As more retailers experiment with new technology to enhance the customer experience, companies have to walk the line between collecting personal information and coming off as too invasive.
Tara Kelly, CEO of Splice Software, a data-driven customer engagement technology company, says the best way to avoid "creepy" interactions with customers is to only utilize data that they have willingly given to the retailer. Using data that was not provided directly from the customer can quickly create distance between the user and the brand.
FierceRetail spoke with Kelly to get more of a sense of what today's consumers are and are not comfortable with and how retailers can best make use of what personal information they are privy to.
FierceRetail (FR): What kind of personal information are consumers more comfortable sharing with retailers?
Tara Kelly (TK): The answer to that question can vary widely—some studies show generational differences in willingness to share personal information, with millennials typically less averse to giving retailers personal data. But for retailers, the important thing to know is that virtually everyone is willing to share personal information if they receive something of value in return, such as money-saving offers, special event invitations, VIP treatment, etc.
The data consumers are often most comfortable sharing include information such as their name, birthday, product likes and dislikes, and future plans. Of course, some of the most valuable information customers can share is their personal contact information, including phone numbers, email addresses and social media usernames. That type of information is an invitation to become part of the customer’s life—if you have explicit permission to use it.
FR: What are some ways that retailers can collect this personal data in a noninvasive way?
TK: Making the value exchange clear is the first step, and the second is to demonstrate that you respect customer privacy and will abide by their preferences. It’s important to obtain customers’ permission while collecting data and to identify their preferences. This not only makes using that information easier, it signals that you understand the value of what they’ve shared and will not misuse it.
That’s the strategic part. There are many effective tactical approaches to gathering data in a noninvasive way, including invitations to join a loyalty program. Some retailers have had great success signing customers up by creating friendly competition among staff to secure customer signups. When retailers gather information, preferences and permission electronically, track progress toward signup goals and display results on a leaderboard, retail personnel gain an extra incentive to collect data.
FR: Ultimately, are consumers ready for robots like these? Why or why not?
TK: The robot Walmart is reportedly rolling out—one capable of analyzing facial expressions to determine customer mood and triggering alerts so store personnel can step up their customer service game—has already sparked privacy debates. But artificial intelligence (AI) that learns from customer cues and real-time data analysis plays a huge role in delivering relevant offers and information to customers today, and that will increase as more people use in-home personal assistants like Alexa and Google Home.
Over the next several years, I believe it will be just as important for retailers to be able to respond to customers who converse with their AI assistants as it was for businesses to build a web presence a generation ago. It will take a blend of art and science to create personalized voice and SMS communication that builds genuine connections between customers and brands. But the companies that prepare now by gathering data and developing response capabilities will be ahead of the curve.
It’s also important for companies to stake claim to the name customers will use to search for them on AI devices. Rather than innovating and building a strategy around a device type, companies should innovate and create a strategy around their brand. When people speak the company name to find information via an IA device, they likely won’t use the company’s full legal name. Businesses need to register and own the name customers will say when making a verbal inquiry via an AI assistant.
FR: How are retailers attempting to make consumers more comfortable with sharing information?
TK: Smart retailers are making their value proposition clear and empowering customers by giving them choices. They are asking customers for permission prior to making contact and gathering customer preferences, such as preferred platform—SMS, voice, email, etc. Of course, it’s also necessary to assure customers that their data will be protected. Retailers who address privacy concerns and show respect for customer preferences will build loyalty.
FR: What happens if a consumer feels their privacy has been invaded?
TK: It’s incredibly important to address consumer privacy concerns immediately, but rather than waiting for a complaint, retailers should gather customer permission for contact proactively, at the time they obtain the customer’s contact data. This practice can prevent misunderstandings, and it makes the customer feel empowered and respected.
FR: How will consumers' comfort level with robots and technology advance in the next few years?
TK: Technology is a part of everyday life for most of us already, and people are becoming increasingly comfortable interacting with AI assistants. Studies show that almost everyone with a smartphone has used an AI assistant like Siri. In-home AI assistants like Amazon Echo and Google Home are selling by the millions, and that is also driving greater acceptance of AI-human interactions.
FR: What else can you tell us about data, consumers and technology?
TK: I am a firm believer in technology’s ability to improve life, and data is an essential component in making that happen. Data volume has been increasing exponentially for years. As more devices come online via the Internet of Things, companies that can apply that data in meaningful ways can make stronger connections, reach customers at the right moments and truly make a difference in their customers’ lives. It’s an exciting time for businesses and consumers alike.