How Consumer Data Privacy Concerns Are Impacting Organizations

Do you know how your data protection practices and data privacy policies impact your business? Your company is up against a growing population of consumers who consider data privacy a critical factor when shopping for products and services. In 2019, RSA discovered that 45% of U.S. adults have experienced their personal information being compromised in the last five years.

As that number rises, consumers are more and more concerned about how companies manage and protect their data, just as much as the quality of their products and services.

How Data Privacy and Security Effect Consumer’s Buying Decisions

In a survey done by the Pew Research Center, they found that more than half of U.S. adults chose not to use a product or service because of privacy concerns. They also found that 21% of adults stopped using certain websites due to the amount of personal information being collected. It’s no surprise that this number is so high as KPMG found that 86% of consumers see data privacy as a growing concern for them and 40% don’t trust companies to ethically use their data.

The modern consumer is spending more time online and engaging with companies virtually. As digital use increases so do concerns of data privacy. Big tech is a breeding ground of data risk as platforms like Facebook, Google, and others collect vast amounts of data on individuals. Consumers are not blind to this data collection either, as it’s easy to see its effects through eerily precise targeted ads and sponsored content. This collection of data also leaves people feeling helpless, with the Pew Research Center finding that

Despite these concerns, three quarters of consumers feel that data collection is just a ‘necessary evil’ of using the Internet and enjoying digital services.

Data Privacy as a Selling Point to Drive Business

These numbers highlight the importance that companies should be placing not only on creating great privacy practices but also effectively communicating them to their customers. PwC discovered that there are four main factors that people use to determine if they can trust a company:

• Cybersecurity and data protection
• Treatment of employees
  
• Ethical practices
• Admission of mistakes.

When companies market their data privacy practices, care should be given in making them easy to understand and accessible to the average consumer. Making privacy a central part of the messaging to customers can also have a positive impact on loyalty. The Wise Marketer found that 84% of consumers are loyal to brands with strong data privacy measures.

Consumer Concerns after Data Breaches

But how do consumers react to companies when data breaches occur? RSA

found that 64% of people feel that when their data is hacked, the company is to blame, not the hacker. The Pew Research Center found that about the same amount of people believe that companies will not promptly inform them if their personal data has been misused or compromised.

Businesses that invest in and market strong privacy practices not only see more trust from their customers but also faster sales cycles, more efficient operations, and higher agility. If you are looking to grow your business and build trust with your consumers, now is the time to invest in privacy. Cloud-native platforms, like IDX Privacy Platform, that can quickly adapt and customize to your specific needs are the perfect solutions for mitigating privacy risk. Offering your employees privacy protection benefits, such as IDX Privacy, will also help protect your business while building more trust in your brand image.

Good data privacy is good for business beyond just protection. Investing in privacy today will lead to happier customers and greater growth.