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Why Is Ethical Data Use Important? (Part One Of Four)

Created at November 3rd, 2016

Why Is Ethical Data Use Important? (Part One Of Four)

Welcome to the World of Data-Driven Everything. 

We now live in a world of data-driven everything, and it’s an exciting place to be for consumers and marketers alike. From ordering an Uber to catching Pokémon, from intelligent fridges to cars that show you the way home (or even drive you there). It’s a world of ultimate data-driven convenience for consumers. But with these new levels of experience for consumers, come new levels of responsibility for brands. After all, once data is let out of the bottle, there’s sometimes no getting it back in.

So how can we, as marketers, make sure we’re doing the right things with customer data—collecting only what we need to provide those customers with the exciting, personalized retail experiences they crave? It’s time to more clearly articulate what constitutes ethical data use.

What is ethical data use?

Most customers know data is being collected about them. We leave it behind us like footprints in the snow with every card transaction, ATM visit, mobile phone call and website we use. In each of these situations we throw off signals that say something about our interests, behaviors and preferences.

It’s this information that enables brands and marketers to deliver exceptional, personalized experiences; the kind that really make an impression and inspire brand advocacy. The influence you can now have over products, services and experiences, and the value you can provide to customers is greater than ever. But, similarly, the more information that’s available, the more chance there is of it being misused.

This doesn’t have to be an intentional misuse, either. Often combining several sources of data can provide insights that neither marketers or customers knew would (or could) be generated.

In our new video series, The New Codes of Conduct, Sheila Colclasure talks about what it means to be ethical in a world where data quite simply is everywhere you look.

She points out that “today, most consumers know data about them is being collected and used for marketing purposes”, but warns those consumers may not be fully aware of the extent that it’s being used, especially as we move into this world of ‘data-driven everything’. This responsibility to ensure data is used ethically and to make customers aware of how it’s being used, ultimately falls into our hands as marketers.

Data misuse costs customers

In modern commerce there is almost an unspoken contract between brands and their customers, in which the former is simply expected to use data ethically. That’s why most of us never read the terms and conditions before clicking ‘I agree’. It’s simply easier to assume brands we trust will do right by you if they want to keep your business.

Sure, customers want to make sure their data is protected, but realistically, would anyone want to give up the amount of time it would take to really understand everything they’re signing up to? Does anyone even have that time?

So why is maintaining this trust so important? Consider this: in a recent survey by SDL, 79% of respondents said they’re more likely to provide personal information to brands that they trust. Ultimately, brands that lose trust will find themselves losing revenue, brand advocacy, and customers.

Brand reputation

But it’s about more than losing a group of wronged customers. An ethical approach to data use can have a long and lasting and potentially profitable impact on your brand.

The fact is—as the Harvard Business Review argues here—trust is now an important strategic asset for modern organizations, and what you do with your data is a big part of that. It should be used to benefit both parties in a transaction, culminating in the personalized experiences that delight customers and the increased profit that delights shareholders.

How do you make sure data delivers the right results for everyone? You need repeatable front-end processes for identifying the sources of data, the provenance of data, how it will be protected, and how it will be used to deliver the experience consumers want.

Sheila Colclasure describes this as “a deliberate method that enables them [brands] to do the right thing with the data, every time.” And it’s the ‘every time’ here that’s key. If you put these processes in place, understand the nature of your responsibility and perform ethically, everyone wins.

Want to learn more about why ethical data management practices are important? Watch the first of six videos to hear more from Sheila Colclasure, and read The New Codes of Conduct: Guiding Principles for the Ethical Use of Data for more information on ethical data use.

The next blog post in this series is also available here.

Part One: Why should we care about the ethical use of data? from Acxiom on Vimeo.