Privacy Policies That Keep Everyone Happy. Do They Exist?
Personalization has been the single biggest product differentiator for more than a decade now and will continue to be so for most industries. But privacy as a differentiator isn’t far behind. Companies can set themselves apart by taking a privacy-by-design approach, being a leader in data protection and prioritizing users’ privacy.
Effective communication also goes a long way in building trust and customers do respond positively to awareness campaigns even when they only point out the basics. This is becoming even more important now that an increasing number of consumers wish for personalization and privacy to coexist together. In the same vein, privacy is a differentiation feature that an increasing number of consumers are willing to pay for. Recent studies show that consumers are willing to pay as much as 25 percent more for privacy-focused features. In fact, more than 40 percent of companies are seeing benefits at least twice that of their privacy spend. This makes one thing clear – consumers are far more likely to use and support services that help users feel cared for, secure and in control of their data.
What GDPR Taught the World?
GDPR was a key turning point for many consumers and helped them see privacy as an inherent part of the customer experience rather than an afterthought. It helped spark user interest in the privacy conversation and led to a global movement for transparency, safety, and accountability.
It taught users to think more critically when handing over personal data and to understand how that data is being used. In response to a more educated user base, companies are building privacy into their customer-facing applications (privacy by design) without changing the features and convenience that users have been accustomed to.
How Personalization and Privacy Coexist with Informed Consent
Personalization has been the single biggest product differentiator for more than a decade now and will continue to be so for most industries. But privacy as a differentiator isn’t far behind. Companies can set themselves apart by taking a privacy-by-design approach, being a leader in data protection and prioritizing users’ privacy. Effective communication also goes a long way in building trust and customers do respond positively to awareness campaigns even when they only point out the basics. This is becoming even more important now that an increasing number of consumers wish for personalization and privacy to coexist together. In the same vein, privacy is a differentiation feature that an increasing number of consumers are willing to pay for. Recent studies show that consumers are willing to pay as much as 25 percent more for privacy-focused features. In fact, more than 40 percent of companies are seeing benefits at least twice that of their privacy spend. This makes one thing clear – consumers are far more likely to use and support services that help users feel cared for, secure and in control of their data.Leading by Example: Creating Better Policies
We worked with one of our clients in the tech world conducting research into how users from different parts of the world understood privacy. Over the course of many years, we saw how user perceptions developed and changed across topics of privacy, data protection and consent. A common pattern we saw across countries was that while companies may have spent millions adapting their data policies, many users still did not fully understand the intricacies of digital privacy. This was more pronounced in other parts of the world, where data regulations are not as clear-cut as the EU. One way companies are navigating this is by building their policies around the most stringent privacy laws and using them as a standard. For instance, Microsoft applies California's CCPA regulations nationwide despite other states being much laxer – preemptively preparing itself for when other states inevitably catch up. We see something similar in the EU too, with Germany being the yardstick for what’s acceptable and what’s not. If German users find a privacy policy acceptable, then odds are so will the rest of the EU. Shifting gears, some companies are diverting resources to awareness campaigns, educating users about how their data is used. This ranges from explaining why they are being served certain advertisements to how product recommendation algorithms work. Others are taking a more minimalistic approach, simply collecting less user data and reducing their liability in the process. A growing number of companies are also leveraging users’ willing to pay for privacy features to add additional security and privacy protection. But most are taking the option in the middle – letting users customize the amount of data they consent to be collected through preference centers. At the end of the day, GDPR simply laid out the rules – receive explicit and informed consent from consumers before using any of their data. Now it’s up to the companies to decide how they will achieve this.
GDPR was a key turning point for many consumers and helped them see privacy as an inherent part of the customer experience rather than an afterthought. It helped spark user interest in the privacy conversation and led to a global movement for transparency, safety, and accountability.
It taught users to think more critically when handing over personal data and to understand how that data is being used. In response to a more educated user base, companies are building privacy into their customer-facing applications (privacy by design) without changing the features and convenience that users have been accustomed to.
