Personalise, dont intrude.
This article was published in 'The Hindu Businessline' dt 5th May 2005
PLEASE leave me alone and please do not call me on my mobile phone again," went a senior executive's angered voice, obviously disgusted at receiving an unnecessary call in the middle of an important meeting. "These people want to sell me a credit card at this time of the day!" he exclaimed, as everyone in the meeting watched him take this call.
If you are not unfamiliar with such situations and find them unacceptable, then you are not alone. Millions of consumers the world over are bombarded with unsolicited calls, visits and mail with little or no regard for the situation of the person being approached.
The `Right to be left alone' was discussed in the Law of Torts as early as 1888. However, its relevance in the current context has only increased.
In the course of many of our daily transactions, we have given out much personal information such as name, address, phone numbers, occupation and income. We are made to believe that the information sought is necessary to fulfill the transaction. But sometimes it may be irrelevant and an invasion of one's privacy. With advancement in Computer and telecommunication technologies, this information can easily be stored and transferred to multiple sources, compounding the problem. . And we as consumers have little or no control thereafter. Database suppliers and mailing list vendors are today's realities.
Lucky draw coupons, registration information and feedback forms are some ploys to capture sensitive personal information. As long as the feedback form in a restaurant seeks information about the food and ambience in the restaurant, it's fine - they are seeking feedback. But if it asks for your contact details and such, it is asking about you and you can ask them why they need to know that. Chances are, they will not know why. Well, better restaurants with organised set-ups will probably use this information to invite you when they run a food festival or such.
With the realisation of the benefits of relationship marketing almost overnight there is a phenomenal rush of people who suddenly want to know your contact details, birth dates, anniversaries, your likes and dislikes. This information is usually collected without a clear plan beyond that. The most enthusiastic marketer has not been able to go beyond sending that birthday card, if at all.
The problem is not limited to restaurants alone. There are a lot of people or organisations that have access to your serious personal information and don't know what to do with it.
The biggest culprits are the financial services companies. Look at their forms to realise the amount of risk you are exposing yourself to.
We give out extremely sensitive information in good faith. But do most companies live up to this faith? I suspect not, as the moment we sign up for a credit card, we are flooded with junk mails from nondescript marketers and we are left wondering as to how they got to know that we existed and where, with such remarkable precision.
Marketers have a responsibility to the unwary consumer which they must demonstrate in collection and usage of consumer data. The following are some ways: Collect relevant and essential information: Differentiate between `need to know' and `nice to know.' Always be prepared with an answer if the customer confronts you with " Why do you need this information?" If you don't have an answer that sounds convincing to you, don't ask - Simple.
Limit the usage of the information: Temptation to use this information for cross-selling is hard to resist. But always seek permission from the customer for using the data in cross-selling and promotions. Privacy advocates recommend the use of opt-in approach rather than the opt-out approach when sending communications.
The default opt-out option is considered intrusive as it is like saying, "I will contact you as long as you say I shouldn't." In contrast, the opt-in approach means that the marketer has to confirm if the customer is open to receiving cross-selling and promotional material. Most customers will see reason and opt in if you are able to convince them that they will genuinely benefit from the communication they receive from you.
Ensure that the data is accurate and updated: There is an example of this company which had to call off its relationship programme when a customer who was sent an SMS wishing him a happy wedding anniversary called back woefully to say his wife had passed away two years ago. Alas, the organisation had taken the data long time back but decided to use it now. Don't collect the data if you can't start using it immediately.
Go slow: Do not collect all information from each customer in a single interaction - it could intimidate the customer. Ask for a little at a time and if you are in the business for the long run, you surely will get more dialogue opportunities.
Restrict access: Never pass on sensitive personal information to any other organisation for any reasons whatsoever. Also, to prevent involuntary leaks, limit access of the databases to a few authorised personnel only.
Personalise your offerings: Assuming you have the customer's approval to communicate for cross-selling, try and personalise as much as possible. The carpet-bombing approach may be easier but may not go down well with the majority of the customers.
Don't flaunt the information that you possess: Make it look like providence or an amazing coincidence. Knowing and using the knowledge to personalise is great, but knowing and telling that you know is a strict no-no.
A customer is likely to feel extremely insecure on being told "Sir, I can see that you are using your credit card and bank account for withdrawing cash lately. I wonder if you wish to avail of our new personal loan scheme."
Enunciate a privacy policy: Always have a clear and stated policy which outlines your company's predilections towards handling privacy-related concerns. If you are able to convince your audience that all information vested in the organisation will be used to personalise the product offering for the customers and make life more convenient for them, then customers will expressly welcome it.
When a market nears maturity and acquiring new customers becomes a challenge, marketers fall back on CRM systems to retain and cross-sell to existing customers. They scan their databases with a fine-tooth comb to look for buying clues. In the process they overstep the line where noble intentions diminish and privacy intrusion begins.
Customers in the developed markets have been extremely un-pardoning when they feel they have little or no control over their personal information. Australia, Canada, the US, the UK and other European nations have offices of the Privacy Commisioner. There are strict laws that have been enacted to safeguard citizen's privacy.
Canada's PIPED law, which came into force fully last year, is a good example of what privacy laws are coming to. It encompasses all businesses and government and covers subjects such as Internet privacy, health records and direct mailing. Similarly, Australia's Federal Privacy Commissioner works with a set of National Privacy Principles.
It is only a matter of time before such customer sagacity comes to India and forces the Government to act. We are already seeing a string of PILs in this direction and some corporates are seen to be responding.
We as individuals and customers have to start questioning the intention of people with whom we trust with our personal information. As an extension of this marketers have to respect the privacy of the customers who have put faith in them.
If the suggestions and arguments presented above seem fastidious, then not collecting data or ignoring behavioural indications is equally preposterous. Simply because most of these analyses and observations will actually help the customer.
There is a thin line dividing personalisation and privacy encroachment. Today organisations are being forced to walk this tight rope. Implementing a privacy-heeding CRM programme needs a serious commitment.
The temptation to give up this forced inaction (despite having information and resources) is very high. Privacy commitment has to be sustained effort driven from the top. But once privacy consciousness sinks into all levels within the organisation, the results would slowly though surely show up. That's when `customers for life' would become a reality.
(The writer works with a national telecom company. The views expressed here are his own.)
(This article was published in the Business Line print edition dated May 5, 2005)
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