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The Value of Personalized Marketing in a Privacy-First World

By: Veronica Horner


Data privacy and personalized marketing are not mutually exclusive. With the right approach, personalization can drive value and improve ROI. 

On Tuesday, October 20th, SEI partnered with IE university, Horizon Media, and TransUnion to co-host a digital event called People-based Marketing in a Privacy-first World. Panel speakers included Laura McElhinney and Liz Rowe of Horizon Media, Michael Cole from Wunderman Thompson Health, Matt Spiegel from TransUnion, and Joseph Sartre of Interlace Ventures. The panelists explored the evolving landscape of data privacy regulations and how these laws — paired with rising consumer concerns regarding data privacy — are reshaping modern marketing tactics.

In response to a rapidly-evolving data environment, marketers are increasingly recognizing the value of personalized, “people-based” approaches. The COVID-19 pandemic has meant that consumers are spending more time on screens and consuming media, and marketers are making greater use of micro-segmentation and hyper targeting to deliver more relevant, personalized messaging.  

At the same time, however, they are forced to grapple with a slew of challenges that seem at odds with the effective deployment of such tactics. These include regulatory changes, the expansive provenance of large digital platforms such as Google and Facebook, and increased consumer awareness — and expectations — regarding data privacy.  

Today, companies across industries have significant stores of data at their disposal, but are unsure of how to translate this information into powerful, personalized marketing tactics that improve the customer journey. To do so successfully, companies need the right tools and organizational structure to maximize the benefits of tech-driven personalization. 

How Marketing Is Adapting to Data Privacy 

Marketing strategies and objectives have not fundamentally changed — but the tactics to achieving those goals have. Overall, marketers still focus on reaching the right person at the right time, and with the right message. In this respect, data privacy and personalization are not at odds. Marketers can build trust with the consumer by enabling them to personalize the degree of data privacy they prefer.  

To retain customers and expand marketing efforts going forward, we recommend the following: 

  • Know the customer. Use every applicable tool to get to know the customer more intimately and gather real-time feedback. With this information, act quickly based on insights into consumer preferences and expectations. 
  • Build the foundations for AI and machine learning. Automate customer-preferences for privacy and data delivery, and create micro-targeted, hyper-focused segments for new marketing initiatives. 
  • Engage a partner. Don’t be afraid to work with a third-party agency, who can help transform data into powerful personalization tactics. 

The Importance of a Personalized Approach 

As marketing moves away from mass-appeal approaches, it’s become apparent that targeted marketing is more efficient and drives greater ROI. By leveraging the data they collect, marketers can understand who their target consumers are and their preferences — data privacy is an extension of this practice and can set companies apart from less adept competitors. 

Recent laws and regulations concerning data sharing and data privacy have outlined who marketers can target and with what types of content. However, many companies have failed to effectively demonstrated to consumers the value they gain by opting into data collection. Instead of trying to obscure their objectives, marketers can instead educate consumers on the value of sharing their data: when they share personal information, they allow brands to tailor messages to their unique interests and needs and serve content more likely to add value to their lives. As consumers become increasingly discerning about data use and management, companies should engage in the following important conversations with their customers:   

  • Education: “This is what we’re doing to safeguard your privacy.” 
  • Engagement: “What would you like us to do about privacy? What do you expect in exchange for your data — and what would make data sharing worth your while?” 
  • Feedback: “Are we living up to your expectations? What can we do better?”

After engaging their customers in such conversations, companies must take a holistic approach to improving data privacy that addresses organizational, administrative, and technical changes. 

Unpacking the Value of First-, Second-, and Third-Party Data 

In order to execute on targeted marketing initiatives effectively, organizations need to have reliable, accurate data sets. These data sets may consist of information from first-, second-, and third-party sources. 

Marketers should leverage as much of their own data as they possibly can. Use first-party data to build the consumer profiles that enable more effective targeting. Second-party data can be just as useful when validated, and although the use of third-party data is dwindling due to more stringent regulatory requirements, it can still be valuable if proven to be both accurate and reliable. 

Eventually, every company — unless they are data-consuming giants like Amazon, Google, or Facebook — will need to collect data beyond first-party sources. To scale, marketers should build out a reliable data pipeline. The key is to have specific campaign objectives, and figure out where to source accurate, reliable data to support those objectives. 

Most importantly, every organization should have a robust data strategy. Begin by determining what first-party data the company already has — this way, it’s easier to identify gaps and build pipelines efficiently. Smaller or newer companies may be at an advantage because they can flesh out operational strategies by putting data at the center of customer service, marketing, business, and product development functions. However, every company should develop a roadmap for addressing the gaps in their information ecosystems — and avoid falling victim to the myth that second- and third-party data is inherently less reliable than first-party data. 

Taking a Proactive Stance in Anticipation of Regulatory Changes

Ultimately, a key determining factor will be whether GDPR-type federal regulations are passed in North America. Currently, U.S. states are adopting their own sets of regulations, but federal-level data privacy legislation is likely to be passed in the near future. 

Regardless of if or when new regulatory frameworks arrive, companies need to be proactive about honing a personalized approach to marketing that prioritizes transparency, privacy, and trustworthiness. By making organizational adjustments, communicating openly with consumers, and applying machine learning capabilities to processing consumer behaviors, companies can achieve ongoing compliance while generating value through powerful marketing. 

At SEI, we’re more than consultants. We’re a team of highly skilled technologists, advisors, solution architects, strategists, project managers, and change agents with experience across sectors and technical domains. With three decades of proven experience in elevating the sales and marketing strategies, the data privacy stances, and the information security of clients across sectors, we are prepared to help any organization achieve — and even surpass — their desired goals. 

Get in touch with us today to learn more about what makes us different.

Veronica Horner


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