Privacy, personalization and advantages of first-party data


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As data privacy concerns spike, brands are turning to first-party data to protect customer experiences and fuel personalization.

For business, data comes with tension. While consumers now consistently express a preference for personalized content and services, they’re also highly suspicious of how companies use their personal data

One recent report found that only 40% of consumers trust brands to use our data responsibly. Another study found that 94% of consumers feel it’s important to have control over their data, as well as an understanding of how it’s being used. 

This sweeping public concern has already caused new privacy regulations to be instantiated right across the globe — with approximately 75% of the world’s population soon to be covered by a GDPR-esque ruling. 

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Simply put, this issue isn’t one that brands can afford to ignore. 

‘Listen up’ strategy

In a move to adapt to this new environment, a number of businesses are developing strategies for collecting and managing their first-party data. With full access to this information (which is collected from their own customers), any brand has the power to control privacy settings and transparently communicate how that data is used, as well as who gets to see it. 

Well over a third of businesses (37%) are now exclusively using first-party data to personalize customer experiences, and the evidence tells us that this is what consumers want. In surveys, a majority have stated that they’re fine with personalization — provided brands are using their own data that was acquired voluntarily. 

Responses like this make it clear that customers want a transparent “one-to-one” relationship with their favorite brands. And that means businesses developing a voice AI strategy should really be listening up.

Where voice AI is fully owned and custom-built for a specific business, it puts that business in control of their customer data. It allows them to set the rules of how the data is managed, how privacy functions, and how that is communicated. It also grants full access to the valuable data insights that allow businesses to develop an effective product to fit their customers’ needs. 

When voice AI is subcontracted to Big Tech voice assistants, this control is entirely relinquished. That means that data visibility becomes opaque, and privacy, transparency and — ultimately — the trustworthiness of the brand is left to another business with an entirely different set of objectives. 

Growing trust, and relationships

With the use of voice tech growing exponentially, businesses that choose Big Tech voice assistants can expect voice channel customers to be kept at an arm’s length. And with no scope to develop that channel by means of their own insights, nor any way to dissect pain points, there’s a high chance of undetected customer frustration and missed opportunities. 

Just as critically, the Big tech option leaves brands with no way of controlling the customer experience when it comes to privacy and how their data is used, stored and shared. That’s no way to build consumer trust at a time when public audiences are so easily alienated. 

If one thing is clear, it’s that modern consumers — and particularly GenZ — are insistent on transparent, two-way communication from their brands. They want authenticity, and they do want personalization, but on their own terms. When it comes to understanding and relating to these customers the opportunity for natural, intuitive voice AI as a channel is enormous. But the stakes are high, and responsibility for personalization and privacy should not be left to another business. 

Zubin Irani is chief revenue officer at SoundHound. He was previously CEO of Cprime, Inc., and he earned his two MBAs concurrently from Columbia University and The University of California, Berkeley.

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