The Data-Driven, Personalized Experience Economy: What is the Role of Brands in This Landscape? (Part 2)

In today's world, where many people purchase goods and use services via smart devices, and connected devices generate personal data, how should companies earn customer trust to collect and utilize personal information? Consumers demand convincing reasons and value in exchange for providing their personal information.

In Part 1, we explained two of the four challenges facing corporate branding and marketing going forward: "value exchange" and "building a brand trust framework," using various corporate examples. We will continue to explain the remaining challenges in Part 2.

3.Aligning Brand Value with Privacy Measures

Are your privacy measures aligned with your brand value?

Direct marketers have handled consumer data for decades, but the volume and detail of data generated by smart products are unprecedented. The applications of this data are also powerful. As the landscape evolves, executives, IT teams, marketers, product/service planners, and legal counsel across business units are continually tackling new challenges.

Posting lengthy privacy policies alone is meaningless

 

It is well known that in 2012, Laurie Faith Rayner (Professor of Computer Science, Mechanical Engineering, and Public Policy at Carnegie Mellon University) estimated that it would take 244 hours to read all the privacy policies of the websites and apps that people typically use in a year.

Add to that end user license agreements (EULAs) and terms of service, and it's clear that few people have the time to understand, let alone manage, the meaning of their digital exhaust (the information generated by users' everyday use of digital technology).

With such a significant effort required, consumers cannot reasonably evaluate each company's data policies and trustworthiness regarding personal data handling. When a rational assessment of corporate data policies becomes impractical, a shortcut is needed: an emotional decision-making mechanism that supports a company's privacy policy.

A brand's clear stance on privacy protection

 

Privacy policies must become part of the brand image. Brand curators, marketers, and skilled designers must wrest control of data/privacy policy management from lawyers. This shift is already underway.

Since 2014, Apple has strongly emphasized protecting consumer data and privacy. It also equipped iPhones and iPads with advanced encryption. In 2016, Apple resisted the U.S. Department of Justice's request to create a backdoor into iPhones to allow police and security agencies access to criminals' and terrorists' phones.

Regardless of how one views this stance politically, Apple has sent a clear message supporting privacy and the protection of customer data.

4. Building a Trust Ecosystem

As opportunities to share consumer data and digital exhaust with other companies increase, are you considering how to maintain consumer trust?

As mentioned earlier (see Part 1 for the example of EpicMix, a smartphone app for skiers), many examples of using consumer data and digital exhaust to deliver great brand experiences exist in environments where a single organization manages all touchpoints, such as resorts, theme parks, and campuses. For instance, the EpicMix app can only be used within ski resorts owned and operated by Vail Resorts Management Company. However, as cities, cars, and homes become increasingly smart and rely heavily on connectivity, experiences will become even more customized and planned.

Centering on a specific customer journey, experiences will eventually span multiple brands, companies, and organizations. This presents a new challenge: How should brands express themselves when the scope of the customer journey broadens and multiple brands become involved? How can they maintain consumer trust while sharing consumer data and digital exhaust across corporate walls?

Experiences Enabled by Cross-Enterprise Data Sharing

Uber serves as another example implementing this strategy (refer to Part 1 for Uber's GPS data tracking service case). Uber's service began with hailing a car through its own mobile application. However, Uber subsequently evolved its service into a feature within other companies' applications.

For example, the United Airlines mobile app includes a button to book an Uber ride to the airport after checking in for a flight. This fits seamlessly into the customer's standard journey. Similarly, you can book an Uber directly from Facebook Messenger without leaving the app. Considering the convenience of booking a ride without opening a new app, consumers are likely to accept that information flows between the two companies.

The Key to Partnerships: Brand Trust

Automakers designing in-car experiences for connected and autonomous vehicles face a similar situation. Currently, most automakers offer third-party experiences like Sirius XM or Android Auto. Meanwhile, some companies are building their own proprietary experiences. We believe a blended experience will succeed in the market, but Chief Marketing Officers (CMOs) must carefully manage the trust ecosystem and partner with brands that enhance trust. Brands with low trust become weak points in the ecosystem, dragging even highly trusted brands down to their level.

The full text of this article (Part 2) is available in the web magazine "AXIS".

※Reprinted from an article published in the Summer 2016 issue of the "Journal of Brand Strategy."

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