By Michael Green, Director of Insight, Transactis
At a time when the concept of ‘big data’ is increasingly being discussed by mainstream media, consumers are more conscious than ever of companies collecting their personal information and using it to track their behaviour, needs and preferences.
This growing awareness is leading some consumers to consider how responsible the firms using their personal details are, and whether they are taking good care of this data – in other words, they wonder whether they can trust the companies with which they do business.
When Transactis commissioned a survey of more than 1,000 British consumers in the first quarter of this year, 95% said they would terminate their relationship with a company if it handled their private details irresponsibly, got them wrong, passed them to third parties, failed to keep them secure, or otherwise abused their trust.
More than two-thirds admitted to actually ceasing to do business with a company within the last three years because it had, in fact, mishandled their data and could no longer be trusted.
These results make it clear that responsible use of personal data is essential to gaining customer trust and maintaining loyalty. Indeed, the research also found that companies demonstrating the conscientious use of customer data by tailoring communications, offers and services are rewarded with customer loyalty and longevity – 83% of survey participants were keen to stay with a firm that deals effectively and conscientiously with their details.
It comes as little surprise then that supermarkets, many of which gather and use large amounts of customer data through loyalty schemes and other sources, were rated most highly by consumers in terms of handling personal details responsibly and using them to provide better and more personalised services, communications and offers.
The respondents were asked specifically how they would rate the organisations they deal with directly – such as “your main supermarket” and “your bank” – in terms of handling of personal details responsibly and effectively (from “very poor” to “very good”).
As an organisation that consumers have entrusted with some of their most confidential information, “your GP” was included as a benchmark, receiving the highest “very good” rating but not the highest combined “good” and “very good” score. Overall, “your main supermarket” topped the results, with 84% of consumers rating their supermarket brand as “good” or “very good”.
The confidence consumers have in supermarkets shows that using data to track consumers’ preferences and behaviour is paying off. This result is a strong indicator that the vast majority of consumers are aware of, and value, their supermarket’s efforts to better understand their needs and meet those.
They see these companies collecting data on what, where and when they are purchasing, and then using this data to good effect in a multitude of ways – whether that is sending them communications and offers that are ideally suited to their particular circumstances, locating stores in convenient areas, stocking the products they want in their local branch, providing the service options they want, and other actions that improve the customer experience.
As consumer concerns over living in a ‘surveillance society’ increase, more than ever companies must prove themselves able to responsibly handle and utilise their customers’ personal data effectively. And supermarkets are already proving that central to achieving this aim is the proficient use of the data the company already holds.