TAPPING INTO THE GOLDMINE OF FIRST-PARTY DATA

Lindsay McEwan, VP &Managing Director, EMEA, Tealium

Lindsay McEwan
Lindsay McEwan

Companies often rely on the use of third-party data to anticipate customer behaviour and tailor their messaging accordingly, but with consumers becoming ever-more protective over their data (a staggering 92% are concerned about online privacy) – coupled with the implications of the forthcoming General Data Protection Regulation (GDPR) – companies are now looking to foster more direct relationships with customers.

Establishing customer preferences first-hand is key to building trust and enhancing the customer journey, and many organisations are sitting on a gold mine of first-party data without knowing how best to leverage the insight it can provide.

How can banks and financial services companies improve the customer experience through the use of first-party data? 

The first thing to consider is that ‘customer service’ – i.e. adequately fulfilling a customer’s specific needs as part of the contractual brand-consumer relationship – is very different to ‘customer experience’. In a sector where first-party data is so readily available– for example two-fifths of HSBC customers are digitally active, financial services companies should move above and beyond the traditional expectations of simply providing a satisfactory service,and instead strive to enhance the overall experience by proactively engaging the customer in meaningful conversations across all channels.

First-party data is the key to achieving a personalised banking experience and can also help to shape future marketing campaigns, so it’s important for companies to begin assessing their digital systems and developing strategies that really tap into their own pot of gold.

What are data silos and how can financial companies join the dots to create a better customer experience? 

There are many factors that cause organisations to operate in ‘silos’, for example customers accessing their bank accounts from multiple devices or liaising with different departments, meaning their data is often stored across disparate platforms. As a result, it can be challenging for the marketing team to build a holistic image when it comes to targeting individual customers.

The fact that data is generated in silos isn’t necessarily a problem, although for companies looking to provide a personalised, omnichannel customer experience, it is crucial to build a ‘bridge’ between these fragmented datasets. This can be achieved by implementing a universal data hub that pulls all of this information into a centralised system.

Although businesses can be apprehensive about investing in technology, it’s important to understand the benefits when it comes to gaining and retaining customers. Using sophisticated tools such as cross-device and location targeting technology, tag management, and real-time technology (such as chatbots) can help identify a customer’s needs before facilitating personalised, real-time responses in a matter of seconds – enhancing the customer experience.

When is the General Data Protection Regulation (GDPR) coming into force and how will it affect the banking industry? 

The new legislation comes into effect in May 2018, although it’s crucial for organisations to start evaluating their digital processes and procedures as soon as possible, to allow time to decide on the best digital data strategy for their individual business.One of the stipulations of the GDPR is that a business must adopt privacy-by-design processes, which means any new systems will need to be developed with privacy in mind from the outset.

With over a third of customers (36%) believing online privacy is more important than national privacy, businesses will need to demonstrate due diligence – not only through physical compliance with the GDPR but also through showing true compassion and consideration for customer privacy.

The GDPR applies to every business – including banks – that processes the data of EU citizens, regardless of where in the world that business is located. In a sense, this makes the GDPR, which supersedes all previous privacy guidelines, the first truly global set of rules to govern the way in which customer data is handled.

Essentially, banking and financial organisations will need to ensure they obtain explicit consent from customers – using clear, jargon-free language – before accessing any Personally Identifiable Information (PII). They will also need to explain how and why they are using the data, as well as giving customers the option to amend or even delete their details at any given time. Finally, businesses will not be allowed to share data with partners without explicit consent, which in turn will drive home the importance of relying on first-party data.

Companies should embrace the GDPR as an opportunity to hand back control to the customer – which is key to building confidence and renewing trust. Meanwhile, the fact that organisations will also have more control over the source of their data means they will be far less susceptible to breaches in data security, which under the new regulations will need to be reported to industry authorities with 72 hours. 

What can businesses do to ensure they are GDPR compliant in time for the May 2018 deadline?

The thought of implementing a suitable digital strategy before the deadline may be daunting, but for savvy, conscientious organisations who already place importance on customer privacy,a great change isn’t necessary.

A good starting place for any business is to ask the following: where is our customer data stored and exactly how do we intend to use it? Which third-party vendors currently have access to our data and how can we prevent unauthorised sharing for those customers who do not consent? What security protocol is in place should any accidental breaches occur?

It’s also important to delete any data that is no longer relevant to the business and resist the temptation to ‘panic share’ data with vendors and partners ahead of the new regulations, as this can lead to heavy fines.

Instead, focusing on first-party data will help businesses better target and communicate with consumers,restoring that all-important connection with the customer.

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