The United States is one of a small number of countries lacking a comprehensive national data privacy law along with Syria, Libya, Sudan, and Venezuela. With the exception of the United States, all are currently involved in civil wars or experiencing major civil unrest, so it is no wonder the typical U.S. consumer is confused and frustrated by the federal government’s inaction on a broadly bi-partisan issue. While state governments have started to fill the legislative void, what appears to have been lost in the shuffle between governments and big business is the voice of the consumer.
The consumer data privacy problems that exist today are unsustainable, and they will get worse before they get better so understanding consumer concerns, and how a lack of data privacy has hurt them, will be key to companies protecting their consumer data and relationships. Recent research from the Pew Research Center highlights the practical realities and perspective of U.S. adult consumers who live in an increasingly complicated world. Here is what consumers are saying:
Have Consumers Been Hurt by Poor Data Privacy?
Without a doubt. The 2017 Equifax breach alone directly affected 53% of the U.S. adult population (click here to see if your data was stolen). In the last 12 months, 21% of U.S. consumers reported having had fraudulent charges on their credit or debit cards, 8% having had their social media or email accounts accessed without their permission, and 6% experienced a fraudulent attempt to open a credit account or apply for a loan. Consumers are rightfully paranoid and distrustful of those asking for their personal data. Companies need to minimize the risk to their consumers and have scripted action plans to minimize damage in the case of breaches or misuse of data.
Do Consumers Benefit from Companies Using Their Personal Data?
Not very much according to consumers. 72% of U.S. adults say they personally benefit “very little” or “not at all” from companies that collect data about them. This indicates either marketers are doing a poor job of communicating the value proposition, or that what marketers view as valuable to consumers is not a shared belief. While there are undoubtedly benefits associated with discounts and improved marketing communication relevancy, 81% of U.S. adults believe the risks of personal data collection outweigh the benefits. Marketers need to consider what data they are asking for versus the benefits to the consumer. From the consumers’ perspective.
Have Data Privacy Related Trust Issues Hurt Brand Relationships?
Yes. 79% of U.S. adults say they are “very” or “somewhat” concerned about how companies use their personal data. In fact, they have a higher degree of trust in the government’s use of their data than in that of companies. When you consider only 17% of U.S. adults trust the government to do what is right “just about always” (3%) or “most of the time” (14%)[1], it should be an eye opener for marketers. That is a very low bar that many companies fail to surpass.
It is hard to miss the headlines companies like Marriott, Facebook, Capitol One, Equifax, and Uber have made with their massive and egregious data breaches. So, it should be no surprise that 70% of U.S. consumers feel their data is less secure than it was 5 years ago. Moreover, they have little to no confidence companies will use their data in ways they are comfortable with (69%), let them know if their data has been stolen or compromised (65%), or that they will even do what their privacy policy say they will do (57%). Brands must build trust through words and actions.
How Do Consumers Feel About Data Privacy Legislation?
Dissatisfied, confused, and frustrated summarizes consumer feelings on the state of data privacy legislation. 75% of U.S. adults believe there should be more data privacy regulation than there is now. With 81% of Democrats and 70% of Republicans agreeing, data privacy appears to be one of the few remaining middle grounds in an increasingly politically polarized world. However, “more” does not appear to be the solution to the problem, but regulations that are comprehensive, consistent, and easy to understand do start to address their concerns. Marketers must consider terms of service and privacy policies as consumer touch points, not the private territory of the legal team.
Do Consumers Feel in Control of Their Personal Data?
Not at all. 81% say they have little or no control over what is collected about them, with only 3% saying they have a great deal of control. They are most concerned about what social media, advertisers, and companies they purchase from will do with their data.
This feeling of no control is exacerbated by the number of privacy polices they are asked to regularly agree to which are often lengthy, of varying content, and chalked full of technical terms leading to few reading them, and an even smaller number understanding what they mean. Only 6% of U.S. adults even claim they fully understand what companies do with their personal data and only slightly more (8%) say they understand privacy polices well. 57% report being asked to agree to terms at least weekly, so it is no surprise that only 22% report always or often reading privacy policies before agreeing to them.
For the consumer, this has created a feeling of being overwhelmed, confused, and without an understanding of where to start to even try to take back control. In practical reality, typical consumers would never be able to find all of their data, and all of the places it has been shared. Companies should make understanding their policies easy, give control to their consumers even where the law does not require it (yet), and create a consistent experience to do so.
Data privacy is a brand issue and only by listening to consumers will companies be able to fully understand it. The multitude of ways in which data is collected and used today is mind-boggling to the average consumer, and every day it becomes increasingly complicated. Recognizing and addressing this broadly deteriorating, yet increasingly important, element of the consumer experience will be critical for companies to understand and protect their consumers. It is time for companies (and the U.S. Congress) to listen.
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Sources: [1] https://www.people-press.org/2019/04/11/public-trust-in-government-1958-2019/
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