• by Ray Schultz , March 30, 2023

Brands and consumers are in alignment on several points concerning privacy as the end of the cookie approaches. But there is still a trust gap between the two sides, according to The State of Customers, a new study by Twilio.

Of the consumers polled, 31% always reject cookies on websites. And 98% want companies to do more to protect their privacy, while 95% want more control over their data, particularly identity data.

Moreover, 67% of consumers prefer that brands use only first-party data to personalize their experiences — i.e., data gathered directly from interactions, purchases and questionnaires. 

Marketers seem to agree in theory: 89% say using first-party data improves the customer experience. But 81% still rely on third-party data.

Despite their wariness about privacy, consumers demand personalization — 66% will stop using a brand if they don’t get it. Among Gen Zers, that figure rises to 75%. 

In addition, 86% 86% overall say that personalization increases their loyalty to brands. And 57% will spend more with firms that provide it — an average of 21% more.

But 51% of consumers report being frustrated with their interactions last year, up from 46% the year before. And many consumers opt out. In 2022, brands made over 23 million user deletion requests on the Twilio Segment platform, a 69% increase over 2021.

Meanwhile, companies are spending more on engagement: 97% expect to almost double their investment in three years. 

Of the customer engagement “leaders” surveyed, 82% met or exceeded their financial goals for 2022, compared to 62% of beginners. And 40% of the leaders enjoyed much higher retention rates that they did in prior years, versus 12% of beginners. 

Finally, 41% of leaders achieved much higher customer conversion rates, compared to 15% of beginners. 

The takeaway: "This research reflects what we’re hearing across our customer base, which is that when brands use first-hand data to personalize engagement with customers, it saves companies meaningful marketing spend and increases lifetime value,” says Joyce Kim, chief marketing officer at Twilio. “For brands facing growing headwinds, this means ROI today.”  

Twilio surveyed 4,700 business-to-consumer (B2C) leaders and 6,000 consumers across the globe.