Consumer confidence is key, and needs to be earned. Too many companies focus on short-term profits and data quantity instead of quality. The focus needs to be more on customer goodwill and long-term loyalty.
In a world of increasing consumer awareness, the risks can be reputation damage, slashed revenues and share prices, and customers deciding to shop with competitors that are taking the issue more seriously. In addition, hefty fines are a real risk as governments pass legislation that reflects the public sentiment.
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On the other side, companies that value their customers’ opinions — and their craving for data privacy and protection — will gain a significant competitive advantage.
Studies show that a majority of consumers are still data pragmatists who will trade personal information for certain incentives or benefits under the right circumstances:
- Collect the minimum amount of data needed to deliver on your marketing strategy and achieve business goals;
- Where data is collected, clearly highlight how it is used and where it is stored;
- Allow consumers more control over what data is captured and how it is used;
- Provide prominent options to opt out where possible — for instance, to unsubscribe from emails. Five to 10 years ago, senders tried to hide unsubscribe buttons somewhere in the footer or fine print. Today, understanding recipients’ concerns and wish for control over how their data is used, a lot of companies put the unsubscribe link prominently at the top of emails;
- Avoid too many tech point solutions as it leaves businesses more vulnerable to breaches;
- Employee education is key to ensure that a good privacy culture is reflected in everyday processes — data privacy is no longer just the job of the Privacy Officer;
- Do not share data with third parties unless you have explicit consent to do so.
No company’s strategy to address consumer concerns will be exactly the same as another’s, but every company needs to put data privacy and consent front and centre in everything they do.