The Consumer Data Value Exchange Building better terms of engagement for data (and why the future of brands depends on it) Data is becoming the fundamental currency in brand-consumer relationships, and yet it is a currency that only one party in the transaction fully understands. For marketers looking to unlock future customer value and build stronger customer loyalty, lack of data understanding on the part of their audience is becoming a critical challenge. In The Consumer Data Value Exchange, a groundbreaking study into consumer attitudes towards data sharing, Microsoft partnered with The Future Laboratory and Sentient Decision Science to uncover what consumers are truly willing to share, and how they feel about doing so. Using innovative techniques to probe both automatic System 1 responses and conceptual System 2 understanding of data, we looked beyond the debates around privacy concerns that have dominated research in this area to date. The result is a wholly new set of insights as to how consumers really perceive brands’ use of data, how those perceptions shape their daily responses in the digital environment, and why the challenge for brands is not just persuading consumers to share their data – but demonstrating why it is in their interests to do so. Among the key findings to emerge from the study are: • Consumer perceptions of data as personal information mean they struggle to understand how it can be used to their benefit. Incentivizing consumers to share data, as many brands currently do, can be an easy way to encourage data sharing, but moving beyond transactional benefits can be an easier way to sustain proactive sharing. • Globally, people prefer cash, followed by discounts and loyalty points. When taking into account implicit and explicit tradeoffs, 89% would take discounts, but 63% would also share to remove steps (e.g. automatic logins). • * The Sharing Gap dominates consumer perceptions of the data exchange, with a consistent belief that brands collect more data than consumers willingly share. 41% of consumers say they actively share data with companies while 56% believe that companies collect data, a 15pt gap. • Educating consumers, increasing the visibility of data and relating it to emotional needs are the essential strategies for brands looking to foster willing data sharing. However, people have gotten accustomed to free services. 92% would try new digital services if they were free, though 63% would opt to pay with ads and 62% would allow more information about them to be known. Ranking of preference to share data types in exchange for new digital services (from most to least willing - global average across all benefits and costs) Activities/ preferences Demographics Organization /movement Social identity Communications Personal information The lower the preference, the more obvious the benefit has to be for the consumer. Biometrics Microsoft Consumer Insights While many tech and media companies conduct market research that describes what consumers are doing, the Microsoft Advertising Consumer Insights team believes innovation stems from getting to the why. As a result, we take a consumer-centric approach. We go beyond behavior to focus on why consumers do what they do— whether that’s choosing one brand over another, or exhibiting a preference for a specific platform. Our goal is to humanize digital behavior and motivation, enabling brands and agencies to put consumer needs at the center of their marketing strategies. Contacts Natasha Hritzuk Sr. Director, Head of Global Consumer Insights [email protected] Ivy Esquero Senior Consumer Insights Manager, (Study Lead) [email protected] Kelly Jones Head of Thought Leadership [email protected] Esther Burke Consumer Insights Manager [email protected] ©2015 Microsoft Corporation. All rights reserved. This document is provided “as-is.” Information and views expressed in this document, including URL and other Internet Web site references, may change without notice. You bear the risk of using it. Some examples are for illustration only and are fictitious. No real association is intended or inferred. This document does not provide you with any legal rights to any intellectual property in any Microsoft product. You may copy and use this document for your internal reference purposes.
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