Understanding Consumer Attitudes Towards Personalization and Privacy

Data privacy scandals like Cambridge Analytica have seized the public consciousness and pulled into sharp focus the need for a consent-driven approach to marketing. Consumers want personalized offers, but they also want to control their personal information. This prevailing opinion was captured in our latest survey, Privacy, Personalization, and Promotions, which polled a cross-section of the U.S. population to better understand consumer attitudes about the types of promotions they value and how they want brands to treat their data. The results were both revealing and instructive.

Consumers Are Worried About Being Surveilled

Tracking consumers in the background, without their consent, is being met with greater resistance. Consumers say they prefer opt-in based data collection approaches by a two-to-one margin over traditional website data collection or social analytics. And skepticism abounds: 73 percent of consumers believe that brands are collecting and sharing data about them without their consent.

Despite this apprehension, consumers view brands as a reputable source of product and brand-level information. Brands are viewed more favorably than expected as a source of influence, significantly higher than peer recommendations, and higher than bloggers by a three-to-one margin. And a remarkable 61 percent of consumers say they prefer to learn about new products and brands directly from the brand itself — second only to friends and family members (73 percent).

The takeaway? Brands have a great opportunity to win over consumers by giving shoppers more control over their experience.

Retailers Should Pursue Personalization That Also Respects Data Privacy

Survey results confirm that consumers love promotions, discounts and personalization. The question is, how do you provide that without alienating shoppers?

One approach quickly rising to the top is the consent-based marketing technique of exclusive offers. Rather than delivering unsolicited offers with unknown impact, brands can create exclusive offers designed for highly coveted target groups, such as college students, teachers or members of the military. An exclusive offer enables greater control of a shopping experience because it allows consumers to indicate their interest by opting in. They get to decide when to exchange their personal data for access to a brand’s offerings, which is what they want.

This is good news for retailers because 94 percent of consumers said that exclusive offers would encourage them to shop with a brand. Furthermore, 43 percent said exclusive offers would make them extremely likely to buy.

An exclusive offer can also lead to purchases that may not have happened otherwise. Nearly three in five (58 percent) of those who would use an exclusive offer say it would increase their likelihood to purchase, either by being more likely to seek something out to buy so they could redeem the offer (41 percent) or more likely to purchase items than they normally would (37 percent).

Exclusive Offers Need to Be Protected

Exclusive offers work well because they elicit powerful emotions of the human psyche: the feeling of being special and belonging to a tribe. These emotions activate an urgency in consumers that can lead to strong results for retailers.

However, exclusive offers aren’t exclusive if you don’t protect them. The study also revealed that consumers were turned off by brands that didn’t protect their exclusive offers — i.e., the retailer made the offer available to everyone, but claimed it was exclusive. Eighty percent of these individuals say they would lose trust in the brand, over half (53 percent) would shop there less often, and 33 percent would recommend their friends and family shop elsewhere.

For retailers looking to simultaneously deliver on the promise of both personalization and privacy, consent-based marketing is quickly becoming the preferred path forward. It’s not just an opportunity, but also a responsibility. If brands can earn and keep their customers’ trust and be more transparent with how they’re using personal data, shoppers will reward them with purchases, word-of-mouth marketing, and the kind of loyalty that can only come with a high integrity customer relationship.

Jake Weatherly is the CEO of SheerID, a digital verification service for exclusive and protected offers.