The individualization of society is continuing without pause. At the same time, the rapid pace of technological development is revolutionizing the relationship between customers and companies. These days, advertising can increasingly be tailored to individual customers. This brings with it many opportunities for marketing departments, but it also entails risks.
As a result of the constant direct and indirect communication between companies and customers, the knowledge that each has of the other is more transparent than ever before. Customers now compare and evaluate products and services and share their experiences with them very openly – offline in direct communication with others, or online on ratings platforms or social networks. Simultaneously, consumer preferences are becoming more and more easily discernible and well-defined, and they are therefore increasingly coming under the scrutiny of marketing departments. The motto in the development of products or services is: everything revolves around the customer experience. Concepts like “user experience” and “design for X” are indicative of a trend in which each individual customer is presented with personalized offers that are difficult to turn down.
The transparent customer
The foundation for this is the storage and analysis of interactions with customers. Tremendous quantities of data are now being collected and evaluated as part of what is known as “customer relationship management” (CRM). The results of the evaluations are used to formulate targeted multichannel marketing activities which, ideally, create a perfect balance between the benefit to the customer and the benefit to the company. And customers actually seem to voluntarily give up all the information that companies need for their targeted and personalized strategies. Both actively (via smartphone or social networks) and inactively (through various software protocols), consumers supply their preferences, desires, attitudes and views free of charge, as it were.
Cool or creepy?
So is all well in our digital Shangri-La? Not necessarily. Because often enough, the motto seems to be “anything goes” for the marketing departments, which are driven by a gold-rush mentality in their pursuit of data. All the tools of digital marketing are deployed, and customers are sometimes overwhelmed with personalized offers and advertising through interconnected channels. Many marketers go too far — and cross the “creepy” line. In other words, they cross the line at which customers start to feel as though they’re transparent. That’s clearly a highly unpleasant feeling. According to a study by Forrester Research, customers who have these experiences even describe their sensations as “creepy”. Forrester defines this feeling as the “discomfort that people feel when social norms are violated, or when they are present in areas where no social norms exist”. Bear in mind that what’s involved here isn’t illegal behavior that causes quantifiable damage. But there is a thin line between cool and creepy, between benefiting and disturbing the customer.
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If someone searches for shoes on the Internet, for example, and finds an unsolicited catalog from a shoe store in their inbox a few days later, without having given their email address, that can certainly put them ill at ease. According to the Forrester survey, these customers increasingly get the feeling they are being watched and spied on. Location-based analytics don’t always hit their mark, either: if you happen to be near a restaurant and suddenly get a personalized offer from it on your smartphone, without having ever visited the restaurant or even Googled it, you might not always feel appreciative.
There are many potential missteps that can be made in the area of data hygiene too. One example is when databases aren’t kept completely up-to-date. If a mail order gift company sends out advertising for Mother’s Day presents although the mother of the registered customer died years ago, that’s doesn’t make a good impression, to put it mildly. According to Forrester, however, what irks customers the most is grossly invasive or even aggressive marketing tactics like excessive retargeting: a customer who does an online search and then feels pursued by related advertising across various websites and devices will hardly have a positive impression of a seller. The damage to a company’s image can be considerable, because a mature, Internet-connected customer will naturally share these creepy experiences with other users online and offline. Bad experiences are in this way magnified and can significantly harm a company’s business.
So what’s an advertiser to do? Amidst all the potential courses of action, it’s important to keep a cool head. Put yourself in the customer’s shoes. Use data according to ethical guidelines. Marketing managers should always ask themselves what harm could arise and how it can be avoided. Transparency and good data hygiene are a must: ideally, customers will understand why they are receiving certain advertising. And it should be obvious, even without the GDPR, that the customer’s data must not only be handled responsibly but also be kept up-to-date. But rule number one for avoiding the “creepy” trap is this: companies should always listen to their customers when they object to something and change their behavior. That will earn them high marks from critical customers.
For more information, see: Katja Tiefenbacher and Sebastian Olbrich, Wie Big Data die Kundenbeziehungen beeinflusst – mit zusätzlichen Informationen zum Segmentierungs- zum Erlebnismanagement. In: Frank Keuper, Marc Schomann and Linda Isabell Sikora (ed.), “Homo Connectus – Einblicke in die Post-Solo-Ära des Kunden” (pp. 87-99). Springer Fachmedien, Wiesbaden 2018, 472 pages, 49.99 euro.