Most businesses will begrudgingly comply with privacy laws in order to avoid fines and lawsuits. In fact, with over two dozen privacy laws already in place, non-compliance can be costly (starting at $2,500 per violation). In addition, businesses have received demand letters in the tens of thousands of dollars and have even been sued for tracking website visitors without their consent, violating the California Invasion of Privacy Act. With over a dozen proposed privacy bills, these compliance requirements are not going away anytime soon. However, it does not have to be all doom and gloom. In fact, a lot of studies have been published demonstrating the fact that caring about privacy can help businesses establish trust with their customers and lead to a competitive advantage.
Do consumers really care about privacy?
If you have been in the web industry or have owned your website for a while, you may be wondering: “do consumers really care about privacy?” The fact is that privacy was not on the minds of consumers for quite some time, they just input their information into an email subscription list, submitted contact forms, and were tracked through analytics and advertising pixels without a second thought. However, this all changed with the Cambridge Analytica scandal. The scandal broke in 2018, revealing that millions of Facebook users had their data harvested by Cambridge Analytica and used for political advertisements without their knowledge or consent. This scandal taught consumers that their personal information may not be as protected and safe as they thought it would be, that personal information submitted to websites can be used in ways they did not anticipate, and that companies could violate their privacy in egregious ways. The Cambridge Analytica scandal spurred the wave of privacy legislation that businesses are currently dealing with and increased consumer interest in privacy.
The following study results highlight the fact that consumers are concerned about their privacy:
- 82% of Americans and 79% of Canadians believe that data privacy matters more to them now than ever before;
- 74% of Americans and 72% of Canadians express worry about how companies handle their personal information;
- 52% of Americans and 42% of Canadians think about their data privacy on a daily basis.
Are consumers actually willing to change their purchasing habits based on privacy concerns?
While it is clear that consumers care about their privacy, are they actually willing to change their actions if they are concerned about privacy? While it may be shocking for some, yes, consumers are willing to change who they purchase from and where they submit their personal information based on privacy concerns. For example:
As you can see from the above, it is clear that privacy can be a competitive advantage in the sense that your business can have more inquiries and customers if it adequately demonstrates that you are concerned about the privacy of your customers and prospects. It is also important to remember the fact that as business owners, we are also consumers in our day-to-day lives as well. How willing are you to buy something from a cold caller who calls you three times per day offering goods or services that have nothing to do with your actual needs? How willing are you to read a marketing email from a company that you’ve never heard of whose email list you did not sign up for? These everyday violations of privacy are not just annoying, they also create a negative impression of the business, leading consumers to go elsewhere for their needs.
How can a business demonstrate a focus on privacy?
Knowing that privacy is important to consumers and that consumers are willing to make purchasing decisions based on privacy is important. But how do you actually translate this knowledge into concrete steps? The following actions will help you demonstrate that you care about privacy to your website visitors:
- Have an up-to-date, comprehensive Privacy Policy that includes all of the disclosures required by the privacy laws that apply to you and accurately depicts your privacy and business practices. A Privacy Policy helps demonstrate to website visitors that you are serious about transparency and that you can be trusted with the personal information that the website visitor will provide to you;
- Obtain consent prior to tracking individuals with tools such as advertising and analytics. This helps demonstrate to website visitors that you respect their privacy by giving them actual choices as to how they would like to interact with you. Ensure that your cookie consent banner provides an “accept” and a “decline” option and that users are not tracked unless they actually consent to such tracking;
- Do not opt website visitors into email or SMS marketing by default. Allow users to determine whether they would like to receive such marketing messages;
- Allow individuals to change their minds. For example, have an unsubscribe option on your email marketing and allow individuals to pull up your cookie consent banner if they have changed their minds about being tracked or receiving marketing emails;
- Avoid dark patterns. Dark patterns are designs and interfaces that essentially trick a user into making choices that they otherwise would not (e.g. agreeing to being tracked or opting in to a newsletter). Dark patterns are not only violations of privacy laws, but they also destroy trust as they trick the user into making choices that they otherwise would not make.
It is important to take the time to look through your website to ensure that these best practices are met so that you can demonstrate to your website visitors that your website and business is worth trusting.
