Retailers failing to halt suspicion over data privacy

Retailers have been warned they face a massive battle to win customers’ trust after a report published today found that an overwhelming majority of shoppers harbour concerns over data privacy issues.

The study from Capgemini Consulting reveals that 93% of all consumer sentiment was negative when it came to retailer privacy, with data security and intrusive behaviour the key drivers of pessimism.

It based the results on a social media sentiment analysis of more than 220,000 conversations over six months and covering 65 large global retailers that collectively generate revenues of over a trillion dollars.

Story continues below

The company said that consumers worldwide remain “strongly dubious” of retailers’ privacy initiatives, with data security (76%) and intrusive behaviour by the retailer (51%) bothering shoppers the most.

Consumer scepticism grew when trigger incidents occurred, including updates of privacy policies during mergers and acquisitions, or regulatory inquiries into a retailer’s violation of data security policies. Technology perceived as intrusive is also met with high suspicion, including in-store traffic monitoring and facial recognition.

In contrast, personalisation initiatives undertaken by retailers across the globe have been largely well-received, although the sentiment remains much higher in North American than Europe.

But striking the balance between privacy and personalisation eludes most retailers, concludes Capgemini. Only 14% percent of retailers are perceived positively by consumers on both personalisation and privacy initiatives.

A significant number of brands also “actively antagonised” consumers, with nearly 29% of retailers leaving consumers dissatisfied with both their personalisation and privacy initiatives, largely due to intrusive loyalty programmes, excessive promotional mails, poor in-store service, or confusing opt-in/opt-out instructions .

Kees Jacobs, global consumer products and retail consumer engagement lead for Capgemini, said that a blend of trust, transparency and consumer control over data is imperative to customer experience.

“The deluge of hacks on retailers’ data and misdirected personalisation initiatives are having a dramatic effect on consumers’ trust. The advent of digital shopping and big data analytics promised a golden age for retailers, but many of the world’s largest brands are finding the reality of safeguarding and properly utilising this precious information very challenging.”



Related posts