Marketers Caroling to CCPA: ‘Winter Wonderland’

Marketers caroling may not be what immediately comes to mind to get you in the holiday spirit, but here’s a little ditty about how useful data is to marketers. Sing it along to the melody of “Winter Wonderland.”

To all my many friends who are marketers in the field — the California Privacy Protection Act, new data privacy laws in Maine and Nevada, and who’s next? — this, too, we will endure. All the same, we shall all find new paths to prosper in the New Year, and the consumer will be better for it.

And yes, we should all be looking — shouting from the rooftops — for a single standard law from Congress sooner than later. Americans deserve better!

Is this working for you? I accept, I accept, I accept, I accept, I accept, I accept. Opt-out. Opt-Out. Opt-Out. Opt-Out, infinitum. In your face on every site you visit, and on every app you use?  I want to control data flows about me — not with a browser, not with a default that fails the financing of relevant content — but this is too much. Better for all to have acceptable uses discerned from unacceptable ones — defined by benefits and harms, respectively — legislate THAT, and let innovations flow.

So please join me in my sing-along:

“There’s a tale, are you listening?
Data flails, for the christening.
A new law in sight.
About to take flight,
Drownin’ in a regulated land.

Gone away is the long tail …
Within the walls, a new prevail.
Competition, insights,
Strategies in plight,
Drownin’ in a regulated land.

On the home page we can place an opt-out
Make it clear that data’s not for sale

Another referendum will get plopped out
‘I accept’ and the Internet will fail.

Innovation, on a vacay…
As a patchwork, takes a mainstay
Know better than us
Who can we trust?
Drownin’ in a regulated land

In the filings we can set it all right
Consumer trust is all that we care
They’ll say, ‘are you kidding, you get no rights
Except for private actions in the air.’

And so we toil, we perspire
As the relevance gets retired
They say privacy!
We know it’s not free,
Drownin’ in a regulated land.

[And the big ending…]

Did you say $55 billion?

[Oh, yes] Drownin’ in a regulated land.

Happy Holidays, everyone!

Earn Consumer Trust Through ‘Surprise and Delight’ in a Post-Privacy Age

Recent consumer research from Pew Research Center shows we have some work to do persuading consumers to let us use data about them for marketing. Right now, the risks seem to outweigh the benefits, in consumers’ view. At least for now.

Recent consumer research from Pew Research Center shows we have some work to do persuading consumers to let us use data about them for marketing. Right now, the risks seem to outweigh the benefits, in consumers’ view. At least for now.

Marketing may be an annoyance to some — but too often, it’s conflated by consumers (and privacy advocates, and some policymakers) to our detriment into real privacy abuses, like identity theft, or hypothetical or imagined outcomes, such as higher insurance or interest rates — to which clearly marketing data has no connection.

There needs to be a bright line affixed between productive economic use of data (such as for marketing) — and unacceptable uses (such as discrimination, fraud, and other ills).

As consumers feel they have lost all data control — perhaps one might describe the current state as “post-privacy” — it is doubtful the answer to consumer trust lies in more legal notices pushed to them online. Consumers also have told Pew the emerging cascade of notices are not well understood or helpful.

Consumer Trust
Image Source: Pew Research Center, 2019

When Pew explores more deeply the root of what consumers find acceptable and unacceptable, opportunities for marketers may indeed arise. For example, the study summary states:

“One aim of the data collection done by companies is for the purpose of profiling customers and potentially targeting the sale of goods and services to them, based on their traits and habits. This survey finds that 77% of Americans say they have heard or read at least a bit about how companies and other organizations use personal data to offer targeted advertisements or special deals, or to assess how risky people might be as customers. About 64% of all adults say they have seen ads or solicitations based on their personal data. And 61% of those who have seen ads based on their personal data say the ads accurately reflect their interests and characteristics at least somewhat well. (That amounts to 39% of all adults.)”

This is why regulating privacy — from self-regulation to public policy — is so challenging. A broad brush is not the right tool. We want to preserve the innovation, we want to improve consumer experiences, while giving consumers meaningful protection from data use practices that are harmful and antithetical to their interests.

An Industry Luminary Lends Her Perspective

Image: Martha Rogers, Ph.D. (LinkedIn)

Martha Rogers, Ph.D., who co-authored the seminal book “The One to One Future”with Don Peppers in 1993, helped to usher in the customer relationship management (CRM) movement. Today, CRM  often manifests itself in brands seeking to map customer journeys and to devise better customer experiences, and a lot of business investment in data and technology.

Reflecting on privacy last month in New York, Rogers said, “The truth of the matter is, we always judge ourselves by our intentions. Yet we judge others by their actual actions. The problem is that everyone is doing the same thing with us [as marketers].”

How much of that business spending resonates with consumers? “When 400 chief executive officers were asked if their companies provided superior customer experiences, 80 — that’s eight-zero — percent said ‘yes.’ Yet only 8% of customers said that companies were providing superior customer experience. Customers also judge us by our actions, not by our intentions.”

Rogers told two “surprise and delight” stories that illustrate how powerful smart data collection, analysis, and application can be.

“We need customer data to get the job done. A regular Ritz-Carlton customer I know once asked hotel staff for a hyper-allergenic pillow for his room. Now when he goes to a Ritz-Carlton, he always has a hyper-allergenic pillow in his room. He told me he just loved how the Ritz-Carlton had changed over all its pillows to hyper-allergenic ones.”  Rogers said she didn’t have the heart to tell him it was just his room — and the hotel simply had recorded, honored, and anticipated his preference.

Another story came from insurer USAA. Upon returning from tours of duty in Iraq and Afghanistan, USAA sent a refund on auto insurance premiums in the form of a live check and a letter. The letter thanked the soldiers for their service, and reasoned that a car must not have been used much or at all, while a soldier was overseas — hence, the refund. “Do you know 2500 of these checks were returned by customers, uncashed?” Rogers reported, noting that many of these military families have limited means. “Wow, stay strong … keep your money — some of the policy holders said to the company. How do you compete in that category if you’re another insurance company?”

These two cases both show smart data collectoin — applied — builds customer trust and loyalty, no matter what their feelings may be about privacy, in general.

“There are three reasons why we care about privacy,” Rogers said. “One is because there are criminals out there. We don’t want to give data to the robbers or the hackers. Second is because some of us do have secrets — and I’m not naming any names. And we don’t want people knowing every blessed thing about us. And the third reason that we just want our privacy is because [our lives] can be embarrassing.”

Consumer Trust Is Like a Pencil Eraser

“Privacy in an interconnected world is a pipe dream, an oxymoron,” she continued. “Still, we have to access and use customer data to give those great customer experiences. So what happens now? We have to do things [with data] that are good for customers, and not for ourselves [as marketing organizations]. Regulations and laws are really just a floor.”

“If you want to be truly trust-able, it’s about doing things right. One lie can ruin a thousand truths,” she said. “Trust is sort of like the eraser on a pencil. It gets smaller and smaller with each mistake we make. So we have to be careful. Do things right. Do the right thing. Be proactive.”

“No matter how fantastic technology is, it can’t top that trust,” she said.

How many Ritz-Carltons and USAAs — surprise and delight — does it take to undo a Cambridge Analytica or an Equifax? I’m actually optimistic on this. Because better customer experiences, brand relevance, and resonance through data insights will continue to win. We just have to prove it, to the customer, millions of times, one by one, every day — in the very important data-driven marketing work we do.

 

8 Ways to Keep the Rust Off of Brand Trust

We in the marketing and public relations business talk a lot about brand trust. Do we walk it? With trust, simply put, you have a chance to succeed with prospects and customers. Without it, well, you do the math.

We in the marketing and public relations business talk a lot about brand trust. Do we walk it?

With trust, simply put, you have a chance to succeed with prospects and customers. Without it, well, you do the math. In data-driven marketing, where data is often described as the currency of customer engagement, here, too, trust is the bank.

Right now, sad to say, trust appears to be available only at a premium. There seems to be less and less of it at a time when we really need more and more of it. This is societal. It’s not just advertising and business where trust may be in short supply. Government, institutions, education, medicine, media all seem to be scrutinized, with a loss of trust in the balance. At a time when and where factual information has never been so available and transparent, fears of misinformation, opacity, and malevolence also appear to be heightened.

Believability is at risk.

I can’t fathom how to regain trust in all these institutions just now. But I can think of our world of marketing. Brand, and brand trust, matter more precisely now, because trust everywhere appears in short supply.

Recently, Edelman, a global public relations concern, published its annual “Trust Barometer” report, looking at trust issues among consumers across eight nations, among them the United States. I find the results illuminating, because it helps provide a blueprint of where brands might concentrate efforts to bolster trust.

MarketingCharts.com summarized some of the findings here:

brand trust chart
Chart Credit: MarketingCharts.com, July 2019

(Re)Gain the Trust Some Insights From the Report

Here’s my take on eight areas of the findings:

Product Must Perform

While it’s increasingly a customer-centric world, product still matters. Quality, performance, convenience consumers won’t even entertain trust if the produce/service fails the bar. In fact, it’s the biggest trust factor. Reputation may enable consumer consideration, but 67% of customers report they won’t come back if the product fails. More than eight in 10 consumers cite quality, convenience, value, and brand trust as a “deal breaker” or “deciding factor” in a purchase decision.

Trust: Why Now?

Consumers report several reasons why trusting brands is more important: 62% cite concerns about product experience (can’t afford a bad purchase, need products to keep pace with innovation, and reliance on brands for increased automation); 55% about customer experience (use of personal data, use of tracking and targeting, and use of artificial intelligence in customer service); and 69% about societal impact (fake news and misinformation, brand involvement in social issues, and affinity with personal values).

Yet There’s Considerable Room for Improvement

Just 34% of consumers trust most of the brands they buy and use. While some might see this as in indictment, I choose to see it as a huge opportunity. In the United States, overall, 54% trust businesses to do the right thing trust in government, by the way, is 40% .

The Trust Dividend Is Real

When trust is earned, the payback is pronounced. The difference between not fully trusting brands and trusting brands for a long time is a 28-point lift in percentage when considering what brand to buy first; 33-point lift in staying loyal; 27-point lift in being an advocate; and a 21-point lift in defending a brand.

We Must Walk the Talk

Remember greenwashing environmental benefits? “Trustwashing” is also a concern regarding brands and authenticity. Worldwide, 56% of consumers feel too many brands use societal issues as a marketing tactic to sell more product. Trust in business vs. trust in government has fallen off year-over-year between 4% and 6% in brands’ ability to effect positive change on societal impacts. If you’re buying into social good, it had better be the real deal. That means an enterprise commitment that’s followed through rather than a marketing promotion.

Most Consumers Have Taken Steps to Avoid Ads

I think it’s a mistake to say all ads are held in low esteem they’re not. Other surveys have shown that eight in 10 consumers still rely on advertising to discover new products and services. But three in four consumers have taken steps in their lives – ad blocking, paid subscriptions, and changed media habits to curtail the amount of advertising they see. More than three-fourths of consumers says they pay attention to ads from brands they trust!

Enable Reviews and Influencer Involvement

Most consumers say they trust what others say about a brand, more than what the brand says in advertising about itself. Working in combination peer review then owned, paid, or social content (ads) can work together to lift trust.

Run Hard

Interestingly, the more saturated the message (meaning, engagement across media channels), the greater chance for trust. One might think this doesn’t square with the previous ad avoidance message, but it goes to show repetition and reinforcement work. But only when the message is on-point, resonates with the user, and conveys authenticity.

Conclusion

Those of us who worry and work a lot about “trust” we have some mighty work to do. But even in an age of consumer skepticism or simply skepticism the hard, honest work of trust-building often becomes its own greatest reward, regardless of business payback. Despite all the doubts and pushback, consumers do want to believe this necessary work is getting done, and brands and ourselves can be all the better for it.

As Amped-Up Ad, Data Privacy Laws Near, Self-Regulated Programs Matter More

As we prepare ourselves for federal (and state) legislation around privacy and advertising, it’s worth taking account of our own industry’s self-regulated programs — both those here at home and worldwide.

As we prepare ourselves for federal (and state) legislation around privacy and advertising, it’s worth taking account of our own industry’s self-regulated programs — both those here at home and worldwide.

Why? Because even in an age of regulation, self-regulation — and adherence to self-regulatory principles and ethics codes of business conduct — matter. One might argue that legal compliance in industry is good enough, but business reputations, brand equity and consumer trust are built on sterner stuff.

Having a code of conduct is exemplary in itself, but I’d like to address a vital component of such codes: enforcement.

Self-Regulated programs
Transparency & Accountability in Advertising Self-Regulation Matter Greatly. | Credit: Chet Dalzell

Credibility in Codes Requires Peer Review & Accountability

Behind the scenes, every day, there are dozens of professionals in our field who serve — as volunteers and as paid professionals — to monitor the ethical practice of advertisers, who devise and update the codes we adhere to, who educate companies that proactively reach out to them, who work with companies and brands that go astray to resolution, and who enforce and refer non-compliant companies to government agencies, when necessary.

They may take complaints directly from consumers, competitors and industry observers. They may employ technologies and their own eyes and ears to monitor the marketplace. They may meet regularly as volunteers as a jury to deliberate on any need for corrective action. And, usually, they have a “contact us, before we contact you” operations effect: brands and businesses can proactively ask ethics programs questions about the “right” way (by the consumer) to execute a marketing practice, so it doesn’t prompt a formal query after a mistake is made after the fact.

Importantly, credibility depends, too, on reporting publicly on outcomes — potentially to “name and shame,” but most often to work cooperatively with businesses and to serve as an industry education vehicle in the reporting of correction and the resolution process. Generally, “punitive” is when a non-cooperative company is referred to a government agency for further action. Government agencies, for their part, tend to wholeheartedly welcome any effective effort to keep the marketplace aligned with the consumer. It helps when brands and consumer interests are in sync.

Accountability Programs Deserve Our Industry’s Expertise & Ongoing Financial Support

All told, these important players in our field serve us well, even as we face what might be referred to as co-regulation (government regulation on top of self-regulation). While any potential business mishap — for example, in the handling of consumer data or the questionable content of an ad — has its own set of facts and ramifications, a demonstration of good-faith efforts to adhere to ethical business practices might be seen as a mitigating factor, even as a brand finds itself needing to take a corrective action.

Agility, flexibility and responsiveness … these are all attributes of successful self-regulation — as well as successful accountability. Effective self-regulation serves to keep pace with innovations in our field, and “point the way” for other companies, as issues arise. (The rigidity of laws rarely can accommodate such innovations.)

While industry professionals may serve as volunteers on juries and review panels — it can be fascinating to serve on such panels — there is almost always an infrastructure of programs and staffs underpinning self-regulation success. Trade associations may finance some of these efforts with membership dollars — but usually businesses can lend their own resources directly, too. It’s great to have a seat at the table.

Marketing Ethics & Self-Regulation Programs — A Partial Listing

In all likelihood, there are potentially many more codes of conduct — particularly in vertical fields (pharma, travel, non-profit, retail, etc.) — but here is a brief listing of advertising-related codes and programs that may be helpful to catalog, bookmark, research and support, with some of which I’ve had the honor to be associated:

Please feel free to use the Comments section to suggest others. And thank you to every volunteer and staff person who serves or has served in an industry accountability capacity. It makes a world of difference, with marketplace trust of advertising and advertisers being the ultimate goal.

Customer Control Creates New Phase of Apologetic Marketing

In a customer-centric marketing ecosystem, brands need to be more self-aware than ever before. Brands must accept that customers control their reputation, and customer satisfaction should become a top KPI for every company.

In a customer-is-in-control ecosystem, brands need to be more self-aware than ever before. They need to open up honest, meaningful conversations with their customers — and understand that we no longer push advertisements to customers through media, but rather engage and communicate with them. Brands must accept that the customer controls a brand’s reputation, and customer satisfaction should become a top KPI for every company.

For years now, customers have controlled the way brands are perceived in the marketplace. Today, that leverage is only growing. Companies can no longer hide behind big brand campaigns, just as marketing can no longer put a good spin on a problematic or dated company. If they try, consumers will either ignore it altogether (because they recognize the idealized corporate-speak) or, worse, they’ll attack in social media. Then, what started as a small problem can get out of control quickly.

Marketing executives need to work with the entire c-suite to make sure brand promises and customer experiences are consistent throughout the entire journey. They need to ensure the brand pillars are not only communicated, but also embraced across every component of the organization. And they have to make sure every team in the company can live up to the vision presented in the marketing.

Over the last year, we’ve seen the disconnect play out on a grand scale for companies like Uber, Wells Fargo, Facebook and unfortunately many more. By not aligning the brand platform with their internal values and customer experience, these companies have had to publicly recognize their faults and apologize for missteps. They each faced distrust among their customer base and, even though that trust was lost in a second, it often takes years to gain back.

So How Can Companies Learn From These Brands?

In today’s marketplace, companies need to do three key things:

  • Be transparent. Customers don’t expect companies to be perfect. But today, customers aren’t just immune to, but are also appalled by corporate-speak and over-hyped, insincere brand promises. Customers want brands to be real, to mean something and to associate with their beliefs and values. Companies today need to be humanized so customers can connect with them.
  • Align departments across the organization. Customers perceive companies as one entity and they expect that, whether they’re in a store, on the site or calling customer service, they’ll have the same experience across the board. Companies, however, are made up of different departments, with different bosses (who have different beliefs), and are often measured against different (sometimes opposing) KPIs. Today, corporate structure needs to embrace customer expectations. Politics and personalities have to take the back seat to the unified brand vision.
  • Companies need to embrace their customers. They can no longer lay out their corporate vision and marketing plans without fully understanding what the marketplace needs — both today and tomorrow. They need to understand what customers are looking for and shape their products and their company accordingly. Most companies hate hearing this, but they also need to narrow their audience and focus their company. Very few brands can and should appeal to all consumers. Too many brands try to satisfy everyone, remaining conservative so they don’t alienate any prospective customers. In doing so, however, they don’t resonate with anyone. Brands that take a stand, know who their audience is and what they want, and mold their company around that always win. Even if they outrage a part of their base, they inspire and resonate with their core, turning them into passionate advocates who reinforce the brand and allow more organic growth.

What Can You Do When It’s Too Late and You’ve Lost Consumer Trust?

While it’s a situation nobody wants to be in, companies need to be honest, fall on their sword and open up to the gaps they have. Just like Facebook’s WSJ ad and Wells Fargo’s TV campaign, they need to promise to do better. But again, it needs to be more than a marketing promotion; it needs to be a genuine re-set, one that all departments and the entire c-suite embrace. If it’s not, it’s only a matter of time until you’re back in the hot seat.

The Sustainability of Consumer Trust

I refuse to jump on the privacy “scandal” bandwagon. It is rough listening in this week to certain lawmakers fail to recognize the absolute benefits accrued by consumers through the responsible collection and use of data for commerce, advertising and innovation. Yes, data handling requires stewardship — but that doesn’t mean “data” in and of itself — constitutes anything close to being a harm that needs to be regulate.

I refuse to jump on the privacy “scandal” bandwagon.

It is rough listening in this week to certain lawmakers fail to recognize the absolute benefits accrued by consumers through the responsible collection and use of data for commerce, advertising and innovation. Yes, data handling requires stewardship — but that doesn’t mean “data” in and of itself — constitutes anything close to being a harm that needs to be regulated, as if there were no rules already in place.

Whether or not I, as a voter, saw Russian-administered content online, in an alleged bid to stir up controversy and division among the American electorate, is an understandable concern. It should be investigated — because we need to isolate and diminish any and all “malicious” actors in our digital economy and democracy. Fraud, too, is a harm that must be isolated, identified and eradicated. You’ll have no debate from me here.

But let’s not conflate malicious actors with bona fide relevant advertising and content being presented to, and engaged by, consumers — a wholly beneficial outcome that public policy must acknowledge. Data, commerce and advertising are not dirty words — they are engines for job growth, innovation and — yes, even government revenue through taxes. Ads finance content freely available and useful to consumers and other businesses — and pay for journalism, too, and a diversity of content on the Net.

But all of this responsible data collection and use are useless if there is no consumer trust.

I argue that the U.S. approach to data regulation — legal restriction where sensitive personal information is collected, transferred and applied through sector-specific laws concerning health data, certain government IDs, personal finance, children’s data and credit — and where Fair Information Principles are applied for other data categories that do not have such propensity for harm. Consumers are extremely well-served by this regimen. It is far more harmful to have a breach of credit data, for example, than to have business entities share consumers’ advertising profiles in non-sensitive categories — the latter data use being wholly beneficial. U.S. data protections thus are wisely targeted and measured.

Ads pay the freight — and the economy grows as a direct result. Better for an ad to be relevant to an audience. I believe this is superior (at least for Americans) than other highly prescriptive regimes (read, Europe) that make little distinctions between data categories and require “opt-in” permissions for any and all types of data sharing, including that related to advertising and marketing. If consumers are inundated with opt-in requests for less sensitive types of data use, even for categories of use where they directly benefit, then inertia and fatigue will prevail and useful data flows won’t happen. I’m hoping businesses handling European citizen data will find ways to prove me wrong!

Is the motivation of such draconian restrictions in Europe really privacy protection as a fundamental human right? Or is it somehow questioning commerce, competition, diversity, trade and innovation, and other important social aims financed by advertising — all sacrificed on the altar of permission? Yes, consumer control should be a default with ad data — but affirmative consent should be reserved for data categories where the propensity for harm is real. This point of view, in Europe at least, is rhetorical — because the law is the law. And as of May 25, the General Data Protection Regulation is enforceable on all global entities touching EU citizen data. God Save the Queen and her data subjects, and perhaps all of us.

At a recent privacy conference, one of the primary architects of the European Union’s ePrivacy Regulation (a follow-up to GDPR) said, “What we are aiming at is to abolish surveillance-driven advertising.”

Surveillance-driven” advertising and “surveillance capitalism” — are Europe- and privacy-academic speak that seeks to link or conflate interest-based advertising with government surveillance of citizens. I mean, really? Ad tech may include companies not known to the consumer, and because brands enlist outside ad tech companies to help them make advertising inventory more relevant (and useful) to site and app users, and disclose such data sharing through enhanced notice mechanisms and privacy policies, somehow this still constitutes “surveillance” with all of its negative connotations. Let’s not forget that the intended result of these investments in consumer engagement is a more relevant ad, not a dossier!

We can see where some (important) heads may be motivated.

Back to the U.S.

Even something as innocuous as an ad served to a device — we have plenty of guidance for privacy rules of the road: Fair Information Practice Principles that are global, Data & Marketing Association Data Standards 2.0, Digital Advertising Alliance Principles and the YourAdChoices program (a client), IAB technical standards … and an active Federal Trade Commission (and other agencies, in certain data categories) overseeing the ecosystem, and enforcing privacy expectations — is both self-regulatory and legal.

The idea that the United States is a laissez-faire data free-for-all is pointedly not a correct assessment. In the digital world, we have 20-plus years of self-regulation, based on nearly 60 years of self-regulation offline. All of this premised on building and bolstering consumer trust. We have federal and state law in important data sectors. Through all of these decades, we’ve had an FTC minding the advertising/marketing store, growing the market, and — enforcing privacy and security of data through meaningful enforcement actions and consent decrees that serve as teaching tools to other businesses.

Instead of grandstanding and undermining years of hard-earned consumer trust, more policymakers — and perhaps industry leaders, too — should recognize how responsible data flows serve the consumer. Thus, they should back existing industry regimes that promote stewardship and governance — and hold us to it. Serving consumers, earning their trust, after all, is a shared goal by all responsible stakeholders.