask what content they are interested in hearing about from the brand and how they want it

5. Curate content

based on customers’ wants and needs as a way to get around the ‘creepiness’ of personalised comms

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