There is a scene in the film “The Minority Report”, where Mr Yakamoto – Tom Cruise – walks into the store and is greeted by a hologram that asks him whether he liked his last buy – assorted tank tops. I always imagined it to be something embarrassing.
Anup Garg, general partner at Foundation Capital, used Mr Yakamoto’s scenario to illustrate what could be the future of marketing technology in his recent report titled “The Decade of the CMO”.
He proposed that the future CMO would have “real-time access to anything they want to know” about their customers. They would have the “ability” to have a “complete picture of the customer” that would help them provide a more personalized experience of their brand.
What is not mentioned in the report is how a company would ensure that their customer’s digital privacy is protected while acquiring this “comprehensive” data. Does it matter? Yes.
We are witnessing a definitive shift in people’s attitude towards digital privacy. I think this is most apparent if we look at the changing legal scenario in the country. About ten days ago, the White House made public a discussion draft of Consumer Privacy Bill of Rights Act of 2015. The bill requires companies to communicate to its customers in clear terms how it “collects, uses and shares” their data. It also enables a consumer to ask a company what data it has stored about them and allows them to change or remove this data altogether. Many states have already enacted similar legal provisions.
In California, an assembly bill, The Right to Know Act of 2013, required the same of companies. It brought data aggregators and online advertising networks within its purview and broadened the definition of what constituted as “personal information” to include a person’s “location, buying habits, and sexual orientation.”
Technology companies that rely on user-generated content to attract advertisers opposed the bill in an open letter to Assembly Member Bonnie Lowenthal, who had introduced it. Their grounds were that to verify a specific user’s identity and to track each point of entry and exit during their Internet activity was a near impossible task. It would have resulted in a “deluge” of disclosures being sent to the user. In its response, the ACLU of Northern California pointed out that the bill only asked for a disclosure if a company could “reasonably authenticate” a user’s identity.
It failed to pass as a result of their proactive lobbying, but we are left with the question: Can we understand digital privacy differently in the future? Here are a few suggestions:
1. Digital privacy as “brand differentiator”
A July 2013 survey published by Forrester Consulting found that privacy would be a “brand differentiator” in the coming years. One of its analysts, Fatemeh Khatibloo, went so far as to propose that it would be “the next green movement.” Rather than see digital privacy as a challenge, we can see it as an opportunity to establish a genuine connection with customers.
2. Digital privacy is “radical openness”
Well … not just that. Josh McClure, CEO and founder of the real estate company Real Massive, in an article published in Entrepreneur magazine last year, suggested that companies practice “radical openness” about their data aggregation practices. He pointed out that whenever a company made an effort to be more transparent, it gained the trust of customers in return.
3. Consumer trust as a brand image
In his report, Garg, quoting a comScore research survey in his report, noted that over fifty percent of people polled said that they would not make purchases from a company that they no longer trusted. They also said that they would “openly criticize” these companies. More than half said that they would post negative comments online. Not what I would want out of a word-of-mouth campaign!
It seems then that your response to transparency-related issues matters – it affects your brand image, your consumer’s trust in you, and ultimately your future.