Data is supposed to be the new oil, powering all industries and underpinning major business decisions. That said, ask any Tom, Dick or Harry on the street what the word data means to them and they are likely to draw a blank. Even worse, thanks to a spate of recent high profile hacks, everyday consumers may also be likely to talk about the security and misuse of their data.
Thanks to the likes of TalkTalk, Lynda and Yahoo hitting the headlines, consumers are running scared with their data. In many ways, this move is entirely understandable and justified, on the other, it could do considerable damage to businesses if consumers withdraw the rights to access and use their data entirely.
It's increasingly likely that a few bad apples may ruin the fruit basket for the rest of us. With every business needing to use data to some degree, it's essential that all businesses take note of the lack of confidence customers currently have over how their data is used and stored.
As the saying goes, bad news travels fast, and this is never truer than when there is a story on a hack, data leak or misuse of data. In the past few months we've seen scares over Facebook and WhatsApp sharing data without permission, Admiral misusing Facebook data and of course, the infamous Ashley Madison, Yahoo and Talk Talk hacks. Against this wave of bad news stories, it can be difficult to get the good news out about how data is actually helping consumers - but this is vitally important, especially in the wake of such terrible examples of data use.
Every business has a responsibility to help educate consumers on how their data is being used. There is too much of a grey area over how data is collected, stored and analysed. Businesses must aim to plug this knowledge gap by opening up conversation with customers over their personal data.
This becomes even more important when you consider the General Data Protection Regulation (GDPR) coming into force in May 2018. Many businesses' data governance policies are a mess and the GDPR will expose them to hefty fines if personal data gets leaked. The legislation also makes it compulsory to explain to consumers how and why their data is being used, so being able to explain the use and value of data to the mainstream public will be more important than ever.
Of course, you cannot accurately explain something unless you understand it yourself, and this is where many businesses fall down. Many business leaders have little to no data literacy. If they cannot grasp the simple fundamentals of why it is important to collect and analyse data, how can we expect consumers to?
Given our increasing dependence on big data, current attitudes towards data are not sustainable. All businesses rely on data to some degree, from tracking sales over time to measuring the impact of a marketing campaign, data use is relevant to every department. If consumers withdrew permission to use their data, you can guarantee it will hit every business hard.
But there is a glimmer of hope. Over half of people surveyed by KPMG late this year stated that they'd be willing to share some data on their genders, ethnicity and education online. However less than 20 percent said they'd be happy to share more personal information on income, location or their web browsing history. That said, 63% stated in a Salesforce study that they'd be happy to hand over data in return for more personalised customer experiences.
There is definitely some give and take when using consumer data. Unfortunately, in our current climate, it seems customers get told more about the take and less about what data gives them. We all hate junk mail, and better use of data by business will practically do away with the spam clogging up our inboxes. At the same time, who wouldn't be pleased to receive promotions and rewards offered exclusively to them at a time when they needed it?
Then there is the value that data creates when combined with other data sources. Through combining sales, stock and product data, businesses can ensure popular items never run out. Biometric data combined with HR data can help prevent staff burnout, while sales, marketing and review data can provide personalised and useful product recommendations to customers. When we hear about data misuse or hacks, it is this value that is lost in the eyes of consumers.
Opening up the conversation with consumers is easy. It just takes a bit of legwork on a business' part to be able to answer the burning questions and concerns many customers have over their data. Businesses must explicitly state to customers exactly how their data will be used and who will have access to it. Making sure data is anonymous and cannot be traced back to individuals is critical, as is ensuring the data is stored securely. After all, a hack will significantly undermine any attempts to improve customers' impressions of data use. Once customers are reassured, businesses need to win them over to the idea by explaining everything they could gain from sharing their data. It is also vital not to share that information with any third party. Over 75% of respondents in the KPMG study were uncomfortable with their data being shared with third parties.
It's a crying shame that the potential and opportunities of using data is not well known by the average Joe on the street. Our future is going to be built on data and increasing numbers of businesses are currently waking up to that fact. We just need to make sure that as we get more data-savvy, we need to bring the public along with us before they rock those foundations and bring it all crashing down around us.
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