Inspiring customer trust

The word 'data' may initially evoke word associations such as 'dry' or even 'boring', but it's the heart of any customer relationship strategy.  The insight that data can deliver could not be further from these words - it could be said this is inspiring and enlightening - and brands who have embraced data have certainly reaped the rewards.

Years of social conditioning has made consumers somewhat sceptical about giving up their personal data, and this has been exacerbated by brands not utilising that data correctly or efficiently.  Consumers have an inbuilt expectation that when they do entrust a brand with such information, it should be used in a way which directly benefits them.  

Three key causes of customer mistrust are:

1. Their information has repeatedly been used in an irrelevant way, lowering expectations;
2. The media has influenced the 'big brother' notion that data capture will not always be used for 'good' purposes;
3. Brands that have used data effectively to deliver relevance have not generally communicated this fact to their customers for fear of negative media publicity.

As a result, marketers need to follow three particular best practices to help them not only regain customer trust but also to build longer, better quality customer relationships:

1. Invest in understanding your customers
   Apart from a niche set of absolute 'destination' brands, such as aspirational luxury goods brands where consumers proactive seek them out, at some point a brand must become more pro-active in connecting with customers - and even destination brands are not immune to competition or changes in the market.  For example, for many years Blockbuster video stores, which started in the US and expanded to Europe, were a destination brand who dominated the market.  However they failed to adapt their customer relationship strategy and in the meantime others have innovated and taken their place at the top - brands such as Lovefilm in the UK and Netflix in the US who now offer live streaming of videos direct to screen.
   Taking another example, a car company recently unveiled its latest model via an online showcase that was streamed to over 400,000 visitors to its web site, and at no point did they ask for any customer data - not even a name.  This would have been a perfect opportunity to connect with potential customers, find out what they were looking for, and start building relationships.
   The importance of planning a more effective data strategy cannot be underestimated. Whilst most brands will have one, it should be reviewed to ensure it helps brands to interact with consumers and build quality relationships in the best way.  If they don't then perhaps the time has come to develop a new and more effective data acquisition strategy.
2. Unlock the power of customer data
   Several years ago, after partnering with the Nectar loyalty programme, the UK supermarket chain Sainsbury's was delivering a fairly basic points-and-prizes loyalty mechanism. But, after investing heavily in data analysis and support, Sainsbury's uses the Nectar data to deliver relevant offers to customers based on products they buy, inspirational ideas about products they might like, and a whole new store layout that better reflects what customers put in their baskets, making it easier to shop.
   By using data in the right ways, marketers can understand who their top customers really are and then target them more efficiently with well-deserved rewards, content they are likely to be interested in, access to events they will actually want to attend, people they will want to talk to, opinions or ideas they will want to hear, more convenient ways to transact, and propositions or offers that will really appeal to them. Delivering this kind of personal relevance builds loyalty and customer relationships rapidly.
3. Engage with your customers
   Customers have been conditioned to have low expectations of receiving value in return for giving data, so the time has come to give them a reason to believe otherwise. The modern reality is that customers are prepared to give up personal information if they think they will get something relevant in return. Young people are no longer giving their phone number to their friends, but instead their name or email address so they can connect on Facebook. The value of their interaction with a social network is much greater than interacting with an individual.
   Consumer expectations have evolved, with e-commerce brands increasingly being expected to combine content (e.g. social commentary, points of view, interactions, information and so on) and commerce to remain relevant in the face of an array of competition. Customers want more than just offers; they want help making up their mind, and even help using the products they buy. For example, you have to admire the DIY classes offered by UK-based DIY chain B&Q, or the fashion blogs posted by Mulberry. If you can use customer data to offer this kind of help in a more targeted way, why would you not tell your customers about it?

For any product, brand or service, is that delivering quality and kudos is no longer good enough by itself; brands need to connect and deliver unique value to remain front of customer mind.  Brands that have proven the success of this approach give customers a reason to trust them, and then deliver value in the form of relevance. Only by continuing to do this, both now and in the future, will enable brands to inspire trust from their customers, as this marks the foundation of any long term relationship commitment.