Why The Customer Experience Now Starts At The Data Layer — Not The Transaction Layer

The following post was written and/or published as a collaboration between Benzinga’s in-house sponsored content team and a financial partner of Benzinga.

Consumers and companies alike are concerned about data privacy. Last week, McDonald’s MCD reported that customer and employee information was leaked due to a data security breach. The breach impacted the company’s markets in Taiwan, South Korea, and the United States. A simple food transaction made these consumers vulnerable to stolen or exploited data. As companies become more dependent on digital processes, tools, and information systems, we have discovered that data security is sorely lacking.

Data breaches affect more than the bottom line. They affect customer experience and can be the determining factor of whether or not a consumer returns to your company. Customer experience has always been tied to purchasing power. This is why customer service is such an essential part of any business strategy. But the focus is shifting in our increasingly digital world. 

According to a 2019 study from Pew Research Center, 72% of Americans believe that companies, tech firms, and advertisers are tracking almost all that consumers do online or while on their phones. The same study showed that most Americans (81%) believe that the risks associated with this form of data collection far outweigh the benefits. Consumers are concerned about companies using their data, but those same companies have done nothing to counter consumers’ distrust.

ATB Ventures, the innovation arm of ATB Financial, recently released a report about the state of consumer trust in the tech sector. Through their findings, the company determined that organizations of the future will be defined by their ability to prioritize consumer trust. With data pulled from more than 1,000 tech professionals in North America, ATB Ventures created a template by which technology companies can understand trust. The template is called “The Trust Stack” and it breaks down past, present, and future initiatives toward consumer trust.

Tech’s Trust Deficit 

ATB Ventures’ study found that 62% of North Americans are concerned about the safety of their data. Understandably so, when consumers hear news of data breaches on a weekly basis. But the same study found that only 9% of respondents believe they have enough information to understand the world of data privacy.

This raises a unique challenge for tech companies: they will need to educate consumers about data security issues while also creating solutions for those problems. Consumers need to understand, from the beginning, that the company has strategies in place to combat common data privacy issues. This goes as far as educating consumers about bias in AI and algorithms. In order to generate trust, the consumer needs to understand that the company is providing a solution to a significant problem. 

Convenience That Doesn’t Cost Privacy

To be clear, many data security issues have come out of initiatives to offer consumers greater personalization and convenience. Whether that’s personal information stored in a cloud-based service or preferences observed through third-party data so companies can offer precise recommendations, convenience is the underlying theme. A straightforward and, perhaps, simplistic solution to data privacy concerns would be to encourage customers not to share their information at all.

But this isn’t what consumers want. ATB Ventures’ study found that 37% of respondents don’t understand why they would have to sacrifice convenience in order to take back their privacy. And they have a point.

In the eyes of the consumer, the burden of privacy rests on the companies they interact with. They still, however, want those companies to use their information to provide modern conveniences. 

This Catch-22 for organizations can only be remedied with an integrative approach to generating consumer trust.

A Trust-Based Consumer Experience

The ATB Ventures Trust Stack accounts for every tier of a company’s tech stack. Consumer trust is the thread that ties each piece together. The measure of success for tech organizations will be whether or not the consumer is at the center of the overall strategy. Each tier of the stack contributes to this overarching goal, bridging the gap between a convenient consumer experience and protected consumer data. 

But when a company’s only goal is profit, privacy is the first thing sacrificed in favor of convenience.

“Convenience and privacy are opposing forces by way of profit—not technology,” said Chandra Rink, Director (Product Innovation & Strategy), ATB Ventures. 

Tech stacks developed under the guidelines of the ATB Ventures Trust Stack will make it possible for companies to hold both convenience and privacy at the same time. These two priorities will not require the sacrifice of profit—instead, they will sustain it. The future of the customer experience relies on an organization’s ability to prioritize trust, and this strategic Trust Stack makes that possible.

63% of people say they are more likely to direct their business toward organizations that prioritize data security. This competitive differentiator will define the future of the tech world. Customers will be drawn to companies that are clear about data security measures. Providing convenience without sacrificing security is the way to win over consumers and turn them into customers.

For more about the ATB Ventures Trust Stack and research, you can read the entire report.

Disclaimer: The writer does not have any business relationship with the companies and research mentioned in this article.

Image by Free-Photos from Pixabay

The preceding post was written and/or published as a collaboration between Benzinga’s in-house sponsored content team and a financial partner of Benzinga. Although the piece is not and should not be construed as editorial content, the sponsored content team works to ensure that any and all information contained within is true and accurate to the best of their knowledge and research. This content is for informational purposes only and not intended to be investing advice.