Getting to know you
The relative anonymity that most consumers experienced just 10 to 15 years ago has all but disappeared.
Our personal photos are now documented on one social media site, our professional lives on another, and our 140-character thoughts on yet another. Our online information and preferences help fuel subscription services to deliver the movies, clothes and food that we want while also helping businesses offer more personalized and targeted services through loyalty programs.
This explosion of consumer data is creating new opportunities for businesses to understand, meet and even predict consumers’ needs. But it’s also creating new concerns around the privacy of consumers and their sensitive data.
Indeed, a recent Ponemon Institute privacy poll found that most consumers care about privacy and fall into one of two categories: privacy ‘sensitive’ and privacy ‘centric.’
The majority of consumers (63 percent) are privacy sensitive. They believe privacy is important, but don’t take steps to protect their data because they believe the appropriate privacy guards are already in place. Privacy-centric consumers (14 percent) care enough about privacy that they will change their behaviors or even forego something that is important to them out of concern for their privacy.
Meanwhile, less than one-fourth of consumers fall into a third category: privacy ‘complacent.’ These consumers are generally indifferent to protecting their privacy and don’t care if their sensitive data is shared or sold.
The fact that most consumers care about privacy shouldn’t be surprising; given the amount of information they’re sharing online and storing on mobile devices, the growing prevalence of Internet of Things (IoT)-enabled devices collecting personal data, and the high-profile data breaches that have struck corporations and government institutions in recent years.
Regulations Fall Short
Despite the explosion of customer data that’s being collected, stored and shared, governments have struggled with how to best protect consumers’ privacy.
This was exemplified when the European Union Court of Justice recently struck down a safe-harbor agreement between the European Union and the U.S. that had allowed European companies to transfer personal data to the U.S. The court determined the agreement didn’t meet European objectives for protecting Europeans’ privacy rights.
In the U.S., some laws have been in place for years to help protect consumers’ data privacy. This includes the Health Insurance Portability and Accountability Act (HIPAA) in the healthcare industry and the Gramm-Leach-Bliley Act in the financial services industry. Also, nearly every state has passed a law requiring organizations to notify people if their personal information has been compromised in a data breach.
However, this mix of different laws can be confusing for companies to follow and ensure compliance. Additionally, current privacy protection laws don’t apply to every industry, and breach-notification laws aren’t in place in every state.