A rising tide of consumer awareness has seen data privacy become a key driver of brand reputation, creating measurable impact on customer acquisition and retention efforts
New research published by Zeotap, the next-generation Customer Data Platform, has revealed how data privacy can impact revenue through its potential to build or damage consumer trust. Showing that the real cost of data privacy done poorly is as likely to be in lost purchases as it is in regulators’ fines, over half (57%) of consumers said that they would cut ties with a company who contacts them via a non-consented channel.
The report, titled “The value exchange: unveiling the commercial impact of customer data privacy”, surveyed 3,000 consumers across the UK, Germany and Spain on their attitudes towards sharing data with companies they interact with, with the aim of understanding for the first time how far those companies’ data privacy practises can either enhance or damage their ability to acquire and retain customers.
Recommended AI News: Spectrum Networks Offers Cybersecurity Training for Organizations Using Microsoft Azure
The resulting data showed that consumers have developed an acute sensitivity towards data privacy: 60% of consumers have grown more conscious of the personal information they share with companies over the last year. Despite the best efforts of regulations such as GDPR, only 40% of consumers feel in control over how their personal information is used by the companies they interact with.
The impact of this rising level of sensitivity delivers both a warning and a call-to-arms for companies who handle customer data, as consumers showed that their impression of a company’s data privacy practises directly informs whether or not they choose to spend with them:
- Good data practice can be a competitive differentiator and a revenue driver. 62% of consumers are more willing to buy from brands who guarantee that their personal information won’t be shared with third parties – and 58% of them would be more likely to recommend that company to friends and family.
- Mistakes mean lost revenue. When consumers were asked what they would do if they were contacted via a channel where they did not provide consent, 57% of them agreed that they would cut ties with that company altogether.
Recommended AI News: Swisslog Healthcare Announces Updated Global Management Structure
“The study shows that data privacy is now much more than a statutory issue of compliance; it’s a question of brand reputation, differentiation, and, by extension, revenue.” said Projjol Banerjea, Founder and CPO of Zeotap. “For anyone less inclined to take data privacy seriously because the threat of monetary penalties has yet to materialise for them, this should serve as a wake-up call: the real loss is top line — customers who take their business elsewhere.”
The research also found that consumers have a keen awareness that their data is ‘the new oil’ to brands, with 35% believing their email address to be worth more than $100 to a company. However, there was good news here for marketers keen to protect their margins, in that consumers were as willing to share data in exchange for personalised experiences over discounts or free service.
The report builds on learnings from Zeotap’s ‘Data Secrets of Successful Marketers’ whitepaper published in late 2021, which showed that while 91% of marketers are confident in their approach to data privacy, many (30%) lacked the single view of customer consent that’s critical to safeguarding consumer preferences. The lack of consumer confidence shown in today’s report appears to support the hypothesis that many businesses still have far to go in earning the trust of their customers when it comes to data privacy.
Recommended AI News: SoundHound Inc. and VIZIO Innovate the Smart TV Experience with Voice AI
[To share your insights with us, please write to sghosh@martechseries.com]
Comments are closed.