With the growing acceptance of big data and what it can achieve for companies, more businesses are looking to secure additional types of data from consumers in order to leverage the insights to further improve the company’s products and services. Understanding what consumers think and feel about their personal data — including the confidence level the customer has placed in a company’s ability to protect that information, has also become part of the definition of big data.
Consumers want to have information on how individual company’s may share their information — and to what degree the company might try to influence a consumer’s decision. A company may have a relationship with a brand that has become a critical component of their overall growth strategy. In those perimeters, how will the company take, influence and share your information?
Researchers have also found this area of consumer behavior to be an interesting avenue of study. Matthew Quint, Director for the Center on Global Brand Leadership at Columbia Business School, and his colleague, David Rogers, published an October 2015 study on this topic.
To get a sense of what consumers think across various age groups and countries, the research study, entitled, “What is the future of data sharing?” more than 8,000 millennials, Generation Xers, baby boomers and the Silent Generation from the U.S., U.K., Canada, France and Mexico were included in the study. The results offer some insights that may help companies get the types of data they need from consumers while providing a new understanding of how consumers relate to brands and companies.
Personal Data Sharing Comes Via Trust, Rewards And Decision-Making Support
Although the consumers who participated clearly understood which data was the most sensitive, including address, mobile phone number, name and date of birth, they were still willing (75%) to share it with companies in exchange for a product or service they value and a brand they trust. Even more consumers (80%) were positively influenced into sharing personal data with companies when they received special offers or data-enabled benefits. These included reward points and product recommendations.
Besides brand trust and rewards in exchange for personal data, a decision-making tool for a complex decision was also noted as attractive for consumers. This tied to the findings that concluded consumers are also willing to share their data when they know a company can help them understand and control how their data is used. The consumers who participated saw the value in sharing their data because it can offer new types of value in return.
Quint gave the example of Netflix and how they built a robust recommendation engine that is helping users discover new content – something that could not have happened unless users let them gather data about what they were watching and when. He also noted companies like Mint and Billguard that analyze the data they receive to then help their customers learn and make better decisions about how they spend their money and how they protect themselves from fraud.
In a similar sense, but with a different goal, Pluto TV uses data to know what kind of content to go after. “Data helps us understand what type of content our viewers love and want more of,” said Ilya Pozin, Head of Growth for the company. “This allows us to improve our free television service by partnering with content owners that match the needs of our viewers. As a fast-growing startup, it’s critical that the millions of users we have now enjoy their experience so we can take the business to the next level.”
Understanding The Data-Sharing Mindsets
The researchers also discovered four different mindsets that they have used to help predict attitudes towards data sharing. While some are defenders of their personal data, there are others that are willing to share it but will take action in certain circumstances to protect that very same information from others. Still others are resigned to the idea that they have to share it while the smallest group is fairly carefree about their attitudes toward sharing personal data.
In identifying if certain age groups fit within a particular data-sharing mindset, millennials most often were completely comfortable with and willingly to share their information. In response, Quint noted, “Growing up in a digital age has made younger generations more accustomed to providing data to companies in order to use their products or services. In addition, younger people often perceive risks differently than older generations, and even where they see greater risk they don’t necessarily modify their behavior or attitudes based on this feeling.”
Data-Sharing Willingness Varies By Industry And Brand
Across age groups and geographies, data sharing is not equally distributed in terms of the willingness to exchange information for goods, services, information or rewards. For example, the financial industry has a higher comfort level among all age groups. Quint explained, “A long history with providing personal details to financial institutions is part of what drives this greater trust. In addition, there is likely an expectation that financial institutions are, by nature, more protective of data due to the high risks involved if information is not secured.”
While the financial industry is scooping up the personal data on its customers, other industries are not faring as well — like the airline industry, which scored at the bottom among the industries included in the research. In providing reasons as to why the airline industry is one of the least trusted, Quint stated, “Airline brands aren’t necessarily well differentiated, and people are often frustrated by their travel experiences, so they may not feel a sense of trust in the industry overall. Adding to this is the fact that people may fly different airlines based on price and do not have a strong brand preference.”
Bucking the trend is Southwest Airlines, which scored high in the research based on its brand reputation with those surveyed. When asked why the trust level was higher with their airline brand, Ryan Green, Vice President of Marketing for Southwest Airlines, noted, “We believe this is because we do business the right way. We work hard to demonstrate that we’re on the customer side because it’s the right thing to do. Time and again, we find it’s our no-surprises approach to travel, up to two bags that fly free, no change fees, incredible hospitality and low fares.”
Perhaps another reason why customers are so willing to share their personal data with Southwest Airlines is the focus they have put on delivering that aforementioned value that consumers are seeking from their own data. As Green concurred, “We spend a lot of time and energy asking customers, ‘What can we do to enhance the travel experience for you?’ If customers share specific information with us, then we’ll certainly use that to develop the best way to give them what they’re asking for. For example, we ask customers what cities they’re interested in flying to and use that to serve up specific offers to those locations. This extra step offers a more relevant customer experience for them.”
For all industries and business segments that want to use personal data to enhance their own customer experiences, it’s important to remember that customers are willing to share their information if they know you are using it to help them get what they want while ensuring that the information is kept secure.
It’s important to start working on building brand trust first and then gradually begin to open the door to collecting their personal data, providing the basis and benefit to what and why you are doing so. If Southwest Airlines and the financial services industry tactics are any measuring stick of success, then following suit will deliver similar results for other industries.
This article was written by Steve Olenski from Forbes and was legally licensed through the NewsCred publisher network.