Consumer Privacy on the Rise Brings Retail Opportunities

There has, for a long time, been a level of disconnect between the use of consumer data, and the experience they receive from retailers as a result. The use of data and how it is shared between consumers and brand has long been a focus. There has been a battle between brands gathering insights and information to better their customers’ experience, and respecting consumer privacy.

This battle started in the 1980’s, when customer data first became available to brands. At this time, consumers had very little control over what data they shared and how it was being used. Brands were not required to be transparent with consumers about the information they had stored, where it was held, who it was shared with or what it was used for. Marketers were gathering as much data as they could to use in a variety of ways, and as a result, data breaches were a more common occurrence. Unsurprisingly, having consumer data readily available in this way has led to an increased reliance from marketing teams on the ability to track and measure with very few regulations in place, until recent years.

The rise of consumer privacy

In the past few years there have been numerous privacy updates and regulations introduced, designed to make the lines between data use and consumer privacy clearer. The most recent being within Apple’s iOS15 update – which is having a significant effect on the email marketing world already, since its launch in September last year.

One of the main features of the update – Mail Privacy Protection (MPP) – is having a major impact on email tracking. The MPP feature hides users IP addresses meaning senders, in many cases, can no longer accurately track email engagement, giving users the opportunity to stop brands from tracking their activity over email. This means it is harder for retailers to obtain accurate information about whether emails to customers and prospects are being received, read and engaged with.

Whilst we are still in the early stages of adoption since the iOS15 release, it’s only a matter of time before all Apple users have downloaded the update and are making use of the new privacy settings on offer. According to data from SparkPost,  97% of Apple users who have downloaded iOS15 have opted in to MPP. But it’s not all doom and gloom, and rather than causing mass panic within the marketing world, there is an opportunity for brands to make positive changes to their marketing strategy that will benefit them and their customers for years to come.

How does this increase in privacy affect email inbox performance?

Historically marketers have been using open data to keep their lists clean and their deliverability metrics in a good place. Using this metric in this way has been known across the industry as best practice. 

With these new changes, however, recipients won’t necessarily be removed from lists for never opening an email because marketers won’t have the open data. This not only means a less personalised experience by default but also has the potential to affect inbox performance.

As a retailer, if a contact never opens any of your emails, best practice is to eventually stop emailing them because you can assume they are no longer interested in your content. With these changes, it is now much harder to determine true open rates and makes it more likely that marketers will continue emailing customers who have no interest, leading to deliverability implications. 

How can brands maintain a good customer experience, with less data?

Whilst consumers want privacy, their data to be handled securely and with their best interests in mind, Apple’s move isn’t a panacea for privacy: it’s just one factor. 

Personalisation within the email channel has become an integral part of how brands use the channel to connect with their customers and personalise their experiences so that what they are sending is convenient and relevant. 

The average consumer may not understand that by selecting to ‘protect mail activity’, the experience for them may get muddled down into something less personal, giving them a below-average experience. 

A lot of information is passed through the open pixel*. Information like device, location at the time of open (IP) and time of open is going to be lost and thus some of the innovation that hinges on this data will also be lost. Brands will need to enhance their first-party data, using data from other channels, to improve customer experience. 

*An open pixel is a small, invisible pixel that, when loaded, tracks the user as an open in addition to details like IP address for regional location tracking, device type and time of engagement. 

How iOS15 impacts retailers

What’s happening with this change for retailers sending emails, has a lesser impact than the crushing changes to the advertising ecosystem. Opens are not a perfect metric and come with flaws. It does, however, tell us engagement trends over time. The technology behind opens powers more than an engagement metric (even if that metric is flawed). It makes a lot of the innovation in the email space possible, which is now up to question. 

People have come to depend on email opens to gauge upper email funnel engagement such as the value of the subject line, preheader and brand. Without this, it will be challenging to optimise those parts of the email experience. 

Opens aren’t the only way to gauge the viability of list engagement but they are the highest in the email conversion funnel. This means more people will be culled from email lists due to a lack of engagement by way of clicks. But there are things senders can be planning for to reduce the impact. 

1.   Subject line testing

Subject line testing that relies upon open tracking will no longer be an easy thing to test. Metrics like clicks and conversions that are further down the funnel from the subject line will have to be used. Companies that use Natural Language Processing to optimise subject lines will need to rethink their strategy to update the algorithms that support the effectiveness of their products. However, subject line testing that relies upon data from panel engagement will continue to provide relevant insights and predictions.

2.   List hygiene management

Without access to opens, senders will need to rely on clicks and deeper behaviours to know if a real human is still there and interested in the content. Opens have long been an important leading indicator of user disengagement which promoted early removal/retargeting of disengaged users. Some senders might even fall into bad sending practices by not having this metric to use for segmentation. Those who aren’t ready for this may find these news ways challenging. 

It may be that looking at each recipient’s engagement across channels will be a way of telling if they are interested in engaging with you. If you don’t see clicks or other channel engagement over a period, it might be time to consider removing them from your lists. 

3.   Algorithms to support engagements 

Send-time optimisation often takes opens into account as part of its algorithm to determine the right time to send the email based on open and click engagement. Technologies that power this capability will need to ensure they are updating their algorithms to pull out open engagements for iOS15 users. Check with any vendors you’re working with on how they plan to handle this. 

Other innovations such as weather widgets, store locators and trackers that detect which OS you use will also be impacted. 

4.   Updates to data strategies

If you use email opens to establish recipient residency, you will need to confirm the location of your subscribers if you want this information for personalisation. Going back to basics – asking your customers to update their profile – will be important.

5.   Monitor inbox placement

Getting emails to the inbox will be more important than ever – assuming your emails have landed in the inbox based on opens will no longer be reliable. Having a sufficient deliverability tool so you have these metrics at your fingertips will be crucial in mitigating the impact of the iOS15 privacy changes. You’ll need deliverability analytics to understand the health of your list to ward of deliverability risks. 

Customer centricity is the way forward

The privacy features within iOS15 are not the first to shake up the marketing space, and they certainly won’t be the last. What is important, is that brands are willing to adapt how they use data in order to continue to provide customers with a highly personalised experience that respects their right to privacy. These changes require brands to remain customer focused at all times, and to always be thinking about how to make processes and experiences better and more personalised.

If brands are more transparent about sign up options, explaining the use of data, and sticking to their promises, customers are more likely to share data and information with brands in exchange for a more personal experience – it’s a two way deal.For more information on privacy protection and the impact on email, please visit the SparkPost website.

By Sam Holding, Head of International, SparkPost.

About SparkPost

SparkPost is the industry’s most trusted email sending and optimization platform. SparkPost helps senders reliably reach the inbox with powerful solutions to help them plan, execute and optimize their email programs. The SparkPost platform is powered by the industry’s largest data network, a team of email experts to help brands elevate every aspect of their email program, and a security and compliance posture to support even the most regulated industries. SparkPost is the world’s largest sender, delivering nearly 40% of all commercial email – over 6 trillion sends annually – and also boasts the world’s largest data footprint to help enterprise-level brands make data-driven decisions to improve their email performance. The world’s most sophisticated senders, including The New York Times, Zillow, Adobe and Booking.com trust SparkPost to elevate their email. Learn more at www.sparkpost.com or connect via Twitter, LinkedIn or the SparkPost blog. SparkPost is a MessageBird company.