Data Protection

Personalization and Privacy in a GDPR World

Consumers are increasingly concerned about data privacy but willingly share their data with companies that have earned their trust.
Personalization and Privacy in a GDPR World
Image credit: sarayut | Getty Images
Guest Writer
CEO & Co-Founder of Evergage
7 min read
Opinions expressed by Entrepreneur contributors are their own.

By now, most people in business have heard of the European Union’s General Data Protection Regulation (GDPR). Marketers around the world have been preparing for the new law over the past year, while far too many companies over the past few months have been in a mad scramble just to comply.

While we are catching our collective breath from implementing measures to be GDPR compliant, let’s consider the long-term implications for personalization and privacy in a GDPR world. One thing is clear: concerns over privacy and data usage are only going to increase. We can spend time lamenting this change, or we can embrace it, see the good in it and leverage it for competitive advantage. I believe this change is an opportunity to build greater trust and differentiate through personalized customer experiences.

Related: The EU's GDPR: 6 Things Online Business Owners and Marketers Can Do to Prepare

GDPR and the impact to personalization

GDPR is an EU law that took effect on May 25th this year. It gives EU citizens more control over their data, allowing them to consent to what information about them is collected and how it is used. It gives them the power to demand their data not to be tracked or even deleted altogether. Significantly, the law applies to every company in the world that interacts with an EU citizen. GDPR applies to you if someone from the EU lands on your site, regardless if you are presently located in the EU or anywhere else.

The challenge with improved privacy measures is that data is at the core of any great personalized experience. You cannot truly personalize an experience in any channel -- on your website, in your mobile app, through your email campaigns, in your advertising or even in a store -- unless you know something about that person. And you can’t get to know someone digitally unless you can collect data. GDPR and the increasing concerns around privacy complicate this.

But it’s not all doom and gloom for marketers. As with any potential setback, you have to look at it as an opportunity.

Related: With GDPR Restrictions on Using Consumer Data, Marketers Will Need to Start Mining Moments

Why the GDPR challenge is really an opportunity.

The important thing to remember about GDPR is that it doesn’t prohibit you from collecting any data on customers and prospects. It just gives individuals more control over who can collect and store their data. That’s good news, because people are typically willing to share their data for good reasons. In a survey of more than 8,500 consumers from six different countries, Deloitte and SSI found that 79 percent of respondents were willing to share their data if there was a clear benefit to them.

The losers in this environment will be the companies that collect data by tricking people with shady tactics. The winners will be the companies that collect data in open and honest ways, then use that data to clearly benefit customers. Those companies will deliver good experiences that foster loyalty. Loyalty drives consumers to share more data. Better data allows for even better, more relevant customer experiences. It’s a virtuous cycle.

The key to developing trust and delivering personalized customer experiences in a post-GDPR world? Leverage customer data to deliver real value. That sounds obvious, but it needs to be said. Deliver enough value with each interaction so that your prospects and customers decide to share more information with you. Then, deliver even greater value in return. They’ll offer up their information, and continue to do so, because they appreciate the service and benefits they receive.

Related: 10 Questions to Ask When Collecting Customer Data

For example, I’m a big fan of Spotify. I create my own playlists and I love the Daily Mix playlists that are created just for me based on the music I like. So whichever device I use to listen to Spotify, I actively want to log in so that Spotify knows me and can deliver my music. I don’t want to lie about who I am, create a bunch of different accounts so Spotify can’t track me across devices, or even ask them to scrub my data. I want Spotify to recognize me, track what I listen to and make recommendations for music I may like. And with every day that goes by, I am less interested in trying a competitor because that competitor doesn’t know me.

The Amazon Prime loyalty program is another good example of a company building trust while collecting a lot of data. The genius behind Amazon Prime isn’t just the free shipping, it’s that Amazon has figured out how to provide enough value that you want it to know who you are all the time. You want to log in to access the streaming video, to get product recommendations that are relevant to you, to access free shipping when you purchase something and more. Every consumer knows that Amazon is collecting data on them, but they trust Amazon and don’t mind freely sharing their data in exchange for the provided value. Amazon has used Prime and personalization to add another huge differentiator to its offering. Its competitive advantage is more than the breadth of its catalog, the number of reviews it has and its shipping speed. It is about knowing you as a person and providing the best personalized experience.

But your company isn’t Spotify or Amazon. How can you truly provide real value in the same way? How can you deliver experiences that will inspire individuals to want to share their data?

These are the key questions. The answers vary within industries, for each individual company and even within use cases. Let’s explore one example. Consumers willingly give their financial data to financial institutions when they become customers, but those financial institutions can’t wait until someone becomes a customer to provide a personalized experience. They need to deliver value to their prospects now to build a relationship to become each prospect’s trusted provider over time. An investment company, for example, may want to ask each prospect how much money she is looking to invest, what her investment goal is, what interests she has and what kind of investor she is. If these questions are asked “so we can sell to you better,” it is unlikely that the prospect will answer or engage. But, if these questions are asked “so that we can send you a weekly email that describes an investment option relevant to you and includes a few bullets on the pros and cons of that option,” now the prospect may happily answer the questions because she will get something from the exchange of data. In other words, a relationship is being built.

Related: What the Facebook-Cambridge Analytica Data Leak Teaches us About Ethics And Privacy

All the hype around GDPR can be disconcerting for any business. You can stick your head in the sand and fret about lost opportunities, but why do that? Embrace GDPR and use it to inspire you to deliver real value to your prospects and customers, build trust and loyalty, and rise above your competition.

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