One of the greatest changes in the world of business is the evolving nature of the customer in the brave new world of digital. One of the people who has been most vocal about customer empowerment has been Tony Fish, a seasoned professional who has received acclaim for his work on better understanding the digital customer, notably including his My Digital Footprint project. One of the standout speakers of Loyalty World 2011, I caught up with Tony earlier this week to discuss privacy, data and the empowered customer.
Hi there Tony. First off can you tell us a little bit about yourself and what you do?
I’ve spent 20 years growing a series of public and private companies, sitting on the board of a number of them. I’m currently actively looking into how we can use data to create loyalty because the consumer wants to be loyal as opposed to being told to be loyal.
Tell me a little bit about My Digital Footprint
Every time we interact with any digital device, be it your laptop, your mobile, your tablet, your TV, your car radio, whether you’re at home or on the move, you leave behind data. What businesses want to do is get hold of that data and use it to improve the user experience. One side of the world says that that is really scary because you’re giving up everything and you can’t hide, the other part of the world says actually that it’s really engaging and useful. There are no rights and wrongs with this, it is just where we are with digital technology.
How do we stop people being scared by the prospect of the digital exhaust?
You never will be able to. If you’re going to be scared then you’re going to be scared of everything, from crossing the road to flying in a plane. People are now scared of going to see the Batman movie, for example. There is no rationality to fear and what causes fear. What we are trying to investigate is how we can create a really engaging customer experience through this data. What people are worried about is that some of the data seems quite personal. The reality is that you don’t need any of the personal data, it’s just that the headlines work brilliantly if journalists say it’s all about personal records. The headlines are ultimately designed to create fear because that sells newspapers.
Do you think that the issue of privacy is actually a relatively new concern?
Privacy in itself is not new, and in fact what the law was created for is not how it is now used. We have a lot of dilemmas because of utter confusion within the market. There are two things that ultimately cause the problems, based on experience and expectation. On the one hand we don’t like it when somebody out there has a greater freedom with our data than we would choose. That makes us very fearful. Irrespective of where you sit on the gradient of fear, if someone goes beyond your level of expectation it makes anyone feel uneasy. What we’re worried about are people who have a greater ability to do something with our data than we feel we have control of.
On the converse, our annoyance is when you’ve got regulators or lawmakers who will stop even the basic uses of your data to create an improvement in the service. We’re in this careful balance between annoyance and fear. The fear is generated when people take us beyond our expectation, and annoyance is where people don’t allow us to have the experiences that we want.
Have the lawmakers got it right with the new cookie directive?
I have to be tremendously careful, because cookie legislation is a regulatory policy and is therefore enforceable by law, so I cannot encourage people to break the law. Having said that I think it is utterly the wrong piece of legislation, it has gone about it in the wrong way using the wrong rules. You actually now need a cookie to stop cookies, it comes close to the most ridiculous piece of stupidity I have actually ever come across.
Do you foresee then that the new legislation will be amended in the future?
I just think it will become an irrelevance. Cookies served a particular purpose, and actually that purpose even today is being pretty much washed aside anyway. I think it will just look pretty ridiculous at some point in the future.
How important do you see social media in terms of the empowerment of the customer?
I don’t see it as important. Social started as social media and was driven by the user and by user behaviour. What we’ve ended up with today is a number of suppliers who have jumped in and created the pretence of social media, that they’re listening, but the reality is that all they are trying to do is peddle their products. They’re using gamification now to try to and encourage people to give more data and basically exploit that opportunity. What becomes dead interesting is when users start to show intent, and they start to publicise that they would actually like to do something. A series of providers could come back and make an offer to fulfil the user’s desire or need. This is completely revolutionary. Suppliers therefore have to be social, but on a completely different basis because it is driven by the user, as opposed to how they want to manipulate the user.
So you do see the customer increasingly driving the market?
I suppose what I see is actually two separate markets. One will be supply side driven, the other will be demand side driven.
How do you see the customer changing in the next twelve months?
I don’t think that customers change. You can manipulate their behaviour which might create some change, but generally no. What we will see change will be the generation coming through who have always been digital, I refer to them as screenagers, who will come in and adopt changes.
Do you think that screenagers are naturally going to be less loyal than their parents?
Having done a great big study on this, what is evident is that this generation trust in a different way to us. They completely think differently even about what the basis of trust is that they are implying to the brand. Today we’ve built trust based on experience, we trust certain brands because of something. Screenagers come along and their basis of trust is that their expectations are far lower. They expect almost to be abused and broken. The implicit trust that they provide to brands and services is on a completely different basis.
Do you think that Big Data has become such a buzzword that it can damage its potential?
You’re spot on. Unfortunately Big Data refers to a particular way of managing databases, and not to the way it is mostly being used. That’s a particular issue that we need to face up to. What is good is that we have given a series of words to data that people are starting to understand. The difficulty I really have is that you don’t need much data to have incredible insight into what people are doing. This is why I struggle with Big Data because ultimately Big Data is about yourself internally, whereas you need miniscule amounts of data about lots of individuals which is where it becomes Big Data which is what the management technique is about. We have a quandary in the market about definitions.
Do you think that businesses are going to firstly become more agile, and secondly rethink the sort of hires that they make to bring in more analytically minded people?
I think that there are two important points here. Firstly, data scientists are of course incredibly important and we really don’t have enough of them. The data scientists we need however are almost people who understand anthropology and psychology. What I mean by this is that just because you’ve got data and you can write an algorithm to look at data, what it doesn’t do is imply understanding and it doesn’t imply intent. The way I think of this is in terms of memory. There are certain psychological diseases or brain conditions where the person remembers absolutely everything in absolute detail. When this happens the person becomes completely broken, because they can’t forgive, they can’t forget, they can’t move on, and actually that long-term memory capability presents a barrier from them living a full life. Therefore when we look at data science, just because you’ve done something doesn’t mean you’re going to do it again. Also because you’ve done something what we don’t know is what experience you chose to be able to get to why you’ve don’t what you’ve done. This is why the study of psychology and anthropology is equally important as the roles of the data scientists providing the insights.
This brings us back to the idea of Loyalty. What makes a person loyal? What makes one person loyal could be rewards. For them the true definition of loyalty is because they are rewarded they are happy to be loyal. For someone else it could be something deeply social which makes them loyal. We have got a fantastic new world emerging about what loyalty is, in which we can look at the granularity of it as opposed to just the overall emphasis.
What were your thoughts about Loyalty World last year?
Loyalty once upon a time was perceived in a way that you could use certain tools and techniques to manipulate the user into doing what you want them to do. That is cruelty of what loyalty has in the past been about. What loyalty is turning into, and why it is so exciting again, is that suddenly the user wants to be loyal, as opposed to being loyal because of money off something. Customers won’t be loyal to Tesco because the money they get off items is go great. They’re not going to be doing it for the reward, they’re going to be doing it for the engagement. The growing subtlety of understanding is actually a fantastic move for the industry. I’m excited that it is being discussed and ultimately moved forward at events like Loyalty World.
To register for your complimentary pass to attend the exhibition and on floor seminar at Loyalty World follow this link now.