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Banks’ ‘creepy’ practices

Posted on: Monday 18th of April 2016

‘Big Brother in your bank’ screamed the front page of the Daily Mail over the weekend. The story was about banks employing hundreds of data analysts to “comb through every aspect of an account holder’s finances to build up an in-depth profile” of customers and their propensity to buy different products.

Words used in the article include ‘underhand’, ‘subterfuge’ and ‘bizarre’.

The banks mentioned in the article – TSB, RBS and HSBC – might well dismiss it as ill-informed hype. With some justification. After all, doesn’t every company use customer data to understand its customers better, to improve services and sharpen the targeting of messages?

But there is a deeper issue here which banks (and every other data-using company) just can’t duck.

Psychologists investigating ‘creepiness’ find it has a number of characteristics.

  • ‘Creepy’ people have a tendency to get too close for comfort, physically and/or emotionally. Creepy people claim unjustified intimacy and cross boundaries, thereby creating a sense of intrusion or invasion.
  • With creepy people, you are never quite sure what their motives or intentions are. This creates a sense of risk and uncertainty and destroys trust.
  • Creepiness is also associated with a sense of being watched. We don’t like people who stare at us. Somehow it’s threatening and intrusive.

The sad fact is that today’s standard model of customer data collection and use is almost perfectly designed to trigger these creepy feelings.

This model is based on organisations collecting data about you, going through some process which you don’t understand behind your back, to do things to you. It can’t help but create a sense among customers that they are being watched and intruded upon, where they can’t trust the other party’s motives.

It’s also (by the way) incredibly inefficient, based more on guesswork (bigged-up by grand phrases like ‘propensity modelling’) than real knowledge or insight.

 

The emerging model

The emerging model, now being explored by a growing range of leading companies, is to create trust-based data sharing relationships with customers, focused on using data together to add customer value. This approach is transparent. It puts customers in control of their data. It’s all about using trust to create new information services for customers, strongly signalling this intention as part of the brand’s positioning.

What is ‘bizarre’ (to use the Daily Mail’s word) is that advocates of today’s model talk about using data to build better closer relationships with customers, yet the very way they go about it screams (like the Daily Mail’s headline) that it’s the very opposite of a real relationship. In a relationship, you don’t gather information about people; you share information with them. In a relationship, you don’t do things to people; you do things with and for them.

The opportunities opened up by the emerging model of trust-based data sharing are immense. Scare stories like the Daily Mail’s will remain a common occurrence until it is adopted.