To find success in today’s consumer-driven world making data-based decisions has become the status quo. To create the personalized experience customers seek, the more data collected from consumers, the better. As a result, the fashion industry is becoming quite close to its customers, knowing them better than ever.
Despite consumer expectations for unique, personalized shopping experiences, consumers are showing a growing concern for privacy.
Deloitte offers insights on the consumer’s viewpoint on privacy, releasing a new consumer privacy in retail survey: The Next Regulatory and Competitive Frontier. In the report, nearly half of consumers (47 percent) said they “feel they have little to no control of their personal data.”
Consumers are willing to divulge personal data when they see a benefit. According to Deloitte’s findings, 71 percent of consumers would be more likely to share if told they would be receiving better pricing, special discounts or exclusive offers. When a customer does share personal information they also hold retailers to a standard, which then reflects the level of trust they credit to the company holistically.
For retailers, it becomes a fine line knowing how not to betray consumers’ trust.
“While some retailers have moved the bar on data privacy, there is still a lot of work to do. The retail industry should advocate for a consumer privacy standard putting consumer centricity at the core and trust as the guide,” said Rod Sides, vice chairman and U.S. leader, retail, wholesale and distribution at Deloitte Consulting LLP. “Transparency with consumers about what you collect and how you use it can go a long way in developing trust.”
Of consumers who are satisfied with privacy policies 73 percent said they are “more likely to be open or neutral about sharing personal data.” In contrast, 57 percent of consumers reported being unsatisfied or unaware. “The disconnect between how consumers perceive retailers use their data, and how it is actually used fuels the trust deficit,” Deloitte said. Further, 55 percent of consumers believe retailers will share, or sell, data to third parties. Meanwhile, retail executives shared the top three uses of consumer data are to increase operational efficiencies, to improve product selection, and to enhance in-store services.
“With increased scrutiny on consumer and data privacy, there is a call to action to define a new standard that works for consumers and retailers. Future leaders in data privacy should adopt guiding principles that align across the entire organization as an essential part of their strategy, culture and operations,” said Rob Goldberg, cyber risk leader of retail, wholesale and distribution at Deloitte. “Retailers should work every day to connect with consumers in a way that builds trust, manages legal risk and enables their growth strategy.”
Transparency for how data is used, Deloitte says, is a huge opportunity for retailers to build trust with consumers. When use of data goes beyond consumer expectations they feel retailers are violating access to personal information. “Retailers who focus on consumer privacy as a strategic growth driver are poised to create more meaningful data, enhance consumer engagement and reduce exposure to risk, all while staying ahead of the evolution of privacy in consumer business,” Sides said.
Beyond consumer’s increasing awareness of privacy threats, nearly half of U.S. states have engaged in the new privacy legislation (impacting 54 percent of the total population).
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