Australian businesses are failing to compete on trust
Data and privacy is an ongoing issue, but as DMPG managing director James Wawne argues, not enough Australian businesses are approaching it proactively.
A perfect storm is playing out in Australia. Bold, unilateral decisions by tech giants like Google, Facebook and Apple have sent marketers into a tailspin as they come to terms with the implications for tracking and retargeting individuals across the web. The halo effect draws attention, debate and awareness to an otherwise dry topic among consumers: privacy and trust.
Privacy and trust in Australia are what you might describe as ‘emergent’, or to put it bluntly, one in which Australia trails behind other developed economies including Europe and the US.
To find out why, we need only look at the report commissioned last September by the Australian Government on ‘Australian Community Attitudes to Privacy Survey 2020’ and its findings, which make for some pretty bleak reading.
The report from the government’s Office of the Australian Information Commissioner (OAIC) found consumers are uncomfortable with how Australian businesses use their data in ‘data-driven marketing’, with seven in ten respondents nominating privacy as a major concern for them, and nine in ten wanting more choice and control over their personal information.
There is no shortage of insight around what consumers want, with the same research citing 84% of consumers who believe they should have the right to ask a business to delete their personal information and 77% the right to object to certain data practices while still being able to access and use the service.
The research revealed the consumer appetite for privacy policies being easier to understand, with people wanting simple language (87%), a plain English summary (86%), and use of icons as visual prompts (73%).
Strong relationships depend upon trust and being trustworthy, a trait that – judging by the AIOC report – is clearly lacking. It’s time for Australian organisations to address current consumer dissatisfaction by doing more to respect privacy and build trust.
One of the primary factors for Australia lagging behind on trust is a shortfall in legislation and uncertainty around timings. Amendments to the Privacy Act 1988 could be revealed at any time, though a specific date on the current review has yet to be announced.
Over the next 6 to 18 months, I can foresee a situation similar to the General Data Protection Regulation (GDPR) in Europe and the UK, with businesses scrambling to interpret and comply with what will likely be demanding regulatory provisions.
In order to succeed during this challenging transition, it’s vital that Australian businesses shift from a compliance mindset to a competitive mindset when updating trust practices.
What are trust practices?
‘Trust practices’ can be defined as the information, mechanisms, and processes by which organisations empower individuals to understand and control their data. This includes the availability and intelligibility of privacy/cookie policies, the perceived openness and transparency around data practices and technology usage, consent management (explicit opt in and opt out), data access, data portability, and rights to erasure. Fundamentally, it’s about making the utility or ‘value exchange’ clear.
Trust practices are important because they facilitate ongoing collection and use of first party data. This data is the lifeblood of customer experience personalisation which in turn, sustains meaningful customer relationships.
While we might reasonably expect that the majority of Australian businesses are compliant with the relevant legislation (Privacy Act 1988), it does not necessarily follow that this translates into good customer experiences, nor a happy, trusting customer relationship.
Based on what I have seen to date, many Australian organisations appear to stop at compliance, possibly due to the absence of the more demanding legislative directives (e.g. GDPR). It’s high time that Australian businesses go beyond mere compliance and proactively help customers take back control of their data.
How can Australian businesses address the trust shortfall?
In order to address potential shortfall in trust practices, it’s helpful to consider a three phase approach. The first phase involves assembling a small working group with representation from key areas such as legal counsel, customer experience, data analytics and IT. Find an executive sponsor to provide a mandate for change, and where needed, secure funding for any work.
The second phase is a discovery exercise. Organisations should evaluate existing trust practices to determine the risk that they present to first-party data collection and actuation. Complete a technology audit and evaluate the key components of your current trust practices.
The third phase involves creating a roadmap for action to bridge any gaps and address any issues. This includes low effort tasks such as copywriting for privacy and cookie policies to make information intuitive; to mid effort, which might include redesigning layouts and developing bespoke content to explain key concepts; to high effort, including deployment and integration of consent management technology.
Trust practices are a huge area to consider, but as with any large task, it’s important not to overcook it on day one and get caught up by indecision. Competing on trust is an ongoing process that requires ongoing refinement and periodic reviews, and should evolve gradually over time. Improvements should be created and delivered continuously rather than released in one fell swoop. It’s not easy or even particularly exciting, but it’s vital for the health of any business.
Consumer awareness around privacy and expectations of businesses’ trust practices will continue to grow while legislators play catch-up. In order to compete on trust, Australian organisations need to proactively up their game – or risk falling further behind countries that are forging ahead with consumer empowerment.
James Wawne is the managing director of DMPG.
