Thursday 29 September 2016

Privacy & Security – The New Drivers of Brand, Reputation and Insights

It seems there’s a new story about privacy and security every day.  From consumer’s personal data held by a company being ‘hacked’ to the erosion of privacy through the collection and exploitation of personal information by Governments and businesses.  Privacy and security is an issue that’s here to stay.

So it’s perhaps no surprise that a new study by Edelman into consumer perceptions around these issues has identified some large and growing trends that businesses – from banks to grocers, from mobile phone operators to hospitals – should take heed of.

The study, Privacy & Security: The New Drivers of Brand, Reputation and Action Global Insights 2012, found that 70% of the consumers surveyed globally were more concerned about data security and privacy than they were 10 years ago.

The growing trust gap

Furthermore, 68% agreed that, ‘consumers have lost control over how online personal information is shared and used by companies’.  This strongly indicates there is a significant trust gap between consumers and the businesses that take, store and use their personal data.

This is again highlighted by the fact that 84% of respondents thought that the security of their personal information is important when shopping online – which is in stark contrast to the mere 33% who trust online retailers to protect it.

That’s a whopping 51 point gap!

Breeches change behaviour

Indeed, data breaches affect consumers’ behaviour enough to prompt them to change provider if there was unauthorised access to personal information.

Financial services tops this list with 80% of people saying they would likely switch bank because of a data breach.

This is no surprise.  As recently as January this year, Australian Securities and Investments Commission told clients of online stockbroking firms to review their accounts after it discovered several had been compromised.

Interestingly, 77% of respondents would also switch online wallet services and 67% would switch their online social media network.

Loyalty schemes

It appears that people are also becoming more reluctant to participate in loyalty schemes that hold personal data – such as FlyBuys, Myer One or Woolworths’ Everyday Rewards.  The survey reveals that one in five adults now refuse to join shopping loyalty programs and one in ten adults choosing not to bank online.

These are relatively low percentages of people who are choosing to opt out, but with the seemingly ever-increasing amount of personal data being collected and stored by organisations, it could become a growing trend.

Social media amplification

Certainly, all companies must now seriously evaluate their data privacy and security policies to ensure these issues do not erode or demolish the trust and reputation they enjoy from their stakeholders.  As we know in this age of social media, (bad) news travels fast.

In fact, the survey found that following a data breach, 39% of people told a friend about it and almost a third of people surveyed posted online about it.

Now is the time to take the necessary steps to implement policies, procedures and protocols ensure that your next data loss or privacy issue won’t become the next trending story.

The infographic below illustrates the main highlights from the research.  You can also read the full study here.

 

- Grant Thomas

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