How to safeguard trust in the digital age

Data analytics, AI, and other tools of the digital age can help organisations improve customer experience, but they may also raise concerns about data usage and privacy.

Advanced technologies that gather and apply customer data can be significant differentiators for an organisation – and their use is becoming ubiquitous. Social media sites grant consumers “free” usage of services and, in return, give advertisers access to users’ personal information and activity. Grocery stores hand out customer discount cards to capture and leverage purchase history, often in partnership with outside vendors. Online retailers use and sometimes sell data to build predictive recommendation engines for shoppers. In an era of connected technology and big data, companies have powerful tools to personalise marketing and improve the customer experience (CX).

Yet with great power comes great responsibility. Companies are expected to be trusted stewards of consumers’ information, accessing, using, and storing their data in a manner that maintains – and builds – trust with the customer. Similarly, organisations have a responsibility to use advanced technologies such as AI in a way that supports the mission of the organisation and enhances its relationship with consumers. Indeed, fostering trust is a top marketing trend for this year, according to Deloitte’s 2020 Global Marketing Trends.

Big Data Needs Big Trust

As companies collect more customer data and leverage that data through increasingly sophisticated AI technologies, they face complex choices about how to handle the information they gather. Deloitte’s 2019 Global Consumer Pulsing Survey in the United States, United Kingdom, China, and Brazil shows that consumers have a strong aversion to companies profiting from the sale of their data – even as many are unaware of how pervasive the practice is. Among 4,000 global consumers surveyed, 53% said they would never use a company’s products if the company were selling consumer data for profit, while 40% believed none of an organisation’s profits should be derived from selling data. However, 27% of respondents acknowledged that they never consider how a company uses their data while they are making purchase decisions. (Conversely, 19% always consider company data usage.)

Transparency about how an organisation uses customer data can benefit companies and consumers alike. In one study, 86% of surveyed customers indicate they would be more likely to trust companies with their information if they knew how it provided a better CX. The takeaway: It’s increasingly important to get messaging right when communicating how data and AI strategies provide a fair exchange of value for customers.

Align Data Policies to Purpose

Organisations looking to foster trust with consumers can begin by ensuring that data capture and usage align with the core company mission – and by extension, support the brand’s relationship with the customer. As more data protection and privacy regulations emerge – such as the General Data Protection Regulation (GDPR) in Europe and the California Consumer Privacy Act in the United States – companies have an opportunity to build public trust by proactively reviewing their own consumer data processes.

Data policies become even more complicated when organisations acquire data from second- and third-party vendors. In these cases, it can be difficult to fully understand how data was acquired and what customers know about how that data would be used. Nonetheless, it’s important to consider what consumers would expect from those possessing their data and ensure data is managed in a way that is congruent with the company’s purpose.

Build Toward Trusted AI

With data as the foundation, many organisations are leveraging AI to identify and segment audiences, optimise performance, and create a better CX. Yet using AI for these purposes raises two concerns. One is that human bias can lead to flawed methodology assumptions, biased data for training models, or incorrect interpretations of outputs. Another concern relates to transparency: Because AI uses complex modelling that progressively improves without human intervention, it can be difficult to sufficiently explain the methodology when seeking consumer consent.

Regulations like the GDPR incorporate clauses about the use of AI, such as the need to explain to consumers the logic behind automated decision-making. In addition, organisations might consider the following measures to maintain consumer trust regarding AI practices:

• Partner in developing an AI strategy.

As AI trust issues escalate, new institutions are forming to help businesses with best practices. For instance, the Algorithmic Justice League partnered with the Center on Privacy and Technology to launch the Safe Face Pledge. Organisations can use this platform to publicly commit to not abusing facial analysis technology. Further, the league offers to assess code to minimise the opportunity for bias and provides instruction on inclusive algorithmic design.

• Design for relevance, not personalisation. Sometimes, special incentives that are meant to be personal can feel invasive. Take, for example, the use of algorithms that infer a woman is pregnant based on web search or purchase history, then serve targeted ad offers. Instead, organisations can pivot algorithms to provide relevant recommendations based on circumstance, not personal history – say, by offering an umbrella on a rainy day rather than an umbrella after someone buys a raincoat.

• Explain how consumers benefit. Companies can demonstrate how AI leads to better innovation and, therefore, better experiences for the customer. For instance, Amazon gleans insights from its purchase data to better build its supplier network to match consumer demand. Notably, this data is used at an aggregate rather than at an individual level.

As the use of data analytics and AI continues to expand, so does their potential impact on trust. Companies are likely to feel increasing pressure to show they are good stewards of customer data. In this light, they could do well to build a high level of trust with stakeholders by proactively and transparently demonstrating good behaviour.