Delivering a Personalized Experience Without Triggering Concerns About Consumer Privacy

By Scott Wilkerson
woman wearing a paper bag with questions mark

As consumers, we experience it every day: the tug-of-war between our desire to receive personalized advice from brands vs. our need to maintain some level of privacy over our digital lives.

Marketers across all industries are wrestling with this paradox as well. On the one hand, they know they must provide ever-improving levels of personalization to keep their brands relevant in the hearts and minds of their customers. A Forrester survey suggests that 9-out-of-10 digital businesses are investing in improving their ability to provide personalization. At the same time, savvy marketers realize that if they are perceived as “going too far” and invading customers’ privacy, they risk losing consumer trust. It’s an admittedly delicate balancing act.

HawkPartners Personalization vs. Privacy Survey

HawkPartners set out to get a pulse on consumers’ attitudes and preferences regarding this tradeoff by polling a nationally-representative sample of over 1,000 US consumers. The insights we gained provide Marketers with guidance on how to deliver a personalized experience without triggering concerns about privacy.

Insight #1: Consumers Don’t Want Personalization at the Expense of Privacy

If personalization comes at the expense of consumers’ data privacy, there will be significant backlash. When asked directly, 3 out of 4 consumers say they value their data privacy over receiving personalized experiences or offers. While we recognize that what consumers do often differs from what they say, this data suggests that privacy is a significant concern among most consumers.

Gen Z consumers are 4X more likely than Boomers to value personalization more (22% vs 6%)

Insight #2: Consumers May Reject Your Brand Due to Privacy Concerns

In fact, a majority of consumers say they have directly rejected brands that appear to pose a privacy risk.  This sentiment is highest among consumers under age 50.  Brands that deliver personalization without triggering these concerns can therefore gain a competitive advantage.

Insight #3: Offer Clear Benefits for Sharing Personal Data 

Despite these dreary statistics, there is hope for Marketers! Most consumers understand that their data has value to a brand. Furthermore, their concerns about privacy in many cases can be overcome by offering them a clear benefit in return for their information (and, as described in the next section, by being transparent about intent).

Gen Z, Millennials and Gen X are all more willing to share personal information for these purposes than Boomers

Insight #4: Transparency and Clarity Build Consumer Trust with Brands

Further, if a brand can clearly and succinctly explain how a consumer’s data will be used, they can often overcome these concerns. In fact, if a consumer understands how a company will use their personal data, their purchasing intent for that brand will be positively influenced.  This is how brand loyalty and advocacy are established.

of consumers agree that, “Understanding HOW a company will use my personal data plays a significant role in my decision to purchase from a company or use their products.”

Insight #5: Context Matters: Brands Should Be Strategic on What Types of Personal Information they Request

Consumer comfort with sharing data also varies depending on the type of personal information being collected.Based on our survey,it appears that consumers are more willing to share objective, factual information that would otherwise be obtainable in a face-to-face (or virtual) meeting (e.g., descriptors like age, gender, media consumption, etc.).  In general, consumers are less comfortable with the information that they consider more “private” or “personal” (e.g. medical or financial information) being used for promotional purposes. 

Gen Z, Millennials and Gen X are all more comfortable sharing all types of personal data than Boomers.

Insight #6: Give the Consumer More Choice

Offering consumers greater choice when it comes to how their data is used can promote consumer trust. Finding the proper balance between privacy and personalization – including allowing customers to determine their individual preferences – can be a powerful driver of purchase behavior and ultimately, build consumer loyalty and advocacy.

To expand on these findings, we hosted an executive panel discussion with tech and healthcare industry experts. We talked about consumer expectations of data privacy and personalization, the challenges marketers face today, and strategies for optimizing CX.  Check out the recap where they share their best practices in providing customers with a personalized experience while ensuring that their data is secure and being used responsibly.

Connect with Scott Wilkerson about your brand’s personal data strategy.