Tuesday 2¢: Customer Data is Currency and You are the Bank

Welcome to the Tuesday 2¢. It’s Tuesday, the weekend is a distant memory and it’s time to let off some steam and give our 2 cents on a hot industry topic. This week Ian Truscott considers the hot topic of data protection, emphasizing that it must be taken seriously in order to be mutually beneficial to those parties involved.

The empowering nature of information has been well documented. Commonly attributed to Sir Francis Bacon in the 16th century, the phrase “knowledge is power” has never been so relevant as it is today, with the contemporary debate about online consumer information and data protection.

Knowledge about a consumer is indeed powerful, but it is also valuable when treated fairly by both parties. As a consumer you won’t receive the personalized service or loyalty rewards you’re looking for, without sharing a little data.

However, the ownership of this data and the way in which it is managed is changing, and while it might all seem slightly dull for an industry which prefers to focus on creativity and making pretty things, as marketers we have to take this thing seriously.

Evidence of this could be seen in the news last week which focused on the EU Open Banking legislation which came into force on 13 January and gives bank customers the right to allow businesses, other than their bank, access to their financial data.

On top of upcoming GDPR regulations, this is another sign of the shift toward the consumer regarding the ownership of the data which organizations hold about them. This quotation from the European Data Protection Supervisor (Opinion 4/2017) demonstrates the mood of our legislators:

This isn’t just a local European issue. Legislation in Europe impacts any organization which operates in Europe, according to analyst Tim Walters from Digital Clarity Group:

And of course, it is not something which is merely on the mind of Europeans. There is a growing global concern as data privacy is the zeitgeist amongst all consumers.

As I’ve mentioned before, GDPR can be seen as an opportunity. But, from an information management perspective, it has a huge impact on organizations due to the need to make this information easily available, open and yet secure.

In a curious symmetry with the news of Open Banking last week, I’ve been thinking of this business challenge like banking. When a consumer deposits their data with our organization, they need to trust that it won’t be lost and they deposit it with a view to gaining something in return. Much like in banking, therefore, the consumer requires a statement which shows how much of their data you have, what benefit they have earned and a confirmation that they can withdraw it anytime.

With virtual assistants listening to our every word, the prospect of body implants not far over the horizon, and the view that elections can be decided with social targeting, thinking of data as something as precious as currency is not so far-fetched.

Perhaps our stewardship of that data will become part of our brand promise. Before we are trusted with a deposit of data, we will need to demonstrate trust, like a bank. And, like banking, I cannot imagine that Open Banking and GDPR will be the end of the legislation surrounding these transactions.

So our information systems will need to keep up, but how many organizations are currently equipped to do this? Today, consumer data sits in multiple departments and silo’d systems. Tomorrow, however, the “single customer view” will no longer just be a ‘nice to have’ marketers dream of nirvana as part of a forward-looking customer experience program, but an expectation from the consumer and protected by law.

Customer data is currency and you are the bank.