Alongside the increasing dominance of mobile, is lower consumer trust in how data is used by brands – It’s time for marketers to shift mindsets and processes from a data-first strategy to a choice-first one argues Ogury’s Niall Hogan.

The digital economy of today owes a lot to the rise of mobile as a platform. Equally, to the mountains of user data that are used to inform everything from user experience to predicting the latest trends. But the runaway success of major tech brands like Uber and Airbnb can only in part be explained by these advances.

The backbone of our digital economy fundamentally relies on user trust.

An Economy Fueled by Trust

Twenty years ago, you might have struggled to find many people who would happily choose to stay in the home of a complete stranger over a hotel. Similarly, how many of us would have felt comfortable paying or receiving our hard-earned money through a mobile phone? Yet today, as mobile banking customers, we’re confident doing just that.

Next year, the number of people using their phones for banking is predicted to exceed two billion. And there are now on average more than two million people staying in an Airbnb property every night.

So what’s changed? Convenience alone cannot explain this level of mainstream user adoption. Never mind our willingness to hand over bank details to companies that are often barely a decade old. The difference is confidence born of trust. We have been empowered by the fact that these providers not only promise a great service. They deliver on it too.

The big winners from this approach are the organizations that have put consumer trust front and center of their business strategy. Trust has become the most valuable currency in the digital economy. But unfortunately, not every corner of this economy has yet been brought up to speed.

Digital Marketing; A Long Road Ahead

In the wake of this new age of trust and transparency, digital marketing is trailing far behind.

Its foundations have been built on opaque, deceptive business practices, and questionable consent from users. As a result, marketers have more often than not been left with no choice but to rely on bad or ‘toxic data’, inevitably leading to rogue marketing.

Consumers today are more data savvy than ever before. They recognize that their data is coveted and used by organizations to target them with advertising. And that there’s value in trusting their data with organizations online in return for free access to content.

But over the last 18 months, this consumer trust has been tested. High profile data scandals have hit the headlines. Some of the biggest household names in technology and business have been tarnished for the way they knowingly or unknowingly use black hat methods to obtain and use consumer data for marketing purposes. Marriott Hotels and British Airways are just two examples. But even these two were dwarfed by the $5bn fine handed out to Google by the FTC.

The net result of this constant drip feed of negative stories is that consumers are understandably cynical over how their data is taken and used by digital marketers.

And what’s more, even with all of this questionable data collection in place, the business results are far from what we’ve come to expect.

Time’s up For The ‘Data-Driven’ Era

Since the dawn of our industry, ‘data-driven’ is a catchphrase that marketers know all too well. We’ve been led to believe that by collecting more data and using more sophisticated targeting we will be able to serve our users more personalized ads.

On paper, it sounds like a natural conclusion. The more data we input, the more we learn about our customers. And by serving them ads that speak to their interests, finally we can deliver more of what they love.

The only problem? It’s not working out that way.

Despite years of innovation on the technology front, and a bloated ecosystem of over 7,000 martech solutions all promising to provide all the answers, mobile users are still turned off by the ads they are shown.

According to our own research of 287,000 consumers across the USA, UK, Germany, France, Italy, and Spain, 90% of consumers today say that they find mobile ads annoying. Incredible really, that the net result of the $165 billion spent by marketers on mobile ads this year is that nine out of ten users are left irritated by the ads they are shown.

Something’s clearly not right here. More data and more tech are not the answer.

Transparency is the Solution

Here’s the good news – the vast majority (71%) of consumers are happy to share their data (websites visited, apps used, email address) as a means of accessing content for free. So the opportunity exists for a genuine ‘win-win’ scenario here, as long as this value exchange between consumers and users is communicated clearly and honestly.

And this is the element that’s currently missing.

Unless we can provide our users with a clear choice – to share data or not, to receive ads or not – they will always carry an underlying resentment towards the ads they are shown. No matter how relevant these ads may be to their interests, they will act as a constant reminder that their data has been hijacked, without their permission, to make money for other companies.

It’s time for the industry to move on from ‘data-driven’ and embrace a new mantra – ‘choice-first’. When it comes to their data privacy, we owe it to consumers to offer them a fair choice. Specifically, as brands and publishers, we need to offer users three distinct options:

  1. Pay for a subscription that allows consumers to access content without ads and without having their data tracked.
  2. Agree to have their data collected in exchange for a more personalized experience, including targeted advertising.
  3. Opt-out from sharing personal data but receive more irrelevant ads and possibly damage the user experience.

For brands looking to reach their ideal customers through mobile, focusing on asking permission from consumers will not only result in more compliant data. It will also evolve the relationship between consumers and brands to one of mutual understanding and trust.

For publishers, it means delivering ads that start to feel more like personalized recommendations from recognized companies. And when users see ad content from brands they know and love, engagement and retention skyrocket.

With GDPR and other privacy legislation now in place, we’re all aware that obtaining consent (and offering a clear way to opt-out) is a legal requirement. But this is just the start. The onus is now on us as an industry to go a step beyond this minimum requirement, to ensure that this consent has be obtained transparently, in a way that informs consumers over their data choices.

Organizations that answer this call and put consumer choice and data privacy at the center of their strategy will outperform their peers in the long run.

Mobile users have shared their feelings. Now it’s on us to show that we’re listening.

 

This opinion piece was contributed by member Niall Hogan, Managing Director of Southeast Asia, Ogury and originally published on Warc.