November 12th, 2015

Privacy in Pole Position

Why privacy is becoming increasingly important for everyone from CIOs to end-users.

Our clients are asking us for more and more expert advice on privacy. The most common questions are:

  • “We are an enterprise with a global footprint, how do we establish which regulations we need to comply with?”
  • “How to have a one-size-fit-all service when users are spread out geographically?”
  • “How much personal information am I allowed to collect and what am I allowed to do with the information?”
  • “Can I collect it without telling my users?”
  • “Where should information be stored and is the suggested solution secure?”

We now see the term ‘privacy’ used in the media numerous times a day which makes it impossible to overlook this shift in the digital landscape. There are a number of reasons that can explain this, but to really understand the increased privacy focus it’s important to look at what’s been happening in the world of digital over the last couple of years. These numbers paint the picture well:

  • The number of social media network users surpassed 2 billion users in 2014. (source)
  • Mobile devices are becoming pervasive. As an example, 64% of Americans own a smartphone in 2015 – that is 35% more than in 2011. (source)
  • Online behavioral advertising has become a major focus for legislators. Can you imagine that the first legislation in the EU was enacted in 1995, 20 years ago? In comparison, the first iPhone was introduced in 2007, only 8 years ago.
  • Any and all of recent data breaches. When Ashley Madison’s security was breached earlier this year, personal details of 37 million users as well as the company’s financial records got out.

For all of the latest breaches, see this data visualization from Information Is Beautiful.

Companies are collecting large amounts of information about the end-users of their services (which can be both employees or customers), because they understand the value of this information. The drivers behind the data collection can be understood by putting yourself in the shoes of both the companies and end users.

By leveraging data, companies can:

  1. Provide a Personalized Service or Offering to Their Users
    However, not everyone is successful with this. A recent study showed that 72 percent of users did not feel that online promotions or emails they receive resonate with their personal interests and needs, which means that there is still a lot of work to be performed in this area. (source)
  2. Improve and Adapt Their Services to Changing User Needs
    The fashion retailer Topshop combines customer-provided data, free available data from fashion blogs and social media together with existing data within its own databases when running predictive and descriptive analytics protocols to determine emerging trends within the highly competitive retail clothing industry. (source)
  3. Target Users in Order to Increase Sales and Drive Engagement
    An internal study carried out at Walgreens showed that customers who shop both online and in their physical stores spend 3.5 times as much as a customer who only shops at their stores. And customers who shop online, on their mobile devices and in their physical stores spend 6 times as much. (source)

On the other side we have our users who are willing to sacrifice their privacy for perceived benefits. The classic example of Facebook users who know that Facebook is collecting and sharing their personal information but are still using Facebook comes to mind.

However, a study done in the U.S. in 2014 shows that 92% of users were worried about online privacy and that 80% of users don’t use an app they don’t trust.

There’s also a growing concern that personal information may be stolen or misused and what companies really need to know about you. If you have just downloaded Windows 10 you may wonder why Microsoft is collecting your payment data, contact details and data about your interests?

The collection of personal information is inevitable and actually not necessarily the issue. But the challenge lies in a correcting the misunderstanding of regulations and best practices that are currently out there.

We help companies find the balance between collecting information and making sure that the user can trust them with their personal information through the implementation of privacy and security best practices. Feel free to contact us to discuss your next privacy initiative.

Agathe Caffier, Senior Counsel, International Operations and Privacy Specialist

Tags: privacy security

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