News

Guest Blogger

By Paul Carse, CTO, FirstHomeCoach

Big Tech creates a climate of distrust

In an era of Big Tech harvesting people’s data for their own gain, consumer suspicion around how companies such as Google, Amazon and Facebook are using their personal information continues to grow.

Recent research conducted by Dentsu Aegis Network and Oxford Economic found that globally:

Eight in 10 people would stop doing business with an organisation that misused their data.

– 44% of people have taken steps to reduce the amount of data they share online.

– 58% of people don’t believe enough is being done to ensure digital technology benefits everyone in society.

– This news is perhaps not surprising. Yet we still see too many technology businesses taking data they don’t need from their customers.

Most companies invariably need to ask their customers for key data in order to be able to provide them with a service. However, many of them squeeze in other questions to acquire customer data to serve their own ends, such as building their own analytics or to sell information to advertisers.

Ruthless transparency to garner customer loyalty

Rather than looking to harvest data, companies must be ruthlessly transparent – thereby driving consumer trust, rewarding the business and ultimately building brand loyalty.

In our case, with FirstHomeCoach, our mission is to make it cheaper, easier and less stressful to get on the property ladder, by guiding people through the complex process of buying a home.

In order to help these prospective buyers, we need to ask them to share personal information – gsuch as their salary, credit score and savings. We must, therefore, show users that the data we collect is only being used to tangibly benefit them. Part of our goal is to recommend services that fit people’s needs, not share or sell their personal data to others. We call this building digital trust.

How to build digital trust?

As the new research demonstrates, technology firms need to engage with this question more and more if they want to win and retain customers. Tech organisations can help establish digital trust in three key ways:

1) Explaining to people why they are asking them for the data they ask for.

Companies need to ask people for their personal information to be able to help them. But they must challenge themselves to be completely transparent and only ask for data if they have a use for it. Any request for data must be verified with an open explanation as to exactly why it is required.

In our case, we only ask people for their date of birth because some savings products – such as Lifetime ISAs – have an age limit on them. We ask for their salary so that we can input that information into our calculators to tell them how much they can borrow, or how long it will take them to save the deposit size they need. In each instance of data harvesting, there is a tangible benefit to the customer and this is transparently explained.

2) Creating a transparent business model that doesn’t sell user data or advertise to generate revenue.

Many businesses are not open about the fact that they monetise their products through commissions. There is nothing wrong with monetising products through commissions or introductions to products and services per se, and indeed it forms the basis of the business model for many small ventures. But the key is ensuring these companies are absolutely transparent with their customers around how that company is making its money.

Companies must explain how they make money from introductions, and also explain why they have chosen those specific products and services, and how they are relevant to their customers.

By doing so, companies can begin to challenge the status quo of the murky world of affiliate commissions with its profound lack of transparency around revenue generation.

3) Using micro-education to bring people along on their journey and give them the right information, at the right time, in the right way

People like to educate themselves about complex subjects in different ways. Some choose to read detailed articles, but this approach doesn’t work for everyone.

In order to give customers a personalised experience, they will need to ask them relevant questions – and this can be used as an opportunity to provide them with brief explanations about the service being provided. In our case, for example, we can provide information along the way about the particular stage of the home buying process they are in exactly when they need it.

What does the future look like?

As consumers, we expect companies to be open about how they make money and use our data, however, most businesses are still reluctant to follow this approach fearing for their bottom line.

We believe that being open and transparent with our customers is the right thing to do, and we’re confident that this will lead them to reward us with their loyalty.