To Protect and to Serve

Complying with privacy laws may also be an opportunity for better consumer preference management

OFFER OPTIONS, NOT LIMITS

Although you must retain the appropriate level of information for each customer to meet legal requirements, you should avoid unnecessarily limiting your potential information gathering and sharing. Unfortunately, most organizations currently attempting preference management take an all-or-nothing approach: Either you can share a customer's information or you can't. Despite the fact that such a conservative approach does meet legal requirements, it is unnecessarily restrictive. By retaining a finer granularity of preference information, your organization can eliminate only those points of contact and information sharing that a particular customer finds undesirable.

By offering consumers more options, an organization can identify which products and services interest customers the most by their indication of a desire, or at least willingness, to receive relevant contact, thus giving permission to share information in those areas. For example, a banking customer with a significant amount of consumer debt may not want to receive any credit card solicitations, but would be very interested in debt-consolidation services. You can greatly enhance campaign precision by retaining line-of-business-specific consumer preferences while avoiding privacy violations at the same time.

You can break down information-sharing preferences into two categories based on the nature of the recipient of the customer's information. These categories are internal or affiliate and external or third party. In these cases, you should offer the consumer the opportunity to opt out of sharing on a case-by-case basis. Take your contact preferences to an even finer granularity: Rather than a single "do not contact" indicator, your organization should solicit individual preferences for each potential type of contact. In the case of "Do not call," you could offer a range of call times. For example, customers may not want to be called in the morning because they're preparing for work or getting their children ready for school, but would not object to a telephone solicitation in the evening. Rather than eliminating potential contact with a customer, you can manage consumer preferences at a detailed level and enable your marketing staff to determine when and how to most effectively reach a targeted consumer.

Once a consumer expresses a preference, you must organize and retain that preference in a manner that will let you retrieve and apply it throughout your business. Although you may associate a customer's preferences with that single individual across the enterprise, you may retrieve them through a variety of associations. Most individuals have multiple accounts - each potentially having its own set of contact information. Similarly, multiple individuals hold most accounts. As a result, you must store a given set of consumer preferences at the individual level so you can retrieve it at the account level. For example, bank customers may contact their mortgage representative and express a preference to be removed from the bank's mailing list. The mortgage account manager suppresses the individual for future mailings at the address given for the mortgage. Unfortunately, these particular individuals also have checking accounts with different addresses at which they soon receive unwanted mailings from the bank. Beyond federal and state penalties that may be levied, these customers' trust in the bank has just evaporated.

Additionally, you must decide how to handle joint accounts. An institution has the choice of sending either a single notice per account or individual notification to each person associated with an account. If a single notice is sent, the response to that notice must apply to all individuals associated with a given account. If separate notices are sent to every person on an account, you must retain and honor each individual response.

WATCH YOUR BACK

At some point, despite the best of practices, your organization will face a privacy violation claim. In order to successfully defeat such a claim, you must maintain an audit trail across all preference-related transactions by keeping historical versions of all expressed preferences. This process will also help customer service representatives explain to customers why the currently active preferences may not reflect what customers think they have expressed. These discrepancies are generally due to timing and coordination issues. For example, a customer may respond to an initial opt-out mailing expressing only a "do not share" preference. The day after mailing the response card, the customer has second thoughts, calls the bank, and requests "no sharing" and "no contact." This new preference may be recorded in the system long before receipt of the original mailed request. When the response card arrives, the older, less restrictive preference will supercede the more recent and restrictive preference. A time-stamped record of when the change was made and from which source it came will easily clear up the situation. Without that record, your organization has just committed a privacy violation.

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Perhaps the biggest challenge of preference management is making consumer preference information available across the enterprise. The only reasonable approach to this dilemma is to establish a central, shared repository of all preference information. You can then enhance this data with external sources such as the DMA, state attorneys general, and third-party vendors.

Compliance with GLBA is simply a starting point. Laying a strong foundation for consumer preference management will help an organization comply with both current and emerging legislation and industry practices. Over and above keeping an organization out of legal trouble, respecting consumers wishes on how their data is used and maintained is just good business.

DARIN L. STEWART [dastew@acxiom.com] is a senior architect and technical lead for Acxiom Corp. and is responsible for developing its Consumer Preference Solution service.