Personalization and trust are two intimately related concepts. There is an extraordinarily powerful logical, symbolic, and semantic correlation between them, which we can summarize in two respects, both of which are crucial to business action:
- From the pandemic to climate change, the events of the past few years have transformed our lives to a degree that we probably do not yet have full knowledge of. In an environment where the points of reference that we have long taken for granted have been swept away, consumers are above all looking for a solid foundation: 88% of them believe that trust, in light of the changes taking place, is even more important, the resource that guarantees the success of any business relationship.
- On the other hand, the evolution in data collection and analysis technology, the explosion of social media, and more generally the increasingly granular knowledge derived from the exploitation of digital channels and tools can be seen as the response to (and at the same time the cause of) a widespread collective attitude: each of us wants to be seen, recognized, and heard. Each of us demands to be called by name by the companies to whom we give our attention and loyalty. Each of us is increasingly demanding to participate in communications that must no longer be simply two-way but fully personalized. And, the digital acceleration of recent years has only boosted demand for personalization on such a large scale that today, the majority of customers (73%) expect companies to fully understand the uniqueness of their needs and expectations.
Starting from a common root (the humanity of the actors involved), personalization and trust branch out, reinforcing each other in every area of our daily lives, and thus also within the system of business relations. Let’s try to clarify.
Transactions work with an “opt-in opt-out” mechanism. To unlock opt-in, where a person agrees to be involved in an activity, the only option is to be perceived as trustworthy enough to obtain that specific person’s consent. While trust is confirmed to be a human, subjective, and eminently personal fact, for it to function as a currency of exchange, it needs to be specified, to be given with respect to the individual attributes of the individual client. In this sense, personalization is a building element in relationships of trust, and always has been. Especially today, as consumer experiences are becoming digital-first, even more so.
Trust and personalization in the age of digital transformation
Ours is an intensely digitized and densely interconnected world where, in the past two years, 65% of customers have purchased products using digital or hybrid modes. This means that companies that have not yet built a solid online presence are experiencing a disadvantage that is bound to worsen. These companies, forgoing the opportunities for interaction that are instead enjoyed by those that have embarked on a digital transformation journey, cannot rely on the touchpoints created through new technologies and have no way of accessing the wealth of information needed to activate personalized initiatives. Not only that: the modes of interaction created with the spread of the internet and especially with the increase in possibilities for mobile connection have given rise to a real process of consumer empowerment, who today no longer passively suffers brand communications but can decide whether and how to get involved.
At the heart of these established trends (access to in-depth knowledge of the target audience and the renewed status of the contemporary consumer) lies the truly fundamental issue, one that concerns the role of trust in the company and finds its place among the overriding goals of any trust strategy. We’re talking about the delicate balance between personalization needs and data protection.
Data at the center of the delicate balance between personalization and trust
Technological innovation, we said, has empowered brands to provide increasingly fluid and personalized interactions. Consumers now take these kinds of experiences for granted and expect nothing less. At the same time, they are also more aware of their right to privacy and demand that their data be protected.
Achieving a balance between exploiting information and protecting privacy, between personalization and trust, can be a challenge: brands are faced with an extremely delicate situation, where even quite strict regulations such as the European General Data Protection Regulation (GDPR) reflect and amplify the public’s more cautious attitude toward data collection and use.
Microsoft was among the first to study how companies try to combine the need to deliver tailored experiences with the obligation (ethical, before legislative) to protect their customers’ data.
In its 2019 study, “Create smarter customer journeys,” Microsoft surveyed a large sample of “High Performers,” marketers whose understanding of their customers’ decision journeys had resulted in significant improvements in performance (up to a 45% increase in ROI). The attempt was to recognize (and understand the meaning of) those patterns and deviations that as a result of the increasing focus on data seemed to occur recurrently throughout the customer journey and to use that understanding to refine their marketing strategies.
The survey revealed that privacy was a top priority among the High Performers interviewed:
- 55% said they were very concerned about the consumer’s reaction to companies’ handling of first-party data
- 48% had reviewed their customer tracking system
While having more customer data than their competitors, these High Performers could boast of greater transparency in their use and they had safeguards in place to protect them. The level of performance had not been affected by the tighter limits they had applied to data exploitation, quite the contrary. The precedence for respecting the privacy of their customers had converted into better results.
The gist of our thinking is basically just that: as inseparable as they are from each other, personalization of the customer experience should not harm customer trust in any way. Only by putting the consumer’s interest first and treating the information collected carefully and respectfully can personalization improve trust in a brand.
Personalization and trust are at the heart of any company’s digital marketing strategies, and it could not be otherwise: the need to design increasingly profiled experiences for customers is what drives the need to earn their trust, and at the same time, that experience is a temporary end point within a trust-building process that feeds itself and is potentially endless. Anything that is an obstacle to the development of this virtuous circle must be promptly identified and corrected. And that’s why it’s perhaps more important to explain how digital personalization should not work than to dwell on how it should.
How digital personalization should not work
We have seen that customers today expect flexibility and attention, and how, with more choices and greater control over their personal data, trust is the key element in their purchasing decisions.
We cannot effectively intervene in a brand’s reputation and grow its credibility if we don’t recognize respect for privacy as the key element in creating and maintaining trust. Not only that, the data that consumers agree to share should never be used for initiatives that may be perceived as inappropriate, annoying, and unnecessary. Let’s look at an example.
How many times after making an online purchase have we been literally hounded, for days if not weeks, with ads offering similar or identical and therefore totally irrelevant products? According to a Gartner survey, 38% of consumers decide to abandon a brand if personalized initiatives become “creepy,” that is, if they are so insistent that they become disturbing. One of marketers’ main concerns should be to keep an eye on the “creepiness” of the digital personalization they are investing in. If not, they run the risk of eroding the trust credit they have built up and potentially undermining the possibility of future loyalty.
If consumers are willing to share their data as long as it results in better products and experiences, to live up to their expectations companies will have to:
- refuse to implement advertising algorithms that bombard users with suggestions for products they have already purchased;
- be transparent about how data is collected and used;
- allow consumers to opt out of data collection if they are not comfortable with it (making this option clearly visible on all their digital channels).
Digital personalization is one of the most powerful tools being used to engage consumers. It is also, we have amply demonstrated, one of the most “dangerous.” So, brands should make sure they use it as responsibly as possible, lest they undermine the trust they enjoy and lose a huge competitive advantage.
Moving from an ideal plan to a much more concrete one: how can you achieve personalization in a way that increases trust in your brand?
Personalization and trust: authenticity always pays off
Although it may seem obvious, almost trivial, being authentic is the best way to build customer loyalty. According to 74% of consumers, communicating in total honesty and transparency is even more important now than it was before the pandemic. This means that a brand’s story—which is made up of tradition, relevance, as well as stated and practiced values—should be told truthfully and come across crystal clear, even after the most astute readings.
If we shift the focus to the primary components of trust, namely the emotional connection, we find that 62% of customers say they are sentimentally attached to the brands they buy from. For such a level of connection to occur, brands must fill a deeply human need, a need that has much to do with both personalization and trust: that of feeling recognized, one among millions, of wanting to be rescued from the anonymity of a system that condemns us to invisibility, of being involved on an individual level.
The role of personalized communication in building trust
Let’s now combine these two feelings: the desire for authenticity and the need for recognition. To cement the trust of our interlocutors, corporate communication must not only be clear and direct and immediately reflected in reality, it must also be personalized. It can have a real impact if it possesses these requirements (authenticity and personalization). Neutral and impersonal interactions (receiving redundant offers, for example, or being left indefinitely on hold) end up alienating customers and damaging hard-won relationships.
With digital channels, consumers are now able to manage their information flows in a way that was previously unavailable to them. This has led them to expect their interests and priorities to be promptly identified and understood by the brands they come into contact with. This not only means that brands should have a strong digital presence, they should also provide personalized experiences through all their communication channels, from social media to the company website.
Every moment of communication between a company and its customers is an important and unique moment where the trust relationship can be strengthened or weakened. The outcome of each interaction between brand and customer (increase or decrease in the trust capital invested in the former by the latter) is determined by the degree of personalization of each communication.
From the implementation of artificial intelligence-based chatbots that respond immediately to specific customer questions, to recommendation systems that vary from person to person, from unique and interactive videos that incorporate customer data to dynamic and responsive micro-websites created to deliver an effective and engaging customer experience: through its technologies, Doxee offers advanced personalization that can help pave the way for improving customers’ trust in your brand.