Written by Michael Baxter. Published on Fresh Business Thinking.
In the era of social media, relationships between the customer and a business matter more than ever. A breakdown in that relationship, when trust is in some way seen to have been betrayed, can be amplified, and it may be nigh on impossible to repair.
Take the customer: remember him, recall her. To say that the customer is crucial to any business is a bit like saying oxygen is important to all breathing humans. But in the age of digital technology, the customer seems somehow closer. Technology has broken down barriers between the customer and business, and data protection illustrates this to a tee.
Trust is becoming the key currency between the business and its customer, and digital technology means transparency is vital for building this trust.
But while the headlines focus on our hardware, for example on recent WikiLeaks suggesting that the CIA can spy on us through our TV, maybe we need to think about data.
Take the Internet of Things. It is no longer people who are connected over the Internet, things, be they the contents of your fridge, traffic lights, or freight transport are, or are set to become, connected too. But as the IAPP said: “Connected devices and the applications are just enablers. The real value and threat to the user and business is the data. Perhaps the Internet of Things might be better named the ‘lnternet of Data’ as the amount of personal and sensitive data being collected is staggering.”
But it’s what the companies that collect that data then do with it that matters.
Google says that the data it gathers is used to provide a better service. But not everyone is convinced. The Danish Data Protection Agency, for example, has received a complaint relating to the length of time data stays on Google servers. The Danish consumer council Taenk, said that it “would like the Data Protection Agency to assess whether Google’s indefinite data collection complies with consumer’s basic right to privacy.” It continued: “We have become aware of the fact that Google today has 9-10 years of data on users with a Google account.”
Facebook has been in the public eye for a quite different reason. The social media company has been criticised for not sufficiently monitoring the activities of its users, and in the process, was accused of being too slow to react when it was informed about pornographic images related to children, on its platform.
Bizarrely, after the BBC informed Facebook of this, Facebook requested that the British broadcaster send it examples. Facebook then reported the BBC to the child-exploitation unit of Britain’s National Crime Agency.
Many might argue that it is good that Facebook does not monitor content published by its users more carefully, that makes people more inclined to trust it, except that when that means it is too slow to react to content that most people would describe as foul, it is then castigated.
Yet it is the collection and ability to analyse such data that partly explains why companies such as Facebook and Alphabet/Google are so valuable.
Then there is the issue of healthcare. The combination of big data generated by wearable technology, genome sequencing and medical records, analysed by AI, could yet revolutionise healthcare. But how much privacy must we give up to achieve this end, and how much can we trust companies not to abuse that data?
But if customers lose trust, feel as if they are being spied upon, that Big Brother watches them through the application of post-Orwellian technology, the damage to a brand’s value can be incalculable.
Now authorities are stepping in, and by rules such as the General Data Protection Regulation (GDPR), due to come into force in 2018, may be fostering trust as a matter of law.
The cost to a business in not complying with GDPR could be massive, with fines of up to four per cent of turnover or 20 million euros, but the damage that can be done to a company in failing to build trust with customers can be greater still.
Take as an example the GDPR requirement for opt-in. The regulation means that companies must be able to demonstrate that the individual has given consent for their data to be processed. The new rules outline that ‘silence, pre-ticked boxes or inactivity should not, therefore, constitute consent.’
But many companies have been applying the idea of asking customers to opt in for some time. Most of us get truly riled when we discover information about us has been used to market products to us, without our permission.
The company that can communicate its message, build trust and demonstrate to customers how its use of data on them is to their benefit, is at an advantage with, or without, GDPR.
We are entering an era when GDPR compliance is not only a legal requirement, it’s a requirement for sustainable marketing. And for marketing to create truly sustainable relationships with customers, it has to create trust.
The GDPR Conference Europe is being held on the 27th April, County Hall, London.
By Michael Baxter, Group Editor of Amplified Business Content.
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