Big Data analysis has been opening up big opportunities for improving targeted marketing to consumers. But how is it affecting their perceptions of privacy? In a recent article in American Banker, Beyond the Arc CEO Steven Ramirez noted that simply having huge amounts of customer data doesn’t necessarily drive greater marketing effectiveness – it’s all in how you use the data.

“Retailers and travel providers use transaction data in their marketing initiatives. Banks already have the data, the question is if they have the data analytics capabilities and the strategic thinking to act on the insights.”

Steven Ramirez, Beyond the Arc

While collecting and analyzing customer data delivers marketing advantages, the increasing efforts to tap mobile devices and social media is beginning to raise privacy concerns with customers. Is big data marketing going to far?

By looking at a customer’s spending patterns, geolocation, analyzing social media posts, and other factors, businesses can “connect the dots and understand a lot about a person’s social network,” said Ramirez. It can even inform predictive models for marketing analytics. However, in some cases, customers feel it’s getting too personal.

Avoid the “big brother” effect of mobile tracking

Mobile geolocation data has played a huge part in bringing concerns to a head. Now, when customers walk into a bank or past a restaurant, welcome messages or discounted food specials are sent directly to their phones. How much is too much? When does the “creep factor” come in such that customers feel like they’re simply being watched?

One solution is to help ensure consumers feel like they’re still in control, with the ability to opt in and out. Apple’s iBeacons welcome customers as they walk into their bank branches—but they first have to opt-in for services like this when they install the app.

Be transparent

Above all, one of the most important considerations is how to generate customer confidence –so transparency is key. When capturing data, businesses should give customers a clear and accurate sense of how their information will be used. Help customers understand what to expect about the confidentiality or sharing of their information, and allow them to opt-in or out. In so doing, companies may build greater trust and customers may be more open to their targeted marketing efforts.