If you’re running a business, chances are high that you’re collecting mounds of data about your customers, including their age, gender, interests and more. And when you take that business online — whether it’s building the next Facebook or developing an app for iPhone or Android — that data can be leeched with the users consent the moment they sign up for your service. By reviewing the numbers you’ve aggregated, you can tweak your product or marketing campaigns to improve your business and the user experience. But if customers suspect you’re using their data in less-than-desirable ways, they may lash out and possibly stop using your product.
What’s a data-driven business owner to do? With users across multiple platforms and services bemoaning the death of Internet privacy, especially on social media, it’s difficult to know where the line is drawn when it comes to overstepping small data.
Address the Issue
According to Shane Green, CEO of digital identity management firm Personal, businesses don’t have to abandon all data collection efforts and retreat into a pre-digital existence just to get rid of the problem. Instead, the key to handling customer’s data is simple: be transparent. Tell customers what data you’re collecting, why you’re collecting it and what you’re going to do with it. Or else.
“Too many sites — the vast majority — have not made it easy for the consumer to understand what data or information is being captured about the individual,” says Green. “They look at the consumer as being passive or uninformed.”
Green believes that a consumer revolution is taking place that will result in more informed and empowered customers. As more people begin thinking about how companies are collecting and using data, businesses that aren’t upfront about the ways they use customers’ data will face their wrath — and customer flight.
“The consumer’s got to be ‘in on the joke,’ so to speak,” says Green. “They need to understand why data’s needed, how it’s being used. Now that our lives are so connected and we see this constant flow of data in both directions, it’s very clear to us that trust is going to become a critical piece of that data flow. And I think that transparency equals trust.”
Green believes it’s essential for companies to start being transparent about data before the issue becomes any more mainstream than it already is. If a brand starts early, says Green, they can build a reputation for transparency that earn win them the good will of their customers.
“Companies don’t want to end up in The Wall Street Journal as one of biggest abusers of customers’ privacy — this is a ticking time bomb,” says Green. “I think people are going to respond to [transparency] with a deeper and more positive feeling toward that brand. You don’t want to look like the company that’s being dragged kicking and screaming into a transparent world.”
It’s also hard to gauge how your audience feels about your data collection before they begin to resent it — what’s the consensus of users on online privacy and data collection? Green sees two distinct philosophies that have emerged regarding customer’s data privacy: One group that’s “sort of surprised” data collection practices aren’t out in the open, and another, louder group that’s been against the practice of data collection in general.
To Green, that latter group sounded like they were “against progress.” Instead, Green says that data collection is the future of business and economic growth — but it has to be transparent.
“I think there’s a growing community committed to model we’re subscribing to at Personal — safe, secure and transparent data collection,” says Green. “You’d never share anything if you thought the data was going into the ethos of the Internet to be sent anywhere to do anything and to be read by anybody.”
In short, there’s no reason to halt your small data collection. Instead, be open to having an honest conversation about what you expect to get from your users. If you do, your audience will be more likely to stick around for the long haul.
How do you think businesses can be more transparent with their data? Sound off in the comments below.
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