November 30, 2023

Riaz Raihan is President at Alinda.

Cookies have long been a ubiquitous part of the online world. But change is coming fast. We’ve already seen regulations introduced around the world, including the European Union’s General Data Protection Regulation and the Personal Data Protection Directive, the Canadian Data Privacy Act and the California Consumer Privacy Act.

Increasingly strict regulations are inevitable. The likely end point is that cookies will disappear entirely. That means tech companies need to get ahead of the curve now by finding new and better ways to collect customer feedback.

Zero Part Data (ZPD)

The best way forward involves an approach known as ZPD. As defined by Forrester, ZPD is data “that a customer intentionally and proactively shares with a brand.” Forrester notes that can include “preference center data, purchase intentions, personal context” and instructions on how the individual wants to be recognized by the brand.

For example, consider products commonly marketed to pregnant women. The seller may ask when the baby is due. Expectant parents then have a choice. They can decide to share this date or not to share this date. If they share it, the company can use that information to determine when their product is most likely to be purchased. For many baby products, parents tend to buy a few days before or a few days after giving birth. Having this date allows the seller to zero in on the right time to contact the parents.

Personalization without being creepy

It is important that the customer shares their personal information with the company knowingly and willingly. Otherwise, the consequences can be disastrous. Consider what happened to one company after it unknowingly sent coupons for baby products to a teenage girl. Her father saw the coupons in the mail, tipping him off that she was pregnant. This led to a lot of turmoil for the girl and her family.

This represents a classic case of what we aptly call “creeping.” The company took basic data about her pregnancy, mistakenly assumed A equals B, and created a mess. ZPD is specifically designed to prevent such problems. Personal information may be collected and used only when expressly provided and authorized by the consumer.

About 80% of customers say they are more likely to buy from a brand when a personalized experience is provided, according to report from Epsilon. However, at the same time, poorly executed personalization can cause 38% of customers to abandon a brand, based on overview from Gartner. So, it’s a double-edged sword that companies have to find a way to balance.

A far higher order than consent

It is important to appreciate how ZPD is much more than consent. Think about when you load a new software onto your cell phone. Your first step is usually to read and sign one or more agreements. But most people don’t even read them. They just quickly click “OK” because they want to go to the next screen and start using the software. In fact, even though they haven’t read any of the terms of the agreement, they have unknowingly given their consent to the software maker to monitor all of their activities.

So you might think that consensus has a very low bar to clear. It’s the minimum. In contrast, ZPD meets much higher standards. Consent is only the starting point. ZPD requires full awareness of the company’s intentions and that the consumer takes a proactive approach in wanting to share personal information. They know exactly what they are sharing, why they are sharing it and what it will be used for.

Strong investment in customer experience

Setting cookies is only going to speed up. We may be heading for a “cookiepocalypse” as they completely disappear from web browsers. Customers now demand better customer experiences. They want companies to ask them what they want, not just take it without their permission. Most importantly, they want to know that their knowledge is actually being put into practice.

As a result, companies must be prepared to collect customer feedback in a manner shaped by the ZPD, rendering cookies irrelevant. One way to do this is to invest smartly in a modern customer experience (CX) tool. With plenty of speed, depth, and a wealth of new features, a CX approach to ZPD is an effective way to stay well ahead of the coming cookie collapse.

Companies can also ask their store associates to build relationships with customers in the store and capture information directly from them. Another option is for organizations to ask their call center agents to voluntarily collect data from customers during inbound calls.

As the two-way relationship with the customer is established, trust will become stronger. This will lead to customers becoming more willing and enthusiastic to continue providing data needed to create better experiences. There is so much you can learn from behavioral insights generated by cookies. Without ZPD and an innovative approach to complement it, companies are sure to miss the real motivations behind customer actions.

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