The largest U.S. companies are collecting more personal information from customers, but are less likely to spread it around, according to a new report.
Posted Sep 8, 2006
Major companies know more about consumers than ever before. A new study from The Customer Respect Group (CRG) found that the 100 largest firms in the United States are gathering more personal information about customers. Although this data mining can lead to improved customer service and more relevant communication, it brings to task the importance of information security and company-customer trust, according to CRG. In a positive step toward corporate responsibility, these larger firms are sharing less customer data outside of their organizations and are becoming more transparent at communicating their marketing opt-in or -out policies to their customers. However, "The Online Customer Respect Report," finds that an increase of unsolicited contacting points to a lower level of customer control.
"The Fortune 100 companies generally outperform and invest more in respect for the customer. This year, they kind of fell back in the pack," says Terry Golesworthy, president of The Customer Respect Group. Golesworthy cites the use of personal information for unsolicited marketing efforts as the primary reason for this backslide. Information customers divulge for other purposes is often used for marketing efforts. While this is nothing new, the frequency of these practices for big companies has increased and it can lead to a breach of customer trust. If a customer wants information, Golesworthy says, he or she can seek it out rather than being bashed over the head with it.
However, privacy policies are becoming less shaded, according to the study. More than half (54 percent) of companies directly state their opt-out policies to their customers and 52 percent are clear at communicating their data sharing policies. This marks a significant increase, as only 34 percent of companies had open data sharing policies in 2005. Golesworthy explains that the difference between a company acquiring customer information or not often comes down to whether or not the opt-in box is checked by default. Although companies are becoming more responsible about having this box available, the default setting can lead to customers giving out more information than they would want.
Site usability overall is improving, but companies are still lagging in integrating online standards to make their sites easy to navigate for the disabled, according to the report. The sites with the best usability were found to be Intel, Johnson & Johnson, and Wells Fargo. All of these sites had interfaces that accommodated disabled users' needs. As for the other companies' sites, only 14 percent had strong, contrasting colors on their navigation buttons and fewer than half (42 percent) had created tag descriptions for all images on their site.
As for answers to customer inquiries emailed in or sent through a company Web site, the content of replies is improving although the turnover rate is still slow. Hewlett-Packard, Bank of America, and Sprint came out on top as the most communicative and responsive companies to customer requests. The report found that 81 percent of responses were very helpful and 10 percent of responses were somewhat helpful. The thoughtfulness of the response, however, means that response times suffers. Only 13 percent of the companies consistently respond to customer requests within 24 hours.
Golesworthy says that while the quality of communication between customers and companies is a step in the right direction, companies still need to be sensitive about reaching out too much to consumers online. "You've got to be very careful about not overwhelming the customers with messages. If you turn the customer off--you've lost it."
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