Adam Naide, head of social media marketing at Cox Communications, recently posed this question to my students: “Would you want to be friends with your cable company?” On the surface, why in the world would anyone want to be “friends” (on social media) with his or her cable provider? According to a 2014 report from American Customer Satisfaction Index, subscription TV and Internet service providers are among the poorest performing industries tracked by the index.
Despite this, students indicated that they would want to be friends with their cable company and connect with it in the digital space. Why? Some students saw it as an efficient method when seeking customer service. Others wanted to be alerted about new content that was becoming available. Whatever the reason, it came down to individuals identifying a benefit to connecting with their cable provider online. In the digital space, this means sharing information about yourself with another party.
Communications and offerings can be customized based on what businesses know about consumers. When new seasons of HBO’s original series like The Newsroom and Game of Thrones are about to premier, for instance, consumers who have made it known that they are fans of the program, whether through their viewing habits or social media activity, may welcome promotions that incorporate content related to these programs. But current HBO subscribers and lapsed subscribers shouldn’t receive the same promotions. While current subscribers might appreciate reminders about how to catch up on past seasons of their favorite programs, lapsed subscribers could be tempted to resubscribe with promotional offers that have been customized based on their interests.
In a recent survey conducted with Bain & Company (discussed in greater detail in my book, Profiting from the Data Economy), we investigated the preferences consumers have with respect to sharing different facets of their online behavior with businesses. Consumers were less guarded about data such as comments on social media platforms, browsing behavior and online purchases. Such information is what businesses need to deliver value to consumers in exchange for personal data. Consumers were more guarded when it comes to sharing contacts, both personal contacts and those gleaned from social networks. (Coincidentally, it is app developers’ access to users’ social network contacts that Facebook has recently announced it plans to limit by giving users control over the data they share.)
In a recent New York Times op-ed, University of Maryland law professor Frank Pasquale discussed the “dark market for personal data.” As he points out, the collection of data online is not heavily regulated and often lacks any semblance of transparency. This can and should give rise to concerns about consumer privacy, as well as about how the inferences drawn from collected data are put to use by businesses.
But these concerns need to be weighed against the benefits that consumers can potentially reap from voluntarily sharing information with businesses.
For businesses, this means actively making the case to consumers to be less guarded with their data. Do you want to know what brands they like, which celebrities they follow, what television programs they binge-watch, and where they spend time in your retail store? If so, businesses need to deliver value to consumers in exchange for this information, whether that takes the form of targeted financial offers or engaging content. When consumers can identify the benefits of sharing their information with businesses, they’re open to forming that relationship.
If businesses don’t consider what consumers have to gain from the relationship, then businesses risk being “voyeurs” who snoop on consumers rather than serving as a platform to actively engage consumers.