Customers who give us their data: the ROI of the social enterprise

Fernando Polo

15 July 2014

For what reason should a company be given access to information about what we say, what we do, and what we like on Facebook, Twitter and any other social platforms? Can we trust that they will make good use of our behavioral data, while knowing that, with our written and declared information, companies can get to know more about our personalities than even we do?

In the near future, social enterprises will win the trust of their customers, and gain a huge competitive advantage, as they will be willingly allowed access to social data. Years ago, Seth Godin coined the term “permission marketing” which explains that companies should seek permission before sending out marketing communications.

Ten years later, and it now goes far beyond getting an email. At Territorio creativo, we believe that the companies that are truly committed to their customers, in this era of the overabundance of data, must go beyond the idea of permission, in order understand that the challenge is to gain the right to have at their disposal, and handle customer data. Unlike the old permits (“I authorize you to send me offers”), the new data process is much more invisible; it is based on complex algorithms associated with the behavior of others with whom customers have relationships. This thus leads to a previously unseen level of intimacy.

Long ago, we stated in “Cinco Dias” that the next digital divide would be found in the mass analysis of data (i.e. the time-worn “big data”Article in Spanish). Companies that do not develop these capabilities cannot compete with those able to profoundly know their customers, and their dynamics of change (for example, in the case of Netflix (Article in Spanish), when deciding what series to produce). Also, these sorts of companies do not learn to sophisticate their segmentations, which would enable them to supply targets with the best offers, and to improve all indicators – both pure business performance (conversion rates, for example) and traditional financial indicators.

The power of data generates an ambivalent sensation – as one of our clients said amidst an explanation about the potential of Social CRM – because, though on the one hand, the ability to resolve and anticipate problems, and customize services and offers, creates wonderful possibilities; on the other, it causes anxiety that companies (and governments) are able to know things about you that you only share with those you trust deeply. In order to, both avoid rejection, and the excessive regulatory pressure to build loyalty and trust, we must show that we will use the data and its conclusions in the careful and discreet manner more synonymous with a trusted family member than with a regular friend.

It was often said, at the start of the 21st century, that the “social enterprise” and “committed brands” will be the predominant model of the future, where consumption will not grow as it did before, and consumers and citizens, digitally empowered, are becoming increasingly aware that companies must work to create shared value with society.

In the near future, one of the most obvious reasons for a company to migrate into the social enterprise model will be to gain the trust of its customers, and that they, in turn, yield their data for exploitation. For any Social CRM (Article in Spanish) or Social Loyalty strategy, the transfer of data is the starting point. Honesty and transparency are values ​​that go beyond reputation. With my openness and honesty, I generate trust, and in return, I get the right to use my clients’ data.

And now, does it make sense to continue making CSR (Article in Spanish) a mere affectation?