In this guest post, Manish Bahl (pictured below), senior director, Centre for the Future of Work at Cognizant, says taht brand/consumer trust is a quid pro quo that needs to be handled delicately…
What makes you trust someone? Maybe it’s because you’ve known them for a long time, or their personality and behaviours make them seem trustworthy. Maybe it’s because you know that they trust you and you feel like you can trust them as a consequence.
What is certain is that trust cannot be quantified or measured, and often comes down to elusive characteristics and traits such as reliability and integrity. Whilst understanding the significance of such traits is important in our personal lives, a heightened understanding and application of these traits can also improve the trust relationship between brands and consumers.
As organisations become more digitally focused and use increasing amounts of personal data to provide customised experiences, maintaining consumers’ trust has never been more critical to business success. This is especially true of organisations in the retail and financial services sectors, for example, where the use of consumers’ personal data is at the heart of sales strategies and product offerings. Yet, most organisations in these sectors still suffer from a lack of trust among consumers.
The ‘personal data vs. trust’ flow-on effect
A recent survey by Cognizant of over 2,400 consumers across the Asia-Pacific found 58 per cent of consumers felt that they had little control over the use of their personal data by companies. Furthermore, 65 per cent of respondents said they are concerned about how and where their personal data is being stored, eroding their trust in the brands holding their data.
This is a major issue as trust motivates spending and loyalty. What most organisations still don’t understand is that a loss of trust means a loss of business, whether it is in the short or long term.
A two-way street
Although most consumers have trust issues when it comes to letting organisations use their personal data, the majority (58 per cent) of consumers actually expect to receive personalised products or services based on their needs and preferences, particularly Millennials.
In an age where digital sharing on media platforms is commonplace, consumers are happy to let organisations they like and trust access personal data, as long as they are receiving something in return.
Organisations must understand that each piece of information they get from consumers has a certain perceived value. Consequently, when consumers share a specific type of information, they expect a certain level of ‘reward’.
Obviously, the higher the perceived value of the information, the less the consumer will be willing to share it, and the more the organisation will have to give in exchange. In other words, you need to put yourself in your customer’s shoes, and ask: ‘Is the risk of sharing personal information worth the return?’
The survey revealed that consumers in Asia-Pacific consider the following as the most valuable information they could share and, therefore, the information they’d be least willing to share:
- Banking and financial information
- Family-related information
- Data from utility and other bills
- Personal profile information
- Online buying behaviour
Consumers want to see and feel that the company using their data is grateful, and acknowledges the value of the information that is being shared. This includes curating experiences and tailoring goods and services to the customer, but also going beyond this by communicating effectively and transparently about how their data would be handled and how it will be used to make their experience better.
Transparency is the new spearhead
Almost half (45 per cent) of consumers in the Asia-Pacific are willing to share their personal information when companies ask upfront for permission to use their data and clearly state how it will be used. Interestingly, a whopping 80 per cent said improved customer service resulting from this data collection would motivate them to share more personal data.
In an ever more connected environment, companies must actively position themselves as transparent and effective communicators if they want to establish a trusted relationship with their customers, and continue to use personal data to increase loyalty and sales.
Trust and transparency are two key elements of the marketing mix, and should be considered by the C-suite as important KPIs.