Survey: The Way To A Customer's Trust Is By Getting Targeted Ads Right

More than 80 percent of U.S. consumers say they're willing to share personal information with retailers, but they're not impressed with what retailers are doing with the information, according to a five-country survey released by Infosys (NYSE:INFY) on Tuesday (June 25).

That U.S. number—81 percent—is high compared with the average of 70 percent for the study, which also surveyed consumers in the U.K., Germany, France and Australia. (Germans, it turns out, aren't very trusting and drag the averages down.) The catch: Only 26 percent of U.S. consumers say they're willing to share detailed data such as social media profiles.

The survey also found that 85 percent of U.S. consumers want offers targeted to their interests and 81 percent like location-based offers. But 66 percent said online ads and e-mails aren't aimed directly at their interests, and ads on mobile apps are even worse: 71 percent miss the mark.

That may sound like consumers are schizoid about data sharing and privacy, but it may not be that complicated. U.S. consumers have demonstrated for years that they're willing to share their purchase histories with retailers in exchange for loyalty points or discounts. But social media profiles? That's a little too personal—you're a store, not an actual friend. To find the right middle ground, retailers need to start by not asking customers for too much.

As for targeted ads, that one doesn't even sound a little conflicted: Too many retailers just do a lousy job at aiming ads and offers at customers. Simple customer models are part of the problem, and so are marketing programs that want to send a particular coupon to every customer possible. "Targeted" means "the customer really will want this," no matter how much marketing managers want it to mean "if I include all these people I'll fill my quota."

That targeting success may be the best indicator of how much additional sharing customers are willing to do. After all, if a retailer keeps sending me the right ads and offers, that means the retailer understands me. And if I can trust its judgment, I'm more likely to trust it with a little more personal information. (The fact that the understanding is a CRM database and the judgment is an algorithm really doesn't enter into this bit of anthropomorphism.)

Sure, good targeting is expensive. But that's how you create trust—and move customers into the 81 percent sharing group.

For more:

- See this Progressive Grocer story
- See the Infosys survey summary (registration required)

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