Consumer Data Concerns Continue to Erode Confidence

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By: Lanndon Lindsay |

Posted on February 12, 2019

The numbers are difficult to fathom when you get right down to them: 90% of all data in existence online has been created since only 2016, and every day, a further 2.5 quintillion bytes of data gets piled on top. People are ravenous in their consumption and production of information, and the amounts of consumer data that will be generated in the years to come is likely to eclipse any predictions we could possibly forecast. It’s no wonder, with the genesis of this digital universe, that consumers have started to question their data privacy and security as they drift along within its masses.

The more connected we all are, the more opportunities there are for growth, positive change, meaningful relationships – and all of the other great achievements that have hurtled technology forward in the first place, especially when framed in the context of loyalty marketing. But there’s also an increasing need for responsibility and stewardship, because consumer confidence seems to be eroding with every new headline.

The latest news about iPhone’s security loophole is a textbook embodiment about what frightens consumers about relinquishing data to the brands they yearn to trust. It’s not good news for loyalty practitioners, whose craft will rely more and more on successful strategies around data collection and personalized targeting.

It turns out that while most apps collect data, but for some consumers, even this comes as a surprise – there have been reports of companies recording every tap and swipe that happens while using iPhone apps. The brands in the crosshairs claim to mask sensitive and personal data, but there doesn’t seem to be any clear mechanisms to completely prevent this from happening under the current setup. And some companies have even implemented “session replay” technologies, allowing developers to view exactly how consumers are interacting with their phones through screen recording software.

Do customers have a legitimate cause for concern? Or is the media hubbub around the news an overreaction to useful marketing practices that will actually create better experiences for consumers? What we do know is that many of these practices have gone against Apple’s Terms & Conditions; apps that are submitted to Apple’s App Store must outline a privacy policy, but none of the apps that were reviewed in a report by Tech Crunch made the screen recording aspect clear. In response, Apple has began notifying developers to disclose or otherwise remove the code that tracks phone screens: “Our App Store Review Guidelines require that apps request explicit user consent and provide a clear visual indication when recording, logging, or otherwise making a record of user activity”, claimed an Apple spokesperson.

There are a few ways this story can play out from here.

There are a few ways this story can play out from here. On one hand, brands could simply correct the technical deficiencies, re-launch their apps, bolster their privacy policies and get back to business. Analysts wouldn’t be wrong to conclude that many consumers will still willingly and freely use these apps. But in the long-term, every time concerns over data & privacy create waves within the industry, attrition in consumer trust amplifies.

The solution, of course, is to respect consumer demand for transparency, and to understand that transparency itself is a means of shifting perceptions from exploitation to authenticity.  Being proactive means more than giving consumers the chance to opt-in: it means communicating with them the specific advantages of mutually-beneficial data sharing. “I think users should take an active role in how they share their data, and the first step to this is having companies be forthright in sharing how they collect their users data and who they share it with,” claims The App Analyst. If this paradigm shift doesn’t happen soon, the injury to consumer confidence with the brands they are loyal to might simply be too great to heal.

Lanndon Lindsay is a reporter at large for The Wise Marketer.