GDPR and Loyalty: Time to reset engagement

GDPR and Loyalty: Time to reset engagement

The deadline for the General Data Protection Regulation (GDPR) implementation is fast approaching, 25 May 2018 to be exact. Our deadlines to adjust and adapt to the new rules introduced still has many retailers and businesses scratching their heads, wondering what exactly GDPR wants us to do and how we can do it. In this article, I discuss the issues retailers are facing and the advantages that the new regulation will bring.


For retailers globally, GDPR is a daunting prospect that needs addressing. Retailers are required to adapt and modify their current set ups to accommodate the new regulations and failure to adhere to the GDPR regulations may well result in financial and reputational consequences.


Data collected is no longer aligned with the spirit of the new rules

The biggest issues that retailers face surround the vast swathes of data collected from loyalty cards and the reality that this data, when originally signed off on T’s & C’s, is no longer aligned with the spirit of these new rules, and as a result, it is vital that careful consideration is put into implementing the new regulations.


Retailers must be transparent and clear with regards to securing consent from customers, and that potential use of customer information is understood by the customer.


Explicit consent will lead to trust between the retailer and the customer

Yet, GDPR may well deliver unique advantages. It allows retailers to bridge the gap between them and their customer, which is built on trust as it requires explicit consent from the customer to store personal data and process it.


Retailers will do well in saying that GDPR may have come at just the right moment as it may be the trigger for a T&C’s visible for both parties to see with ease, unlocking dimensions to customer engagement like never before.


It’s common knowledge that most retailers with a loyalty card system have the insight to react and engage with their customers faster and with more personalised targeting. Tesco’s were the first to really use custom data to deliver exceptional growth, and retailers like Sainsbury’s delivered quarter by quarter growth, even through the financial crisis, by pivoting ranges at incredible speed.


Retailers still working with archaic methods

These retailers and many more provide target based offers for their loyal customers, but the timing of these offers and the media delivery is still largely archaic. But as regulatory changes are now imposed, GDPR is the opportunity to re-assess and future proof your means of engagement with customers who are already loyal to your business.


Beacon technology lacks sparkle

However, as we know, not all that sparkles has turned to gold when it comes to moving to more digital ways to engage, with Beacon technology a shining example. Beacon technology failed to hit anything like the engagement levels that it promised, retailers like Tesco, Carrefour and Monoprix couldn’t get even low single digit engagement as the technology depended on too many factors.


Opportunity to reset trust

This is the opportunity to reset trust. Ask customers when and how they want to be communicated to, and how this should be delivered. As many retailers need to re-issue loyalty cards again, it is the opportunity to ask customers implicitly when and how they prefer to be interacted with. The options – such as paper based statements, coupons posted, emails or even automated targeted offers to their phones. Retailers also need to be implicit that the data being collected is going to be shared with the likes of Dunnhumby, EYC, AIMA, 5One and Emnos and the subsequent use of this data back to FMCG’s for insights and marketing strategies.


RFID technology may be the right answer

The holy grail of marketing has always been delivering the right offer, at the right time, in the right place. This is what Beacon technology offered but it was a leap just too far for most customers. Radio Frequency Identification (RFID) technology, used mainly for stock control, may well be the right technology layer to sweat the current RFID assets that many have invested in.


By combining specialist RFID technology to identify your customers as they enter your physical stores, the engagement opportunity fulfils that holy grail. Unlike Beacon technology, with RFID, every barrier and hurdle is removed. The combination of RFID sensors, next best offer solutions delivered through analytics and embedded specialist antennas inside loyalty cards, the right offers can be delivered to every customer.


By gaining new permissions, by using your current data, retailers will illustrate the value of offers delivered and redeemed. This could be the point where smarter retailers gain more basket share as their customers see their loyalty to one brand is providing better value.


Opportunity to change engagement and build loyalty and trust

With this as a foundation, many retailers may need to plan an ongoing step-by- step technology road map to be prepared for maybe more complex digital engagement. GDPR not only provides the transparency needed to reset the retailer/customer relationship but it also offers the real opportunity to change engagement, allowing customers to build emotional loyalty and trust with you as a retailer.


By Paul Sheedy

For more information please call me on +44 (0) 20 3668 3686