Cory is the Chief Operating Officer at BlueConica leading platform for customer data.
Globally, privacy and data protection legislation is flourishing. More than 120 countries now have national privacy laws. In the United States, new state laws, such as a recent one in Connecticut—appear frequently, while calls persist for a while comprehensive federal law regulate how companies collect, store and share customer data.
In addition to a rapidly changing data privacy landscape, major tech companies are bringing privacy to the forefront. Last year Apple introduced a pop-up window for iPhones asking users for permission to be tracked by various apps. Google plans to disable third-party cookies in its Chrome web browser by the end of 2024, and Facebook is working on a new method to display ads without being dependent on personal data.
These developments represent a major shift in the way companies use data to understand and interact with consumers. Meanwhile, consumers want control over who has access to their data and how much they want to share. There is also a proliferation of myths and misconceptions about consumer data privacy that make it difficult to separate fact from fiction.
Myth #1: People don’t care about privacy.
Companies have always collected data about consumers. But previously, there were no laws dictating what kind of data they could collect, and few consumers really cared about it. protect their data. That is all changing.
The scandal of 2018 involving Cambridge Analytica misuse of personal Facebook data played a huge role in informing consumers about how many companies were collecting their data. Today, 61% of consumers say they are concerned that their online behavior is being tracked.
While the willingness to share personal information and understanding the complexities of data collection and use may vary from person to person, it is clear that data privacy is really important to today’s consumer and should be taken seriously. For brands, that means embracing a comprehensive approach to consent management where consent is stored by purpose in person-level profiles and that data is automatically federated to other systems to meet consumer privacy preferences across different channels.
Myth #2: Privacy is a game where the winners have to win everything.
Many companies think that privacy is a game where the winners have to win everything. Either they can convince someone to share all their information with them, or they can’t. In reality there is a spectrum.
Most consumers have a shopping experience where they land on a website and are immediately asked for their email, or they download an app and are asked to give all kinds of permissions. But these kinds of aggressive data collection tactics are a mistake. Instead, companies should think about making these experiences more like a conversation, collecting consumer information over time. As more data is provided, their experiences should become more personal and valuable.
Myth #3: Privacy and personalization are at odds with each other.
As concerns about data privacy mount, research shows that: 80% of consumers are still willing to give their information in exchange for more value and better experiences. They just don’t like most companies’ current approach to relevance; nothing but 22% of consumers indicate that the information companies collect about their behavior improves their online experiences.
To personalize experiences without entering invasive areas, companies need to focus on three key pillars: transparency, meaningful choice, and real value exchange. That means being clear about what types of data they collect and how they are going to use it; provide consumers with a detailed choice of how much information they want to share and when; and ensuring that the trade-off between data and value is balanced and fair, so that consumers are willing to share more information over time.
Myth #4: Marketers are out of options.
As you throw your arms in the air in frustration over the chaotic, complicated privacy landscape that can be tempting, there are ways to move forward. Privacy regulations and the death of the third-party cookie create opportunities to increase the size and value of privacy-compliant first-party data. In reality, 76% of companies are now saying they are investing in a first-party data strategy.
Rather than simply collecting ever-increasing amounts of data, companies need to make sure they take advantage of the data they already have. Because first-party data is unique to every business, it can be used to create personalized experiences that no competitor can replicate. As such, companies must be willing to adapt their communications based on as much – or as little – data that consumers are willing to provide. That means leveraging the signals you get from consumers and what you know about their common buying journeys to deliver highly valuable and relevant messages at every stage of their journey.
Like it or not, data privacy will be the main topic in the next decade. Companies can either be dragged in against their will or be proactive. Rather than thinking about collecting data and offering personalization despite privacy regulations, companies should use privacy practices as part of their customer engagement strategy. The time for change is now.