In today’s digital world, trust is a critical component as consumers spend considerable amounts of time online and on mobile devices shopping, searching and communicating. While these consumers are increasingly becoming concerned with privacy, businesses may be surprised to find out who their customers actually trust, and what it takes to maintain their trust.
According to the fifth annual KPMG Consumers & Convergence study, participants indicated that they would allow retailers and content providers to track their activity, or solicit them with advertisements, in return for discounts on products and services.
In reviewing the habits of U.S. consumers using internet, phone, and cable, KPMG found that 52 percent would be willing to allow usage patterns and personal information to be tracked by advertisers if this resulted in lower product costs or free online content. In addition, 43 percent are willing to receive advertising in exchange for lower fees or service. In looking at mobile phones, only 28 percent said they would be willing to receive such advertising for a lower fee.
In both cases, it is the younger crowd, ages 16-34 and 35+ respectively, that is more willing to swap privacy for savings, compared to the older generation who wouldn’t budge. Translated, this means that some security reservations and usage preferences exist, but the increased adoption of digital business models provides a compelling argument for retailers, content providers, and advertisers to make changes.
“Consumers are in the driver’s seat,” said Mark Larson, KPMG’s global retail practice leader.
“They continue to be guarded about invading their space and wish to dictate their terms of access. It is imperative for these companies to use data analytics to leverage the customer data they have at their disposal to conduct customized consumer outreach. We see some retailers adopting these strategies online to offer customer product suggestions, coupons, and mobile shopping applications, among other programs.”
Another split between generations is that the older adults, who considered tracking in exchange for a price break or other bonus, would only do so for retail activities. However, the younger set gave more consideration for entertainment value.
Larson added, “I think these findings send an important message to retailers – providing compelling reasons for consumers to share information about themselves is going to determine the winners and the losers in digital commerce. The more targeted and tailored the interaction is with the consumer, the more effective it will be.”