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private data with it. As with interpersonal relationships, trust between a customer
and brand is complex. And as trust becomes a more important part of doing
business, the authors write, firms must view the trust they engender among
consumers as an essential asset.
Transparency. When companies request personal data, they must be
transparent about why they want it and what they plan to do with it.
Indeed, transparency is a cornerstone of recent data laws. When disclosing data
usage policies, firms must communicate in a friendly, straightforward manner, the
authors write, and not bury the notifications in fine print or legalese. Firms should
be up-front about data processing and third-party involvement, which many
consumers are suspicious of.
Type of data. It’s important to be selective when requesting customer data. In
the U.S. and E.U., particularly, people tend to be guarded about giving up
identifying information. Firms should consider the context of transactions and
then be careful not to ask for data beyond that scope. Most people wouldn’t give
a second thought to providing their address when buying something online but
would balk at filling out a form requesting shopping preferences or detailed
demographic information. Firms must keep the type of data they collect pertinent
to the transaction.
Access to customer data is a powerful business advantage. Companies that
stick to the three Ts can continue to collect this information and use it to drive
growth. Firms that flout the guidelines risk seeing their customers — and that
coveted personal information — defect to competitors. +
Source: “What if you ask and they say yes? Consumers’ willingness to disclose
personal data is stronger than you think,” by Grzegorz Mazurek and Karolina
Małagocka, Business Horizons, Dec. 2019, vol. 62, no. 6