Companies today know that personalisation is one of the ways to grow share of customer; it is a business imperative, driven by the general availability of technology. It is the backbone of loyalty and one-to-one marketing campaigns. Successful loyalty and marketing campaigns are built on the premise that different customers need to be treated differently.
Personalisation is, however, driven by the ability to gather data about the people to whom you wish to market your goods or services. And it is in this data gathering process that the potential exists to overstep the bounds of generally accepted privacy rules and policies.
Bruce Kasanoff, a consultant with Peppers & Rogers, an authority on privacy, and author of the recently released 'Making it personal: How to profit from personalisation without invading', says the widespread adoption of personalisation is inevitable. "You will no more think of ignoring the differences between customers than you would think of charging a customer for a product you never delivered," he writes.
But somewhere between the privacy issue and the requirement for personalisation is a conundrum: How do I acquire and use customer data - and personalisation - to boost business while protecting customers' privacy?
Kasanoff has part of the answer, and it is quite obvious when you think about it. He says there is conflict because companies ignore the personal aspect of one-to-one relationships. They gather personal information so as to sell their products, rather than building on trust. And you cannot win a customer's trust if he suspects his privacy will be violated.
The conflict arises when companies view it from the 'wrong end of the telescope', in Kasanoff's words. And it is logical: If you are involved in personalisation simply to sell more goods or services, then you will end up abusing privacy. This is both the wrong approach to relationship building, and contrary to the spirit of one-to-one marketing. Instead, Kasanoff argues, you should use personalisation technologies to add value to your customers, to save them time and money, and to create goods or services that are more apposite to their needs.
"Make it personal, and you will make it profitable," Kasanoff notes.
Eventually, there will be only two types of companies in the world:
* Those that treat individuals in a personal manner and make healthy profits.
* Those that treat everyone the same and must scratch and fight to break even.
Against this injunction, companies had better sort out their personalisation-versus-privacy conundrum, and soon!
Doug Leather, MD of REAP Consulting
Ten lessons for marketers
Kasanoff lists 10 personalisation/privacy lessons in his book, 'Making it personal':
1. The border between our work and personal lives is not just blurring; it is disappearing.
2. Traditional companies pose the biggest threat to privacy.
3. Privacy is not just a marketing issue. Firms also collect personal information about employees, suppliers and partners.
4. Few people understand the extent to which monitoring technology is being used.
5. New high-tech monitoring devices such as facial recognition cameras and iris scanners are useless without widespread compliance. Individuals must see clear benefits.
6. Firms misuse too much of their information; thus, costs are too high and revenues too low.
7. Most firms use information in a manner that benefits them more than the individuals most vital to their success.
8. Firms should remember information for people, instead of just about them.
9. In a technology-driven world, privacy is impossible without personalisation. We each draw the line in a different place.
10. Personalisation is not a fad. It is the inevitable result of interacting through computers.