Our world has become increasingly dependent on technology, and the last year has underscored this dependence. In order to work — even simply to communicate — we have to be tethered to tools that collect our data and utilize it in unseen ways.
In this new data-centric society, we are unknowingly volunteering more personal information than ever while cybersecurity challenges loom ever larger. In light of this precarious situation, consumers are pushing back against online places and portals that have been proven to disregard their privacy in favor of more secure options. For example, anonymous search engine DuckDuckGo has been growing with a compound annual growth rate of more than 50% since 2017.
The confluence of these elements has created an environment in which we are hyperaware of the ways data is collected and used. The ship is starting to turn; consumers are expecting — even demanding — a lot more care when it comes to handling data. In fact, a Cisco survey noted 32% of consumers say they are now so invested in their personal data that they’re willing to take action against poor data privacy practices by switching providers. Similarly, we’re all making decisions according to how safe and how necessary the information we’re giving up is rather than indiscriminately clicking and scrolling.
It’s not that these “privacy actives” care so much about data governance that they’re thinking about it all the time. Instead, it’s that they see data privacy concerns as an extension of how brands think about them as human beings. In the Cisco survey mentioned above, 90% of people said they believe the way their data is treated reflects how a company views them as customers.
Will Consumer Privacy Laws Limit How Data Is Used in Business?
Stricter privacy regulations and increased consumer control over data will inevitably have an impact on data-centric companies’ operations, but will it hinder their ability to carry out their missions?
Here’s the truth: There is now a multitude of ways that companies capture data. From audience-driven databases to proprietary research and scraping, data comes from many avenues and is compiled and crafted into insights by marketers. With all these methods on the table, it is possible for brands to make a shift toward a more consumer-led, data-centric business model.
If brands can communicate with and involve consumers in using data to craft their services, they can actually make their relationships richer. Even privacy actives (or the consumers willing to make buying choices based on data governance policy) tend to be interested in trading their data for benefits such as increased personalization or better curation engines.
Will We See a New Kind of Tech Company Emerging?
If companies are incentivized to reevaluate their approach to data governance, they might be able to make their brand power stronger while handing more control to consumers and shoring up their data security and privacy.
But this reevaluation will not happen easily or overnight. Companies will need to shore up their understanding of how data flows through every node and process of their business model. They’ll need to rethink any tracking-based data sources they rely on and carefully set up controls for effective data governance. Considering the entire data lifecycle, they’ll need to start valuing consumer privacy beyond their own interaction with a piece of data.
If companies can change their data governance outlook, there’s no reason why consumers wouldn’t respond positively, propping up ROI from investing in data centricity.
Image by Wesley Tingey