Let consumers know more about their privacy, Deloitte tells brands
Consumers trust brands with their data but direct sales pitches, inappropriate online marketing messages and being dishonest with data breaches can destroy brand value, Deloitte Consulting has found in its fourth Australian Privacy Index.
The survey, which comes as Facebook recovers from the fallout from the Cambridge Analytica scandal, suggested consumers have greater trust in companies that are transparent with their privacy policies but Australian brands were failing to capitalise on this.
Viljoen: Honesty will drive the future value exchange
Having examined the practices of 100 Australian brands and attitudes of 1,000 local consumers, the survey found most companies were failing to disclose they were sharing data with third parties with only 15% explicitly indicating they are sharing information.
Deloitte’s report also highlighted the complexity of collecting consumer data, citing the example of a voice activated food ordering service:
“Think of a consumer that orders food using a voice recognition device. What information is that consumer really sharing? Certainly not only food preferences and voice characteristics.
“That consumer is also sharing information including payment and billing information, geographical location, transcripts of their conversations with the device, interaction history and specifics about their hardware and software settings. Potentially, that consumer may also be sharing health information if the order specifies certain dietary requirements.”
Deloitte’s national cyber risk services lead partner Tommy Viljoen pointed out this complexity will see companies having to tailor their usages to their own specific needs: “Each brand will use this personal information differently. Some will commoditise it, others will use it to create a more customised experience. In either case, transparency with the consumer on how their personal information will be used and protected is critical.”
“Honest communication about which data is being used for what, and why, will be essential for future value exchange.”
Deloitte also found that brand loyalty is important for consumers, with 69% of respondents saying trust in the brand is the most important factor while benefits received, such as discounts, personalised service and rewards were not as critical when making a decision about sharing personal information.
For companies suffering privacy breaches, Deloitte found 76% of respondents said they would be more likely to trust a brand after a breach if the company was timely and open about the lapse.
Significantly, 90% of consumers said they expect to be notified if their details are exposed, however only just over half, 58%, were aware of companies’ legal obligations under the Privacy Act to notify consumers if their data was likely to be misused after a breach.”
Last week it emerged that CommBank lost confidential files covering nearly 20m accounts back in 2016, but has chosen not to go public on it at the time.
“As the relationship between brands and consumers constantly evolves, brands have to amend their privacy practices to meet both consumer expectations and regulatory change,” said Viljoen
“The increasing emphasis on consumers ‘owning and having control over’ their data is a seismic change to the status quo.”
