Responsible Marketing Protects Customer Trust

The Gist

• AI and customer trust. AI’s transparency is crucial for building customer trust. Marketers must consider biases and fairness when making AI-based decisions.

• Responsible marketing strategy. A responsible marketing approach guarantees that customer data is used ethically and transparently. 

• AI in marketing compliance. Marketers must invest in technology like CDPs to manage customer data responsibly and maintain compliance with regulations.

The rapid rise of AI has changed the way marketers approach customer hyper-personalization. Advanced technologies such as AI-enabled automation and optimization are allowing levels of individualization like never before. But at the same time, marketers are keenly aware that when used inappropriately, they can jeopardize customer trust.

Today’s hyper-personalization requires that customers trust a brand with their personal data to receive tailor-made offers, but customers are smart and want to know that their data is being used ethically. As popularity and adoption of AI continues to escalate, responsible marketing is bridging the critical gap between personalization and transparency.

And it’s not just customers who demand responsible marketing. Regulatory frameworks such as the GDPR and the EU’s recently passed AI Act put new pressures on the entire management level, not just the CMO. Leaders must invest in responsible marketing, meet legal requirements and maintain a positive brand image to ultimately drive economic success.

Table of Contents

Achieving AI Transparency for Customer Trust

This arena is tormenting marketers. Transparency is quite literally AI’s biggest crux at the moment. While AI allows 1:1 communication, it’s important to consider where its data came from and how decisions are made. 

For example, to evaluate the fairness of AI-based decisions, marketers must consider any potential bias of data and models. If models are trained with unbalanced data, this can lead to distorted results and non-neutral decisions that disadvantage entire groups of people due to factors like gender, origin and social status.

The only way to achieve responsible marketing is by having the ability to assess models for effectiveness and fairness of their algorithms, and then you must adapt them if necessary.

The Path to Responsible and Transparent Marketing

Marketers that want to build customer trust and handle data more responsibly in the age of AI can follow a three-dimensional assessment framework to determine their responsibility maturity status.

Data

This dimension provides information for both compliance (i.e., industry-specific regulation, data protection) and level of personalization. It’s important that marketers ask questions about the origin, quality and intended use of customer data.

Technology

Understanding which models are used to interpret data is critical. Marketers can use audits to gain more transparency into whether the models are interpreting data ethically and in accordance with regulatory frameworks.

Resources

Ultimately, are the technologies working? Marketers should measure the efficiency of the technologies and employees using them. They can use metrics such as return on marketing investment (ROMI), profit and loss (P&L), attribution accuracy and CSR scores.

Related Article: Building a Trust-First Brand: Transparency and Consent in Marketing

Gaining Control Over Ethical AI Practices

Uncoordinated investments in marketing systems during the pandemic created silos. It’s time to consolidate technology to make better use of it. Integrated customer data platforms (CDPs) help marketers achieve this through AI and analytics functions that make sure the use of customer data is compliant. These systems also control the movement of personally identifiable information so that only relevant data is retained for the personalization and activation, which helps uphold customer trust. 

Using Responsible Marketing as a Competitive Edge

Companies are finally realizing the need to prioritize data governance, security and privacy. Critically examining data processes should not be viewed as a restriction but instead as a competitive advantage opportunity. Hyper-personalization lowers waste from things like mass-mailings, and it effectively lowers and controls the costs of campaigns. Responsible marketing results in tangible economic benefits.