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The Importance of Holding Personal Data
Research Insights

The Importance of Holding Personal Data

Did you know that the cat photos your customers upload on your social media train the machine to be smarter, and their location history helps investors decide which store attracts more customers? Or did you know that questions asked on Google or search engines help you uncover the most profound secret and inquisitiveness of web browsers?

That’s why businesses like you collect personal information!

This information helps you make vital decisions. Also, personal information is often synonymous with oil as it helps power the profitability of your business.

With 43% of customers believing that they cannot adequately protect their personal data, more and more companies prioritize ensuring compliance with data privacy laws. Today, with increasing cyberattacks and companies like Facebook, Amazon, or eBay already facing lawsuits for cyberattacks, customers feel reluctant to share their personal data.

What is personal data?

Personal data is any personally identifiable information such as gender, security number, health records, web browser cookies, device ID, IP address of the phone, tablet, or laptop. Social media posts, search engine queries, and location data are other personal data that companies collect to monetize information.

what is personal data

After understanding what personal data is, let’s explore why this data is the most sought-after and why companies leave no stone unturned in collecting it.

Why do businesses collect and hold personal data?

From the moment a customer lands on your website to complete the purchase process, companies use different technologies to capture and analyze data for drawing meaningful insights from it. These insights allow you to make key business decisions. Some reasons for holding personal information are:

1.   Provides a deeper understanding of your market

When an app uses your location information to create customized advertisements, they don’t explicitly convey that a credit card company or a restaurant may buy that information to offers hyper-targeted products for services.

The company is collecting your personal information to gain deeper insights. The data gives them insight into how they behave online, triggers a customer’s purchase decision, defines their overall demographics, and identifies ways to improve customer experience.

Having sufficient information about your customers is a great way to tweak your marketing campaigns to better fit your customer’s requirements.

From enhancing the way you communicate with your target customer to optimizing your website to improve user experience, the personal data you collect works as a gold mine for your business.

2.   Enables personalization

Data collection and holding might seem intriguing and counterintuitive when only 10% of customers feel they have total control over their personal data.

But these customers want personalization when it comes to marketing. Through personalization, a company can provide marketing and product suggestions and communicate better with customers.

When you know what your customers are more likely to buy, you can offer products or services that a customer cannot overlook and ultimately close the sale.

Based on the personal data collected, you can create market segments for hyper-targeted marketing campaigns. For example, using personal information, you can understand the type of mobile customers prefer to use while browsing and offer a seamless browsing experience of your website. Or offer auto-completion of payment methods for customers who dislike punching their card details every time.

This can increase your bottom line in the long run and help you grow your business at a level you’ve always dreamed of.

3.   Enhances your marketing campaigns

With more and more customers connecting to the digital world, your digital marketing strategy is more important than ever.

If you are a business looking to enhance your conversion rate, outrank potential competitors, build a sense of trust among customers, and want to optimize your marketing campaigns – you need personal data.

It’s data that gives information on what’s resonating with customers. Data will also enable you to understand the marketing tactic and strategy that customers respond to and take inspiration to create a more effective and targeted advertisement in the future.

marketing campaign

When companies collect personal data, they aim to learn about buyer’s persona, products that interest their customers, their preferred social media platform, and much more.

Using this goldmine of information, you can create necessary improvements to enhance user experience and convince your customers to purchase.

4.   Improves customer database

Personal and behavioral data collected across disparate sources and at regular intervals helps build a robust and up-to-date database. It improves your lead generation strategy and helps in gauging the interest customers have in your company. When you collect their phone number, IP address, and even email address, you open doors of interaction for future products.

The rule is simple: the more information you have, the deeper insights you will gain. So, rather than spending dollars on acquiring new customers and generating leads, you channelize your resources on quality leads and customers who are just one step away from purchasing your products or services.

Also, with time as your database grows, you can analyze the changing dynamics of customer behavior and create marketing strategies based on the insights obtained.

5.   Conceptualize better services and products

One of the most important aspects of collecting or holding data is understanding the performance of your product or services. If your products don’t live up to its expectation, you need to make improvements. Using the personal information and other data that you collect, you can understand the areas where a gap exists and create products to fulfill it.

According to a research by Harvard Business Review, companies that collect and rely on data usually expect a better financial performance than those that ignore it.

For example, Netflix uses personal customer data and preferences to create blockbuster movies and shows. With Netflix analyzing a whopping 30-million plays a day to collect data for their predictive analysis, the company developed some record-breaking shows like House of Cards.

That’s the power of collecting data.

Additionally, data collection helps them identify underperforming products and services and helps in reducing the production of products or services that are no longer in demand.

6.   Increases customer satisfaction

Using a customer’s purchase history, review, buying pattern, and post-purchase feedback can help you create a customer-centric framework that offers a superior experience to your customers.


When you analyze the personal data collected and recommend products or services, your business may experience a higher customer satisfaction level and help to build trust with your company.

How can you collect personal data?

When your customers visits your website, collect data in the following ways:

Traditional cookies

Many companies, especially Facebook and Google, use cross-site trackers to follow customers from one website to another to capture their personal data. These traditional cookies work by putting a code in the browser that users unknowingly carry with them when switching between different websites.


Another method of collecting your customer’s personal data is using supercookies that are permanently stored in your computer and are impossible to clear from your browser. But with data privacy laws in place, your business cannot track users without their consent.


This is another type of cross-site tracker that captures the unique profile of your customer’s device for browsing or making a purchase. These fingerprinters collect various information such as screen resolution, IP address, and type of operating system or computer your customers use.

Session cookies

Unlike a cross-site tracker, a session cookie tracks the same-site scripts. It works by helping your customers remain logged in on your website or remember what they left in their cart – even after you close the browser.

Session replay scripts

Session replay scripts are one step ahead of the session cookies as it records everything your customers do on your website. What pages they visit and what products or services they browse before making a purchase. The personal data collected helps in understanding customer’s behavior before and during a purchase.

Changing the paradigm of collecting personal data

The core promise of personal data collection is to improve customers’ experience either by advertising the right product at the right time to the right customer or convincing a customer to make a purchase.

While data collection and holding data offer countless benefits, it comes with a sense of responsibility. With data privacy laws like General Data Protection Regulation (GDPR) and the California Consumer Privacy Act (CCPA), and others in place, you cannot collect or hold customer’s data as per wish.

From not keeping personal data for longer than needed to asking for tracking consent from customers to ensuring data security, adherence to these privacy laws is a must for every business looking to survive in this digital world prone to cyber threats. Also, your company may have to provide a copy of the personal information you collect about a customer.

As a result, collecting and holding data while being compliant with the data privacy laws is essential for building customer engagement and taking your business to another level.

Last but not least, use the personal data collected to create a website, app, or product that speaks directly to your customers in a way they prefer to be spoken.

How are you collecting customer data, and what benefits are you reaping from it?

Do tell us by commenting below.