We all read privacy policies don’t we? I suspect the answer to that from most people is a resounding ‘no’, or at best ‘not often’. Data protection directives and privacy laws vary greatly across the globe, but even if people understand what can or can’t be done with their information how many of us truly know how it is being used?
The focus was put firmly back on privacy earlier this month when the European Court of Justice ruled that the Safe Harbor agreement–which essentially lets organizations self-certify that they are providing adequate privacy protections when transferring data from the EU to the US–is no longer valid. [ http://www.theguardian.com/technology/2015/oct/06/safe-harbour-european-court-declare-invalid-data-protection ] The ruling comes in the wake of the accusations by Edward Snowden in 2013 that the US National Security Agency had gained access to EU citizens’ data stored by US tech giants, leading to ongoing negotiations over a new Safe Harbor agreement.
Such developments, together with high-profile stories on hacking of data collected by retailers, is having a dramatic impact on consumer trust. New research from Capgemini has found that many retailers are finding it a tricky task to walk the tightrope between personalization initiatives designed to tailor offerings to consumers, and privacy implications.
The report, Privacy Please: Why Retailers Need to Rethink Personalization, analyzed 220,000 consumer conversations globally across social media and found that 93% of all customer sentiment is negative when it comes to retailer privacy. Only 14% of the 65 retailers covered by the research receive positive consumer sentiment when it comes to both personalization and privacy initiatives.
It’s clear that organizations need to redress the balance between delivering more personalized services and putting better privacy measures in place to restore consumer trust. The Capgemini report outlines some of those measures, such as establishing transparent and thorough privacy policies and governance mechanisms that prioritize customer data.
One of the keys is to provide better communications around privacy in order to help consumers, of all levels of IT literacy, to understand how data is being collected, used and shared.
Together with the Consumer Goods Forum, Capgemini has outlined a new set of Consumer Engagement Principles to provide a framework for how retail companies engage with their customers. In the face of a growing trail of personal data, the Principles aim to help ensure constant and consistent communications with consumers across digital platforms globally and to engender greater trust.
If consumers can better understand and interact with those complex privacy policies, helping them to see how their data is being gathered and used, it could help to rebuild the relationship between retailers and their customers. In the end brands are all about trust and those brands that can be trusted with their customer’s data will be those that are most likely to thrive.