thoughts / Can personalisation be privacy focused

How do companies find a balance between personalisation and privacy? The truth is that the data that the big tech companies collect on us

Thanks to data, we are all tech companies now. As a result of scandals surrounding the hoarding of personal data to be used for private gain, from dynamic pricing to the Cambridge Analytica scandal, companies are now beginning to come under increasing scrutiny with regards to how they store and use our data for their own profit.

Contrary to what might be expected, we will find that increased privacy does not need to lead to a reduction in revenue and that an increased focus on privacy in conjunction with personalisation can drive revenue making conversations.


The Data Revolution

Data is revolutionizing how almost every company works regardless of industry or the size of the business. Whether it is keeping track of their customers, tracking their inventories, or monitoring their supplies, every company will be seeking to use data in some way to improve their ability to make decisions to improve the productivity and efficiency of their business. No one knows this better than the major players of the internet platform boom, such as Amazon, Google, and Facebook who have long known the power to be gained from hoarding masses of personal data.

Sharing your data is easily done when it comes to big sites such as Google or Facebook. From our birthdays to our income level these sites are able to collect the data we give them and use it to their advantage. If you think about all of the apps and websites that you have given personal information to it is likely that there is a lot more known about you out there than you first realised.


Does personalise require all the data?

Personalisation is clearly important in terms of satisfying and retaining customers, Accenture reported last year that 41% of customers swapped brands giving a lack of personalisation and trust as the reason. However, privacy is increasingly important to customers who are becoming more aware and concerned about how companies are using and misusing their data. Research conducted by CBI found that 84% of customers valued the protection of their personal information and a strong data security policy as their key priorities before parting with their well-earned cash. The same study also found that 54% of customers believe that companies have misused their data and 50% wished for an increase in transparency as to how companies use their data.

So, how do companies find a balance between personalisation and privacy? The truth is that the data that the big tech companies collect on us is not completely necessary to conduct effective personalisation and knowing too much can clearly be disconcerting for customers who may disengage from misuse of their personal data. It is clear that, while personalisation can be effective, companies need to be more transparent about the data they are collecting and deliver a personalisation strategy that does not feel invasive.


Facebook

Following the unlawful sharing of millions of Facebook users to a third-party app, which was then shared with Cambridge Analytica, Facebook has been forced to improve its privacy policy. This has included:

  • The removal of the setting which allowed other apps to access your data if a friend has installed them (a setting which many users were unaware of until the Cambridge Analytica scandal).
  • If you use Facebook on your phone all the settings have now been consolidated to here rather than spread across numerous devices.
  • Added a revamped and more comprehensive list of privacy settings.
  • Created an easy to use ‘Privacy Check-up’, a short questionnaire which makes it easy for you to select who can access what on your page.
  • You can also download all of your data from Facebook and adjust the privacy settings for each post or photo, hide it or delete completely (however, the complete ‘clear history’ feature which was promised is yet to materialise).

Increased privacy for users on Facebook is still in its early stages and, with $55 billion a year made from advertising, many are sceptical about Facebook’s commitment to data privacy. However, as can be seen above, a focus on privacy is becoming an increasingly smart decision for companies. Facebook has already lost users due to their lack of regard to privacy so putting data privacy at the top of their agenda needs to be more of a priority than intrusive personalisation tactics.


Google

Google released a new privacy policy in March 2018 to ensure that they were in line with European GDPR rules. The actual content of the policy is unchanged, but it is easier to understand and shows users how their data is used and how to control their privacy settings on Google. You can now easily turn on and off location history, as well as look at past searches and delete all previous online activity.

But what does this mean for Google? Google essentially makes money from adverts which are tailored to our search history, however, the amount of data they collect and retain has been criticised as excessive. It is too early to tell whether an increased awareness of customers of how their data is used will impact on Google’s profitability, however, with an increased focus on data privacy customers may well turn to other surge engines which prioritise this.


It is clear that companies are facing the privacy paradox – attempting to provide personalisation in a world where privacy is becoming more and more of a priority. However, an increased focus on privacy does not mean a reduction in revenue and the evidence shows that respect for personal data, rather than intrusive personalisation techniques, can go a long way in terms of customer retention and satisfaction.

At RARELY we thrive to make privacy centric solutions but there is always a balancing act. For example, we don't track visitors to our website, because why should we, those cookie bar are annoying and many of our audience will have tracking blockers enabled anyway. But this does mean we have to find alternative ways to see what posts people find interesting and engaging to read on our site. So if you enjoyed reading this post please send us an email ([email protected]) to let us know.