Digital transformation is fueling one of the biggest changes to the global business landscape since the industrial revolution more than 200 years ago.
There is no doubt as to why digital transformation has become such a phenomenon. Interactions, operations, and transactions have become easier and faster than ever for businesses and customers alike. What’s more, digital transformation can help companies provide far better services – by remembering user preferences, providing tailored recommendations, speeding up the purchase process, and much more.
While new data collection technology undoubtedly allows businesses to upgrade their services, there are still plenty of pitfalls to watch out for. Gaining customer trust offline is one thing but earning that same level of trust in the digital world requires a significant investment. This is especially important during the current COVID-19 outbreak as people are becoming increasingly reliant on digital channels at a time when opportunistic online scams are trying to take advantage of the situation..
Convenience must not come at the cost of security
Enhancing the customer experience is often the focal point of digital transformation efforts. While a better experience has proven to attract new customers and retain existing ones, businesses must take special care to ensure long-term sustainability.
Indeed, the same data collection that enables convenience can also generate angry customers and massive headaches if that data is not handled properly. Research shows that 84% of consumers prefer businesses that have a clean record for data security, and consider it to be the key deciding factor about where to make purchases. Businesses hungry for data would be well advised to take a lesson from that particular data point.
Ordinary people are becoming increasingly wary of data privacy, and many believe (correctly) that some companies actively misuse data. While governments are trying to crack down on unfettered personal data collection through legislation, businesses should also take it upon themselves to be good actors on this front.
Doing so means cooperating with not only the letter but also the spirit of such legislation. In Thailand, the Personal Data Protection Act (PDPA) will come into effect on May 27 of this year. The Act puts clear controls on how businesses can collect, store, and share your personal information. This new set of laws is intended to protect consumer data online, and keep them informed about how it is being used.
Companies should see this requirement as yet another reminder that respecting user privacy should be a top priority for companies looking to leave the right impression. Being fully transparent about data collection practices is not only a legal and ethical imperative – customers will notice and appreciate it, too.
Trust is earned, not given
If companies collect and store customer data, it is ultimately their responsibility to keep that information safe. Data breaches, hacks, leaks, as well as ransomware and malware attacks are all on the rise. Companies should spare no expense – in terms of both money and human capital – to build and maintain a robust security system.
Businesses must also inform their customers of exactly what they plan to do with the personal data they collect. They should provide this information voluntarily while making their practices and policies as clear as possible. At the very least, the following questions should be addressed:
- Who owns the data?
- What kind of data does the company collect?
- What kind of data is suitable for business use?
- What data can the company share with other parties?
- Who will the data be shared with?
By answering all of these questions freely, organizations can demonstrate their transparency.
Beyond data protection
In the digital age, data is the new oil. Yet if a company of any size was losing actual crude oil without explanation, it would be disastrous for its reputation and bottom line. The same is increasingly true with data. Companies in the modern era only deserve consumer trust if they treat data protection with the seriousness it deserves.
When used the right way, the use of personal data can make all sides happy. The customer has a better experience, and therefore is more likely to buy products and services again in the future. Keeping to this simple formula is the key to greater success in the marketplace – and it also happens to be the right thing to do.