How Does Data Privacy Impact Your Business? – Tech Tip for February 11, 2020
This month, we are taking a closer look at data privacy and exploring all the different ways it impacts companies. To better understand the significance of data privacy and protection, this week we are shining a light on some of the more serious ways that it can impact a business.
How does data privacy impact your business legally?
Today, data privacy is the norm. Brands in the US are starting to adjust their practices to comply with both General Data Protection Regulations (GDPR) as well as industry and state requirements. And this isn’t just a requirement for global companies who need to establish credibility. For organizations who only transact in the US, transparency in privacy policies is no longer going to be optional. And at present, there are still plenty of penalties for not complying with federal and state privacy laws. Should a US company fail to meet data privacy requirements, they run a risk of accruing fines, work stoppages, lawsuits or even a shutdown of their business.
But companies shouldn’t just worry about the legal and financial aspects of data privacy regulations. Public opinion about data privacy can have an equal if not greater impact on businesses too.
How does a consumer’s perception of data privacy impact you?
Data privacy is something that consumers expect from all companies. And that means that consumers are going to have their own opinions on what data protection means to them. For example, a customer could be unpleasantly surprised to learn that data about them has been collected or used in ways that were not explicitly stated beforehand. If they have reason to believe a company is misusing their personal information, they’re going to immediately stop trusting that brand. And oftentimes, that usually means they’re taking their business elsewhere, resulting in less opportunities and revenue for the company.
So how can companies avoid betraying a consumer’s trust?
Privacy consent is the key
Data is the currency that both consumers and companies use to provide access to better services and products. So, if you want to get the most out of your data, the path forward is to be proactive in how you protect company and consumer information. And a great way to do that is to be transparent and concise when you ask for permission or consent. Choose to protect customer anonymity by creating your own privacy policies and publishing them on your website. By thoughtfully safeguarding customer information, you’re able to build better customer loyalty and trust that will eventually lead to a stronger brand reputation and increased opportunities.
For a great read about how companies are approaching data misuse, check out BCG’s “Bridging the Trust Gap in Personal Data.”