In an age of intense scrutiny towards brands, there is no longer room for missteps when it comes to handling customer data. Consumers are putting more value on their personal data than ever before and it’s become such a consideration that 67% of consumers leave sites because of concerns over how their data will be used.
Right now, the industry standard amongst brands and online retailers for privacy is not good enough. Businesses are still operating in the ‘Surveillance Economy” and developing privacy policies that whilst adhering to GDPR regulations, are ultimately focused on mining customer data. Consent forms are still far too confusing and hard to understand and as result brand mistrust is through the roof with 75% of consumers concerned about how brands use their data.
Too many brands and retailers believe there is no other way, that the benefits of enhanced customer understanding and insights is too great for them to leave behind these practices. However, there is another way, building customer relationships that are built on trust and transparency, can equally if not more so deliver for brands and businesses.
The current industry standard
Customer’s data has been viewed as a commodity available for sale with its collection dependent on mass surveillance. This transactional relationship has characterised consumer and brands interactions for the past decade with search engines like Google and social platforms like Facebook leading the way and retailers following suit.
For too long, brands and retailers relied on a tacit acceptance and to a certain degree of ignorance of their practice from consumers. However, both consumer attitudes and government regulation have shifted. The introduction of GDPR as well as notable cases of data misuse from big tech has drastically changed the landscape within which retailers operate. Now customers are not only far more aware and conscious of their data but are actively changing the purchasing behaviour dependent on brands data policy.
Brands have generally been slow to react, resulting in a growing crisis of consumer trust, However more recently corporations like Apple have changed their approach to privacy and businesses are preparing themselves for a ‘Cookieless World’ as Google looks to remove third-party tracking from its browser Chrome, signalling the long overdue move away from the Surveillance Economy,
Privacy-led strategies are taking centre stage
When the GDPR was first introduced, many businesses buried their heads in the sand. However, what was seen as an unwanted chore was actually an opportunity for many businesses to re-build consumer confidence.
The fact that websites continue to distort consent user interfaces, to lead consumers making specific selections regarding their data, is exacerbating the issue of consumer trust. Rather than continue to rely on third-party cookies and make piecemeal changes due to GDPR, retailers should look to make concerted progress in rebuilding trust.
As users are worried about the privacy of their personal data, businesses need to have a robust policy to tackle this issue. Adhering to data protection guidelines is a start, but retailers must go further if they wish to regain consumer confidence.
The current industry standard lacks the transparency required and will ultimately see consumers move away and their data with it. However, an ethical approach to consumer data shouldn’t solely be seen as a measure to prevent the loss of customers and their data, but to build and strengthen their relationship for the future.
Consumers are now far more engaged with and conscious of business ethics, and want to spend their cash with businesses that align with their own world view and morals. We’ve seen this shift in consumer behaviour in the retail space with customer views on sustainability and the backlash against fast fashion as one prime example but data privacy is equally pertinent. Retailers that take a stand and implement a transparent and ethical practice when it comes to their customers’ data will grab the opportunity to forge more meaningful and long lasting relationships with their consumers.
Brand trust means to be tracking free
The transition from the Surveillance to The Trust Economy will present challenges for brands. However, the principles of retail won’t change and there are still ways that businesses can connect with and understand their consumers. But only through transparency can they truly develop trustworthy relationships.
Now more than ever, brands and retailers need to be aware that this transition is a chance to rebuild the modern customer-brand connection – a chance for change. The reliance on third-party cookies was not only an issue of ethics but also highlighted a lack of ambition from retailers and brands to forge meaningful connections with their customers. They were never perfect, their precision was greatly exaggerated and they had reached the point of diminishing returns.
The idea that “personalised” customer experiences had to involve collecting personal data, had taken hold for the vast majority of the sector. However, AI driven systems can now provide actionable insights to improve the customer experience without jeopardising consumers data.
Embracing this new reality will be vital. Consumers will no longer tolerate the use and misuse of their personal data and those that cultivate customer relationships, based on transparency and trust, will drive long term loyalty and thrive.