What do I need to consider when using customers’ data?
It is important to remember that while privacy laws may change, the privacy debate is not new.
Darren Vengroff, chief scientist at data analytics company RichRelevance, says those retailers with the best customer service have always known the most about their shoppers - not just about their tastes, but about their lives.
“They use that information to offer the most personal service possible,” he says. He adds more retailers now have the opportunity to do that. “A hundred years ago, very few people could afford this level of service but today, because much of the process can be automated at modest cost, more retailers than ever can benefit from personalisation.”
He adds businesses that collect and use big data need to prioritise and maintain the trust of their customers and use that data to create value. “If I as a consumer don’t understand what you will and won’t do with my data and who you will or won’t share it with, that is going to offset any value you create for me,” Vengroff says.
“It’s no different than it was a century ago. If a bespoke tailor started gossiping about his customers, you can bet he would lose those customers very quickly,” he adds.
The ball is in the retailers’ court: if they abuse the trust of their customers, value is destroyed rather than created, and they invite the kind of draconian regulation that is ultimately unproductive.
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