Data & Privacy Marketing

For durable brand value, businesses must embrace data transparency

By Jon Suarez-Davis, Chief strategy officer

February 23, 2023 | 8 min read

Consumers will reward companies that give them real visibility and control over how their data is used, writes Ketch’s Jon Suarez-Davis.

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Today’s businesses understand the power of aligning with customer values in areas such as sustainability and diversity – and the importance of going beyond marketing spin, and offering real transparency (via clear proof points such as emissions data or hiring and compensation metrics) into how they put their values into practice.

Brands that ‘walk the walk’ are better equipped to cement lasting customer relationships: shoppers are twice as likely to purchase from transparent brands, and almost three times more likely to forgive subsequent slip-ups.

But there’s one key area where brands consistently fail to use transparency to drive durable brand value. We live in a data-driven world – but few companies offer visibility into their data practices, relying instead on opaque privacy policies that consumers seldom read or understand.

That’s a missed opportunity. Consumers know that data practices impact their safety and wellbeing, making transparency an under-leveraged superpower when it comes to building brand value. Companies that get this right have a chance to stand out – and build enduring customer relationships anchored in trusting exchanges of value.

Why data transparency matters

What makes data transparency so powerful? Consider this: the label on a jar of baby food might declare both food miles and potential allergens. The former helps a consumer make a purchase that aligns with their values – but the latter helps that consumer keep their child safe. In the same way, data transparency transcends brand values, giving consumers control over something that directly impacts them.

This is important because consumers view data as a valuable asset. They’re willing to share data with brands to gain personalized experiences, better products or services, or other benefits. But they want that exchange to be grounded in honest communication about how their data will be used.

Nine out of 10 consumers say data transparency significantly improves their brand relationships, according to research by Ketch. In fact, data transparency is the single biggest factor determining consumers’ brand preferences.

But consumers are also ambivalent about how their data is used. Six out of 10 consumers say that poor transparency makes them reluctant to share information, and a proliferation of high-profile data breaches and creepy data brokers leave many consumers wary of organizations seeking their data.

Taking transparency beyond the checkbox

These problems are exacerbated by organizations mistaking disclosure for transparency, and assuming that pop-up notifications, cookie-based consent requests and arcane privacy policies are enough to win consumers’ trust.

A legalistic approach might satisfy regulators, but consumers won’t trawl through pages of small print to learn about data policies. Meaningful transparency starts with proactively offering clear explanations to key questions:

● What data are you collecting? Customers shouldn’t be surprised to learn you’ve collected their data. Get permission up front, and spell out the types of data you’re storing.

● How will you use the data? Don’t ask for a blank check – let consumers know how you’ll use their data, then use it only for purposes they’ve specifically approved.

● Who will you share the data with? Consumers deserve to understand where their data will travel, and which third-party services might access their information.

● When will you delete the data? Don’t keep data that has served its purpose. Transparency demands a commitment to deleting data that’s no longer needed.

Don’t bury the answers in hard-to-read privacy policies – make them accessible and easy to understand. New York requires data policies to be explained in 8th-grade English, and that’s a good place to start.

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It's time for innovation

When modern privacy rules were implemented, businesses rushed to build compliant infrastructure. Now it’s time to go beyond compliance and give consumers the transparent experiences they crave.

Transparency means different things for different companies. Some operators might create preference centers where users can easily control how their data is used. Others might let users generate reports documenting exactly how their data is collected and used.

And some organizations are already pioneering this approach. IKEA, for example, has won plaudits for giving customers agency over their web experience. If a consumer is happy trading their data for better product recommendations, IKEA makes that possible – and if they’d rather keep that data to themself, IKEA makes that just as easy.

Brands should similarly embrace bespoke strategies – underpinned by effective design, customer communication and data infrastructure – to deliver meaningful transparency.

Transparency is a superpower

Data transparency is a brand superpower. But with power comes responsibility. Consumers hate feeling duped, and as marketers have learned in areas such as sustainability, there’s little worse than getting caught acting in ways that contradict the organization’s professed values.

As more businesses give users control over their data, we’ll see similar patterns play out. Some brands will commit to data transparency and realize durable brand value. Others will get caught taking shortcuts, and their brands will suffer as a result.

So, for companies promoting data transparency as a brand value, be careful. Consumers are increasingly savvy about how their data is used and abused. The only way to drive lasting brand value is by leaning in, innovating – and putting real transparency front and center in the consumer experience.

Jon Suarez-Davis is strategic advisor at Ketch.

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