Brands lacking a privacy-first culture risk losing customer trust
New CMO Council Research Finds Marketers at the Epicenter of the Trust Economy and Customer Data Privacy
Warren Buffet famously said, “It takes 20 years to build a reputation and five minutes to ruin it.” This has never been more true when it comes to the sacred trust between customers and brands. Today’s customers are ready to flee brands that can’t keep personal data secure. Yet, too many brands risk losing customer trust in the face of massive data proliferation and rising attacks.
With so much at stake, marketers need a plan — and it starts with a privacy-first culture. Marketers will have to make hard decisions that cut across functional teams, create new policies and processes, and perhaps invest in new platforms.
Customer trust and data privacy go hand-in-hand, but too many marketers don’t understand what’s involved in this digital handshake — nor what’s at stake. A data breach can reduce a company’s bottom line to shreds and tarnish its brand reputation for years.
The sheer amount of personal digital data – from financial records to facial recognition – flooding corporate networks has customers ready to flee brands that lose their trust in keeping their data secure. According to the Chief Marketing Officer (CMO) Council’s new report, Exceeding the Requirements of the Trust Economy, a majority of global marketing leaders (57 percent) believe the most critical demand of the modern customer is data security, privacy and accountability.
The new report, produced in partnership with Akamai Technologies, points to the growing need for customer trust to influence every corporate decision and customer engagement across every digital and physical channel. It calls for marketing, IT, legal and operations to adopt a privacy-first culture.
There’s little time to waste, too. Among the trends driving the demand for a privacy-first culture identified by the report include:
Emerging technologies aimed at personalizing the customer experience, such as biometric scanners in retail and smart cities, increase the risk of data breaches
Marketers needing real-time personal data to meet growing customer expectations lack an understanding of data security, distribution and utilization: Just 36 percent of employees feel very confident in their knowledge of how to protect sensitive company information, according to a Dell end-user security survey
Customers are prioritizing data security and privacy: 87 percent of consumers said they will take their business elsewhere if they don’t trust that a company is handling their data responsibly, according to a PwC study
Attacks on corporate data continue to proliferate: From January 2018 through June 2019, Akamai recorded more than 61 billion credential stuffing attempts and more than 4 billion web application attacks
“Across all brands, a single truth emerges: Yes, there are hard process decisions that will require cross-functional teams and support, and even uncomfortable decisions that come with bigger price tags, but if conversations are not being held and new processes, policies and even platforms are not being considered, the impact could be catastrophic,” notes Donovan Neale-May, executive director of the CMO Council.
Brands with a privacy-first culture tend to be governed by ethics, the CMO Council report found. For instance, a retailer today might have the ability to install eye-tracking cameras in its stores to better understand an individual’s shopping habits, but will first consider the impact to consumer trust before green-lighting such a project.
Conversely, laggards wait for regulations, such as the Global Data Privacy Regulation from the European Union, to push them toward privacy actions. But this is a dangerous strategy, the report found, since customer expectations concerning data privacy are often higher than the current regulatory environment.
“Brands need to make it explicit that they are a privacy-first organization, implementing the proper governance and distribution of data across brands, channels and touchpoints,” said John Summers, vice president and chief technology officer at Akamai Technologies. “Fundamentally, customers want brands to treat them as an individual, knowing the value they deliver. In exchange, they will provide data in order to be met as an individual.”