Consumer Safety and the Data Privacy Value Exchange

The UK public’s outcry and mistrust over its government’s efforts to build a coronavirus-tracing app is a microcosm of consumer data privacy issues. A timeline breaks down the months-long saga. To recap, the initial concept was to use Bluetooth technology to track device proximity. If a user who had opted-in tested positive for the virus and updated their status on the app, a signal would alert owners of every device that had been within a two-meter radius during the impacted timeframe.

One of the core issues was whether the collected data would be decentralized – similar to a privacy-preserving technology jointly launched by Apple and Google – or stored in a central database for use by the UK National Health Service (NHS) and “strategic leaders” (read: government officials) who claimed that the data was necessary for stringent monitoring of outbreaks. Promises by public health officials that the data would only be used for NHS care and research and that it would “be handled according to the highest ethical and security standards,” were met with a healthy dose of skepticism. A professor of security engineering at the University of Cambridge said, “I have 25 years’ of experience of the NHS … repeatedly breaking their privacy promises.”

Value Exchange

The potential trade-off between an increase in safety and security vis-à-vis lowering the threat of infection, and exposing one’s personal data to risk mirrors the value exchange that is top of mind for businesses in every industry that try to balance consumer rights with a personalized experience that drives new revenue growth.

In the 2019 Harris Poll survey commissioned by Redpoint, 54 percent of consumers said that they are willing to share personal data with companies to achieve a more personalized experience – with the percentage trending higher for younger demographics (72 percent for Gen Z, 70 percent for millennials).

The sharing of personal data, however, comes with certain expectations. In the Harris Poll survey,  40 percent of consumers say that it is “absolutely essential” that a company be transparent about what information is being collected, and how the information is being used (another 34 and 33 percent, respectively, said that it is “very important”).

And, if those conditions are not met, consumers will take their business elsewhere. In the same survey, a large majority of consumers said they’d be likely to abandon a brand if their basic personal information was hacked or compromised (89 percent), or if a brand sold their data for marketing/ad purposes without permission (86 percent).

Finding A New Data Privacy Equilibrium

Concerns are not limited to the abandoned rollout of the UK track and trace app. With both GDPR and CCPA raising data privacy concern issues to the forefront, the pandemic’s impact on data privacy is felt worldwide. What will retailers, restaurants and other businesses do with temperature check data, for instance?

In the US CCPA took effect in January 2020, with enforcement supposed to start the 1st of July. The California attorney general’s office recently said that coronavirus will not delay enforcement, despite pleadings from companies around the world. Rather, the office recommended companies be mindful of a “heightened value of protecting consumers’ privacy online” and the need for stringent data security.

Consumers, too, will have to reconsider the value exchange balance. If conceding to a temperature check before entering a mall is a requirement, will it turn customers away? Beyond the direct health connection, will consumers be more willing to share data for a contactless experience? For a seamless curbside pickup, for instance, will a consumer share their cell phone number so they can receive an SMS to alert them where to park, or to pop their trunk because an associate is coming out with their product?

Previous blogs in this space have covered the acceleration of digital transformation in the wake of COVID-19, from an overall perspective and its effect on the consumer healthcare journey. This unprecedented acceleration combined with rapidly changing consumer behaviours make data privacy compliance a top priority for brands today. Those that practice transparency and compliance, while demonstrating that they are using consumer data in accordance with an individual customer’s preferences, will establish trust. As we’ve seen from Harris Poll, trust is rewarded with loyalty, which translates to revenue growth.

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