Trends and Outliers

Balancing Data Discovery and Customer Privacy

The fact is more companies are using customer data to better understand their customers’ needs and preferences as well as to provide those customers with more targeted, personalized offers.

And that means business leaders must be careful to ensure that their organizations don’t overstep their bounds when it comes to customer privacy.

There are several reasons business leaders need to strike a balance between using data analysis and data discovery to identify the customers and prospects they want to target and customer privacy.

TechTarget’s Nicole Laskowski reminds us of a New York Times article about Target identifying potentially pregnant customers.

In the days that followed that article, the retailer was slammed for being “Orwellian” and “creepy,” in part, because Target knew that at least one young woman was pregnant before her father found out.

The rapid advancement of intelligent sensors, including those that are embedded in smartphones, is also making it possible for companies to use geo-fencing techniques to track a person’s whereabouts and provide him with offers.

Starbucks is frequently cited as an example of a company that sends its customers geo-targeted text messages and offers if they happen to be passing near one of its outlets.

While some consumers may feel like Big Brother is watching them when they receive location-based offers, a growing number of customers seem to be more comfortable receiving offers on their smartphones. According to Juniper Research, more than 3.4 billion mobile coupons were redeemed on a global scale in 2011 .

Of course, companies need to address data privacy to meet increasingly stringent regulatory requirements. This is especially true in the European Union, which is continuing to reform data protection rules.

There are some concrete steps that companies can take to balance the use of data analysis and data discovery – when applied to customer information – with consumer privacy.

For instance, some companies such as the National Australia Bank and Cartier have established data usage policies that they communicate to their customers and others in the public domain.

Companies can and should also invest more resources in data education, both for consumers and employees, regarding how they’re using consumer data and the rights that consumers have when it comes to the use of personal and financial information.

European data protection agencies have asked Google to modify its global privacy policy that encompasses dozens of the the company’s online services, including its flagship search engine, Android mobile phone apps, and YouTube videos.

The EU agencies want consumers to have a clearer understanding about what personal information is being collected and to better control how that information is being shared with advertisers.

As companies look to coalesce data analysis and data discovery with privacy protection, it’s also important for them to carefully assign and monitor which employees and managers have access to certain types of consumer information.

Doing so can help companies minimize the risk of data breaches to consumers, business partners, and shareholders and also help strengthen customers’ trust in how their information is being handled.

Next Steps:

• Subscribe to our blog to stay up to date on the latest insights and trends in data analysis and data discovery.
• Please join us tomorrow at 1 p.m. EST for our complimentary webcast, “TIBCO Spotfire Delivers Game-Changer – Brings The Power Of Discovery To Big Data,” presented by Lou Jordano, Director of Product Marketing, TIBCO Spotfire. In this webcast we will demonstrate the generally available version of Spotfire 5, the next generation of data discovery and business analytics, offering breakthrough capabilities to speed analysis of big data.

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