As made evident by users flocking to messaging applications Signal and Telegram, following WhatsApp‘s revision of its data privacy policies last month, use of data by corporations remains a sticking point when it comes to trust. However, European perceptions of consumer data seem to vary.
According to research from Splunk, when given the choice of a more personalised service, over a free, generic service with non-targeted advertising, 50% of UK consumers choose the generic option, while just 16% prefer a data-driven, personalised service. When it comes to sharing information such as email addresses, however, 68% of Brits said they trusted their bank, compared to 60% trusting their partners. Germany, by comparison, was found by another study to hold the highest value for privacy, which is driven by preference for financial data to remain private.
In this Q&A, Splunk’s vice-president for EMEA, Frederik Maris, expands on the split perceptions of consumer data across Europe, as well as how companies can improve trust, and how employees can be better trained in privacy compliance.
Why are most UK consumers so hesitant about choosing data-driven, personalised advertising?
Data personalisation is a concept that consumers in the UK and worldwide often struggle to grapple with. Recent research we carried out has shown that exactly half of British people would prefer a generic service in place of an experience tailored by insights from data. I believe this stems from a place of concern around data privacy and a fear of invasiveness, which can override the benefits of having relevant and tailored content based on their activity appear more frequently. Admittedly, this is something that many advertisers and search engines are working to improve as they now have more control over removing ads and privacy settings are easier for consumers to control – however, I think for many it takes time to build trust, especially against a sea of online disinformation. The hesitance and/or confusion around data personalisation can very quickly turn to animosity if transparency around data usage is not upheld.
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Why are there cross-border differences in perceptions about data?
What we are seeing across Europe is not only cross-border differences in how consumers feel about their data, but also how businesses are using it as well. To compare the UK and Germany for instance, our research shows that 80% of UK businesses believe that data will help drive innovation and improvement, whilst for German businesses, only 68% felt the same way.
This reservation around embracing data is present in German consumers as well. According to a study by the Tech Policy Institute, German citizens place the highest value on data privacy of any country in the world, and they suggest that the reason for this is largely driven by extreme preferences for financial data to be kept private. Conversely, financial services is an area where UK and French citizens are especially confident in sharing personal data, such as emails, with 68% of people being more likely to entrust their bank with this information over their own partners, according to our research.
Therefore, we know a big factor in the overall perception of data is cultural attitude, and often finance can be the largest country differentiator here. Unsurprisingly money is, for most people, the most precious commodity that data can protect or expose. Again, looking at Germany, we know that they are much slower than other European countries in the uptake of cashless payments; even amidst the pandemic, Bundesbank statistics estimate that 73% of domestic transactions in Germany will be completed with cash. So yes, whilst we do see differences across countries in how they perceive data and digital solutions, we expect this gap to narrow as attitudes change.
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What can companies do to improve trust and transparency in regards to data privacy?
Transparency is one of the most important values that enterprises must build into their data strategy. The truth is that whilst audiences are becoming more data literate all the time, the differences in levels of understanding require a measured approach in how data usage is explained. Giving people control over how their data is used, such as contact information or addresses, has to be managed carefully. The hope is that we see more companies that deal with consumer data taking the lead in education on data privacy and working proactively to dispel myths around the handling of personal information.
How can employees be trained to manage privacy compliance?
It all comes back to creating a culture that respects the data that is being handled, and this is achieved primarily through education. Employees need to be constantly educated about company privacy policies, the reason they are in place, and the implications if they are not adhered to. Crucially though, this is a marathon not a sprint; employees need regular refreshes in education and training when it comes to privacy policies as this landscape is constantly changing.