Trust! a strategic tool in the management of customer data Thom Poole Head of Portal Customer Interaction
Trust! A strategic tool for the management of customer data Thom Poole July 2004
agenda <ul><li>what is privacy </li></ul><ul><li>friendship = trust </li></ul><ul><li>trust in marketing </li></ul><ul><li...
Thom Poole <ul><li>involved in e-marketing & the internet since 1992  </li></ul><ul><li>teaching e-marketing for 7 years  ...
commercial environment <ul><li>O 2  strives for ethical e-marketing  </li></ul><ul><li>customer centricity is the goal of ...
data privacy <ul><li>what? </li></ul><ul><li>when? </li></ul><ul><li>where? </li></ul><ul><li>who? </li></ul><ul><li>how? ...
 
 
 
data privacy <ul><li>how invasive can we or should we get?  </li></ul><ul><li>will our customers accept our efforts?  </li...
data privacy – noise! Remember this? A linear model of communication (based on Schramm (1995) and Shannon & Weaver (1962) ...
data privacy – the spam debate <ul><li>does spam give responsible marketers a bad name? YES 70% NO 30% </li></ul><ul><li>c...
friendship = trust <ul><li>friendship =  showing or expressing liking, goodwill, or trust  </li></ul><ul><li>Collins Engli...
friendship = trust <ul><li>‘ people buy from their friends’ </li></ul><ul><li>trust builds loyalty  </li></ul><ul><li>trus...
trust lifecycle TRUST trust 0 time
asymmetric information flow Spremann, 2001 TRUST
trust in marketing <ul><li>abuse demonstrates untrustworthiness, but to demonstrate trustworthiness is more difficult </li...
trust in marketing <ul><li>there is no easy formula to gain trust </li></ul><ul><li>but it is, or should be the goal of ev...
trust in marketing, cont… <ul><li>trust is under attack in our society. customers have so much choice these days, which ma...
trust in marketing, cont… <ul><li>a proactive approach to dealing with issues of consumer privacy would involve four major...
trust in marketing – trusted brands <ul><li>automotive Ford  </li></ul><ul><li>kitchen appliances  Hotpoint  </li></ul><ul...
trust in account management <ul><li>“ they were always being watched for symptoms of unorthodoxy”  </li></ul><ul><li>‘ 198...
trust in b2b account management <ul><li>for b2b brands to connect with organisational customers, emotional brand values ne...
ethical account management <ul><li>“ people buy from their friends” </li></ul><ul><li>open, trusting, honest </li></ul><ul...
procurement behaviour low high high procurement skills business skills butterfly buyers strategic purchasing professionals...
the competitive advantage of trust <ul><li>“ the marketing art of the opt-in” </li></ul><ul><li>“ being trustworthy is pro...
the marketing art of the opt-in <ul><li>the research carried out within O 2  indicates customers could be encouraged to op...
getting your nose in front … COMPETITIVE ADVANTAGE
…  but so is everyone else! COMPETITIVE ADVANTAGE
local advantage COMPETITIVE ADVANTAGE local customers employees local competitors
work quality COMPETITIVE ADVANTAGE
summary 6 © Thom Poole 2004
summary <ul><li>lead the way with ethical behaviour  </li></ul><ul><li>be trustworthy  </li></ul><ul><li>keep up-to-date w...
Thom Poole Head of Portal Customer Interaction [email_address] adding value to your strategic  partnerships © Thom Poole 2...
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Trust - A strategic tool for the management of customer data

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Trust - A strategic tool for the management of customer data

  1. 1. Trust! a strategic tool in the management of customer data Thom Poole Head of Portal Customer Interaction
  2. 2. Trust! A strategic tool for the management of customer data Thom Poole July 2004
  3. 3. agenda <ul><li>what is privacy </li></ul><ul><li>friendship = trust </li></ul><ul><li>trust in marketing </li></ul><ul><li>trust in account management </li></ul><ul><li>the competitive advantage of trust </li></ul>INTRODUCTION
  4. 4. Thom Poole <ul><li>involved in e-marketing & the internet since 1992 </li></ul><ul><li>teaching e-marketing for 7 years </li></ul><ul><ul><li>e-commerce </li></ul></ul><ul><ul><li>web design for marketers </li></ul></ul><ul><ul><li>CRM </li></ul></ul><ul><li>written paper on ‘data privacy & the marketing art of the opt-in’ </li></ul><ul><li>written a book on ‘ethical e-marketing’ – Play It By Trust </li></ul><ul><li>working for O 2 as Head of Portal Customer Interaction – customer centricity and ethics </li></ul>INTRODUCTION
  5. 5. commercial environment <ul><li>O 2 strives for ethical e-marketing </li></ul><ul><li>customer centricity is the goal of all projects within the company </li></ul><ul><li>complex mix online and offline issues </li></ul><ul><li>complex mix of b2c and b2b markets </li></ul><ul><li>a leading advocate in the recent code of conduct in text marketing </li></ul><ul><li>a leading voice in the issue of marketing to, and protecting children in the ‘electronic’ environment </li></ul>INTRODUCTION
  6. 6. data privacy <ul><li>what? </li></ul><ul><li>when? </li></ul><ul><li>where? </li></ul><ul><li>who? </li></ul><ul><li>how? </li></ul><ul><li>why? </li></ul>1 © Thom Poole 2004
  7. 10. data privacy <ul><li>how invasive can we or should we get? </li></ul><ul><li>will our customers accept our efforts? </li></ul><ul><li>identity theft – a modern problem? </li></ul><ul><li>invading our personal space </li></ul><ul><li>what can marketing do? </li></ul>DATA PRIVACY
  8. 11. data privacy – noise! Remember this? A linear model of communication (based on Schramm (1995) and Shannon & Weaver (1962) – from Fill (1999)) DATA PRIVACY
  9. 12. data privacy – the spam debate <ul><li>does spam give responsible marketers a bad name? YES 70% NO 30% </li></ul><ul><li>can we control spam without banning it completely? YES 60% NO 40% </li></ul><ul><li>is opting in to receive email marketing a realistic proposition? YES 50% NO 50% </li></ul>Results of an online survey by the Marketing Society, 2003 DATA PRIVACY
  10. 13. friendship = trust <ul><li>friendship = showing or expressing liking, goodwill, or trust </li></ul><ul><li>Collins English Dictionary. Retrieved 10 July 2003, from xreferplus </li></ul>© Thom Poole 2004 2
  11. 14. friendship = trust <ul><li>‘ people buy from their friends’ </li></ul><ul><li>trust builds loyalty </li></ul><ul><li>trust will drive profit </li></ul>Trust-focused value chain (adapted from Porter, 1998) TRUST
  12. 15. trust lifecycle TRUST trust 0 time
  13. 16. asymmetric information flow Spremann, 2001 TRUST
  14. 17. trust in marketing <ul><li>abuse demonstrates untrustworthiness, but to demonstrate trustworthiness is more difficult </li></ul><ul><li>trust = firm reliance on the integrity, ability or character of a person or thing </li></ul>3 © Thom Poole 20034
  15. 18. trust in marketing <ul><li>there is no easy formula to gain trust </li></ul><ul><li>but it is, or should be the goal of every company – trustworthiness is profitable </li></ul><ul><li>“ trust means having the customer comfortable with handing over personal information and engaging in ongoing commercial transactions at a company’s website” (Senia, 2000) </li></ul>TRUST IN MARKETING
  16. 19. trust in marketing, cont… <ul><li>trust is under attack in our society. customers have so much choice these days, which makes it difficult for brands to rise above the incredible number of messages clamouring for the attention of the customer </li></ul><ul><li>“ you can have all the facts and figures, all the supporting evidence, all the endorsement that you want, but if - at the end of the day - you don't command trust, you won't get anywhere&quot; </li></ul>Niall FitzGerald, Chairman of Unilever at the Advertising Association, May 2001
  17. 20. trust in marketing, cont… <ul><li>a proactive approach to dealing with issues of consumer privacy would involve four major issues: </li></ul><ul><ul><li>maintaining an ongoing dialogue with consumers </li></ul></ul><ul><ul><li>educating consumers and promoting privacy efforts </li></ul></ul><ul><ul><li>creating an industry standard for addressing the privacy issue </li></ul></ul><ul><ul><li>continuing to lobby for and against government regulation </li></ul></ul><ul><li>these four issues can all increase apparent ‘trustworthiness’ </li></ul>(Nakra, 2001) TRUST IN MARKETING
  18. 21. trust in marketing – trusted brands <ul><li>automotive Ford </li></ul><ul><li>kitchen appliances Hotpoint </li></ul><ul><li>PC Dell </li></ul><ul><li>mobile phone Nokia </li></ul><ul><li>camera Canon </li></ul><ul><li>holiday company Thomson </li></ul><ul><li>bank/building society Lloyds TSB </li></ul><ul><li>credit card Visa </li></ul><ul><li>insurance company Prudential </li></ul><ul><li>airline BA </li></ul><ul><li>internet company AOL </li></ul><ul><li>petrol retailer Esso </li></ul><ul><li>soft drink Coca-Cola </li></ul><ul><li>vitamins Seven Seas </li></ul><ul><li>pain relief Nurofen </li></ul><ul><li>cold remedy Lemsip </li></ul><ul><li>toothpaste Colgate </li></ul><ul><li>hair care Pantene </li></ul><ul><li>cosmetic Boots </li></ul><ul><li>skin care Oil of Olay </li></ul><ul><li>soap powder Persil </li></ul>TRUST IN MARKETING
  19. 22. trust in account management <ul><li>“ they were always being watched for symptoms of unorthodoxy” </li></ul><ul><li>‘ 1984’, George Orwell </li></ul>4 © Thom Poole 2004
  20. 23. trust in b2b account management <ul><li>for b2b brands to connect with organisational customers, emotional brand values need to be communicated </li></ul><ul><li>brands based on intangible, emotive characteristics such as trust, reassurance, reputation, image and responsiveness are seen as more durable and less likely to suffer from competitive erosion </li></ul><ul><li>brand benefits include: </li></ul><ul><ul><li>ability to charge premium prices </li></ul></ul><ul><ul><li>loyalty through powerful customer/brand relationships </li></ul></ul><ul><ul><li>ability to sustain differentiation in crowded markets </li></ul></ul>Joanne Lynch & Leslie de Chernatony, 2003
  21. 24. ethical account management <ul><li>“ people buy from their friends” </li></ul><ul><li>open, trusting, honest </li></ul><ul><li>“ I don’t want a ‘relationship’ with your company!” </li></ul><ul><li>listen </li></ul><ul><li>encourage & lead by example </li></ul>TRUST IN ACCOUNT MANAGEMENT
  22. 25. procurement behaviour low high high procurement skills business skills butterfly buyers strategic purchasing professionals order takers rottweiler buyers buy on value buy on cost buy on price TRUST IN ACCOUNT MANAGEMENT
  23. 26. the competitive advantage of trust <ul><li>“ the marketing art of the opt-in” </li></ul><ul><li>“ being trustworthy is profitable” </li></ul>5 © Thom Poole 2004
  24. 27. the marketing art of the opt-in <ul><li>the research carried out within O 2 indicates customers could be encouraged to opt-in and therefore interact </li></ul><ul><li>keeping within the ‘RFM’ (recency, frequency, monetary value) boundaries is likely to increase trustworthiness </li></ul><ul><li>creative ideas for encouraging opt-in and increasing interaction will always win </li></ul><ul><li>trust is a two-way process, and we as marketers must feel that our customers are trustworthy too </li></ul>COMPETITIVE ADVANTAGE
  25. 28. getting your nose in front … COMPETITIVE ADVANTAGE
  26. 29. … but so is everyone else! COMPETITIVE ADVANTAGE
  27. 30. local advantage COMPETITIVE ADVANTAGE local customers employees local competitors
  28. 31. work quality COMPETITIVE ADVANTAGE
  29. 32. summary 6 © Thom Poole 2004
  30. 33. summary <ul><li>lead the way with ethical behaviour </li></ul><ul><li>be trustworthy </li></ul><ul><li>keep up-to-date with technology, but don’t be led by it </li></ul><ul><li>stay legal </li></ul><ul><li>manage your competitive advantage </li></ul><ul><li>marketing can be creative – use that creativity! </li></ul><ul><li>treat customers as they expect to be treated </li></ul>SUMMARY
  31. 34. Thom Poole Head of Portal Customer Interaction [email_address] adding value to your strategic partnerships © Thom Poole 2004 All rights reserved thank you

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