Ease Away to Avoid Violation Backlash

There are dangers in having close business relationships with customers. A study at University of Southern Indiana, Louisiana Tech University, and Kennesaw State University shows this to be true with persuading customers to share with you private information to help you better personalize what you’re offering.
     A group of the study participants was asked to think of a retailer with whom they’d had both a “great online shopping experience” and “the best relationship.” Another group was asked to think of a retailer with whom they’d had both a “poor online shopping experience” and “the worst relationship.”
     Then all the participants were told to imagine they’d learned, via a news article, about a privacy breach in which several online companies had sold their customer databases to a data analysis firm without permission of the customers. In addition, some of the participants were told to imagine they were upset to read that the retailer they’d named was among the companies having breached privacy. The other participants were told to imagine they were relieved to read that their named retailer was not among those breaching privacy.
     The participants’ reactions to this indicate that an excellent relationship with a retailer increases a  consumer’s willingness to share personal information. However, the results also suggest that if the consumer’s privacy is subsequently violated, those having enjoyed an excellent relationship might retaliate against the retailer, such as by withholding personal information. This undesirable retaliation is less likely with those having had a weak relationship.

     Close relationships with customers offer so many advantages that it’s best not to stay distant. An effective way to do this is to honor your commitments. But if a commitment, such as protecting privacy, is violated, you’ll need to work more diligently to correct for the problem with those customers in a close business relationship with you.
     Another study points to a preventative tactic: You’ve asked the owner of a restaurant with whom you have a close business relationship to hold an ocean-view table for your birthday bash. When you arrive, the owner explains, with a tone of regret, that all the ocean-view tables are taken. How would you react?
     What made the difference for study participants was whether the customer and retailer had clarified in advance their respective expectations and obligations. With this, there was more customer empathy for the owner’s needs. Without this clarification, several study participants reported feeling betrayed.

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