How responsible use of data improves the customer experience, drives business and customer loyalty.
Think about your local supermarket’s rewards program. You probably have a card you scan at the register to earn rewards points for every transaction you make at the store, which you might use for a variety of perks such as discounts, free gasoline or free grocery or prescription drug delivery. You might also get coupons when you check out based on items you recently bought, helping you to save money on your next visit.
All of these perks are examples of how businesses build trust and improve the overall customer experience. Though supermarkets and pharmacies are the most common examples, retail stores, restaurants, coffee shops, movie theaters, and so many other types of businesses rely on rewards programs, coupons and discounts, and other similar perks to attract and retain customers. According to a recent Accenture survey, more than 90 percent of companies employed some form of customer engagement or loyalty program.
And these programs aren’t important for just the businesses, but for consumers as well: in 2019, consumers had an average of 14.8 memberships in loyalty programs. According to a survey from Criteo, 65 percent of consumers report that they enjoy loyalty programs, and 52 percent say that loyalty programs are one key reason they choose specific retailers or brands. And consumers value incentives beyond just the loyalty programs – Criteo also reports that 93 percent of U.S. shoppers cite discounts and offers as important factors when deciding whether or not to purchase from a retailer or brand. All of these are critical to the overall customer experience, which consumers expect to be increasingly personalized. 80 percent of consumers want personalization from retailers, including in their loyalty programs: 72 percent of consumers expect loyalty programs to offer personalized rewards.
To offer these perks successfully, businesses use data to predict the benefits that will appeal to their customers and tailor their programs to these interests. This allows customers to have a more relevant and enjoyable experience with the brands they choose to purchase goods and services from and enables businesses to build, grow and maintain a loyal customer base. Also critical to building trust among customers is transparency: 61 percent of consumers report they’re at least somewhat willing to share personal information with an app in exchange for more transparency and control over their data.
Frankly – this exchange is a win-win for everyone, and it’s an excellent example of how the responsible use of data brings tremendous benefits to consumers and businesses.
As lawmakers consider a national data privacy law to protect consumers, they must consider how they can preserve this type of responsible data use that both consumers and businesses have come to rely on as they navigate the U.S. marketplace while promoting transparency and accountability that is key for consumer trust.
We believe it is possible for consumers to be protected from bad actors who want to use their data in harmful ways while still receiving the benefits of promotions, coupons, discounts and loyalty programs from their favorite brands. The Privacy for America approach would prohibit harmful data practices while preserving the ability for businesses who use data responsibility to continue to provide these benefits their customers have come to appreciate and expect. It would also impose a series of requirements designed to enhance accountability, transparency, and consumer control with respect to personal data, which includes allowing consumers to opt out of any personalized information about products or services that they don’t want.
Learn more about how our approach to a federal data privacy bill would work for consumers, businesses and the entire U.S. marketplace: https://www.privacyforamerica.com/overview/