If understanding your customer is the key to successful marketing, then customer data is a company’s most valuable asset. Most organisations with an online presence add a registration process to their website to collect information about consumers. This is, however, not necessarily a useful strategy.
Although the digital has even made it possible for you to collect this kind of information, it has also made the attention span of the average user sink to that of a goldfish. Time spent typing in personal information soon seems too much. Recent research by social web consultant Janrain showed that 68 per cent of users are so bored by online registrations that they leave the site. 78 per cent just type in incorrect information.
Still, businesses don’t want to give up on collecting customer data. The alternative to online registration is called social login. Social login allows the user to register on a brand’s website through a social network. One click on the Facebook button, without hassle, without typing. It’s so convenient that 85 per cent of respondents to the Janrain survey insist social login should be offered by websites.
On first sight, the advantages of social login are convincing. It doesn’t give the user the chance to enter false information. As Return on Digital CEO and Real Business columnist Guy Levine puts it: “Whereas in the old days, consumers gave you the minimum amount of fake data they could get away with, a social login now gives access to that person’s soul.”
Social login also removes the need for expensive security investment to manage and store customer usernames and passwords. Mid-sized businesses often spend money on web security that might not even be good enough. The risk of losing customer data in a potential hacking attack is significant. Social login promises to pass on the security responsibility to a team at Twitter, LinkedIn or Facebook, who understand data security to a greater extent than the average websecurity professional.
The information drawn from a social profile is more extensive than the kind of data users would provide to an individual business, which in turn enables organisations to deliver relevant advertising content to the individual. With technology research organisation Gartner predicting that 80 per cent of discretionary buying from consumers will soon be driven through effective digital marketing, it’s time for organisations to focus on targeted advertising. Users are growing tired of an online environment that fails to target their needs.
But social login also has its downsides. “It is reported that when surveyed around 58 per cent of people who “like” you [on Facebook] or socially log in in do so because they expect some privileges, often focussed on discounts or VIP services,” Guy tells Real Business. Is the margin erosion worth it? Businesses will have to decide for themselves what they could offer their customers in return for their data.
The biggest downside is the fact that you’re involving a third-party network in the business-customer interaction, which means putting the data into somebody else’s hand.
“At the end of the day, you have to ask yourself who owns the relationship. When someone verifies themselves with a social account, the platforms are gathering more data than you. It’s helping them build their user universe, allowing them to sell more targeted advertising,” Guy Levine says.
He does, however, have some advice to handle the relationship: “In order to win, a hybrid approach is needed. Yes, get a social login, use the extended data and remove the resistance to register, but also go old school. Collect email addresses, mobile phone numbers and even the old postal address. Then you can really build some data you own.”
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