Data privacy matters much more than you may think. If you run an online business, you need to know why.
What is data privacy?
Data Privacy is a component of data protection. Data privacy is about how the data a company has access to should be collected, stored, managed, and shared with third parties. It is also to do with complying with the applicable privacy laws of your country. Additionally, data privacy is about the public expectation of privacy; centring around any individual. So, the three key elements of data privacy are:
- The procedures for proper collecting, processing, handling, and sharing of personal data.
- Complying with data protection laws.
- The right of an individual person to be left alone and to have control over their personal data.
If You Want Happy Customers, Data Privacy Matters
Customers are demanding transparency and trust from online companies more and more. They want to know how their information is being used and have greater control over how it is being utilised. Privacy matters deeply to most customers, so if you want to gain customer trust and a good reputation as a trustworthy online company, and thereby increase your sales, it is crucial you are open about how you use customer data and the steps you take to protect it. If you can give customers greater control over how they enable you to use their data, that is even better. Customers are becoming smarter. They are actively researching things like data privacy policies of specific companies more and more in order to determine whether to make a purchase with an individual online business and they are expecting online businesses to provide identity theft protection.
Most customers are happy to share some information to make their online shopping easier. For instance, most customers are happy to share information like their locations and which social media platforms they use. But customers want other data elements to be completely protected and not shared with third parties. By caring about your customers’ privacy, you can ultimately grow a strong brand.
If You Want to Improve Your Brand, Data Privacy Matters
According to a report by Forbes Insights, 46% of organisations suffered damage to their reputations and their brand values after experiencing a privacy breach. That should go some way to show why data privacy matters to online businesses. When your online company transparently shows that it cares about its consumers’ privacy and consistently follows best privacy practices, your customers will trust your company and become emotionally connected to it. In turn, that will greatly improve your brand value.
If You Want to Avoid Massive Fines, Data Privacy Matters
When it comes to data privacy laws, you obviously need to ensure you follow the rules. If your online business does not follow the legal requirements for the locations in which you are operating, you will be breaking the law. In turn, that could cost your company tens of millions of pounds. For most businesses, it means going under. Furthermore, it makes starting up another business more difficult because investors and contacts will no longer have trust in you.
If You Want to Gain Advantage Over Your Competition, Data Privacy Matters
Finally, if you can demonstrate to your customers that your business truly cares about the way you collect, process, and share data, and is transparent about it, you will gain a significant advantage over many of your competitors. After all, many online companies are more interested in selling as much data as they can legally get away with and utilizing data for deeper marketing strategies; and that is why customers are so wary about which online companies they give their data to.
