The impending EU Data Regulations reforms will make “privacy by design” a priority for all companies with European customers, and those with the largest data assets logically assume the most risk. It has become absolutely critical that the technology partners with whom organisations choose to work, prioritise privacy and data governance as core components of their operating ethos.
With British Airways recently announcing a possible breach of their frequent flyer account system, we are reminded once again that digital privacy is a fragile construct. As technology and user generated data becomes more ubiquitous, data privacy concerns among consumers and businesses is soaring. A spate of recent high-profile hacks this year – at BitDefender, British Airways and Ashley Maddison to name just a few – has exposed the vulnerability of customer and company data and the serious consequences of not properly safeguarding it.
Just last month popular antivirus vendor BitDefender was targeted by hackers, which attempted to blackmail the company on Twitter, releasing some login credentials for Bitdefender employees and asking for $15,000 in ransom to not reveal customer information.
The British Airways attack saw hackers access tens of thousands of frequent flyer accounts. Some members of BA’s Executive Club took to message forums to complain that their accounts had been breached and that their Avios reward points had been ransacked.
The consequences of a data breach are both reputational and financial. For example the online dating website Ashley Maddison could face fines of up to £500,000 by the Information Commissioners Office (ICO) if it has failed to delete user data as agreed with customers, following hackers claiming to have stolen information about the 37 million accounts registered on the service in July of this year. But now, data protection will have to become a standard part of compliance as heavier sanctions are proposed for security breaches, with fines ranging from €100,000 to €1bn or possibly 2% of annual worldwide turnover.
Eighty seven per cent of consumers believe adequate safeguards are not in place to protect their personal information, according to research by Accenture. Another separate report by Harris Interactive found eighty nine per cent of customers who have an unsatisfactory experience will take their business elsewhere. These insights demonstrate the problem is twofold as not only is trust in brands that hold personal data eroded, but once gone it can prove extremely difficult and expensive to win back.
Although consumers do continue to entrust brands with their personal data, eighty-three per cent claim they are more likely to give their business to companies they trust will use their information appropriately, according to research from GfK.
The ability of a business to keep its customer data safe is increasingly becoming a differentiator, with consumers preferring to engage with businesses they feel will adequately protect them and their personal details. It’s not just about giving consumers a way to opt out of targeted advertising. It’s about giving them choice, control, and transparency over when and how their data may be used. It’s also about giving businesses the tools they need for responsible stewardship and protection of consumer data.
The rise of data management platforms like Krux is meeting a growing need for brands to house, sort and activate the large volumes of first and third party consumer data they are amassing. DMPs do not buy or sell media or data, but are the piping that moves data from one place to another, intelligently, securely and in line with market regulation.
It is absolutely critical that the technology partners with whom organisations choose to work prioritise privacy and data governance. There are several options to illustrate this commitment, for example Krux recently underwent a very thorough examination of our data practices and were awarded the ePrivacyseal seal, which is awarded following a technical and legal review to ensure data practices comply with German and European data protection laws.
The emergence of the consumer web has given rise to a new normal. Portable computing, always-on communication and universal network connectivity have transformed people’s expectations and reshaped how they conduct their lives. When it comes to interacting with businesses, people want information that is relevant to them. And they want it now. On whatever screen they happen to have in their pocket or bag.
An inversion of the business world is upon us. People Data Management systems, a new class of business software, will help companies succeed in this new normal. It will deliver what people want anytime, anywhere and in any context, while respecting their right to privacy and choice.