Thursday, April 30, 2015

Mobile Apps - Personalizing While Respecting Personal Privacy

All the data I have been reading this week suggest mobile users want and value a personalized experience on their mobile apps or mobile website, but on the other hand they don't like giving up their personal data.  That means it is imperative to find the right balance so a mutually satisfying relationship can be fostered.  As we all know, the more data you have on an individual, the easier it is to configure a personalized experience.

In a fresh Cognizant survey this week involving 5,000 participants, 68% reported they are willing to provide information on their gender, 55% their age, and 65% their brand and product preferences, but the majority are not in favor of volunteering much else.  That is an interesting answer since 80% of the same survey participants belong to one or more loyalty and rewards programs, and the biggest reasons according to 74% are the points or rewards for each dollar spent.  The second biggest motivation was automatic discounts for loyalty program members.  That tells us there is a willingness to give up some level of data privacy if the rewards and discounts are valuable enough.

Mobile retailers need to find out how much personal data is worth to their customer base.  They need to give up enough in points, rewards and discounts to motivate the sharing of more in depth personal data.  Collecting data on social media is not the answer.  In my research, consumers don't like the idea of any kind of data collection for marketing purposes from their social media activities.  It makes them mad.  Mad is not a feeling a consumer products company wants to elicit from their customers.

It seems to me that a bold, transparent process would be best.  The online and mobile retailer should place a value on data.  For example:
  • Answer 10 specific questions about yourself and your preferences, and I will give you an automatic 10% off your purchases.
  • Answer 20 specific questions about yourself and your preferences, and I will give you an automatic 20% off your purchases.
  • Answer 30 specific questions about yourself and your preferences, and I will give you an automatic 30% off your purchases.
Whatever the real value, we all agree that there is a value to data.  Finding the real value, and transparently using that information to provide a personalized user experience, benefits all parties.

I think IoT (Internet of Things) sensors may also play a role in data collection and personalization. Rather than make people uncomfortable by tracking more personal data, sensors can track product data and that can be used to provide a personalized experience for the owner of the product.  Here is an example - a man buys a bass fishing boat and a service agreement.  Sensors (as defined in the service agreement) collects data on the boat engine.  Information such as:
  • Locations
  • Activities
  • Usage profiles
  • Hours of operations
  • Data and time
  • etc.
The boat engine information is added to the customer's profile to provide a "boater's profile" that can be used to personalize online and mobile experiences.

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Kevin Benedict
Writer, Speaker, Senior Analyst
Digital Transformation, EBA, Center for the Future of Work Cognizant
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***Full Disclosure: These are my personal opinions. No company is silly enough to claim them. I am a mobility and digital transformation analyst, consultant and writer. I work with and have worked with many of the companies mentioned in my articles.