- Marketers walk a fine when it comes to privacy, as 20% of global consumers reported they have abandoned or reduced their use of a brand over its data practices, according to findings from a new survey The Conference Board conducted in partnership with Nielsen.
- About one-fifth (19%) of consumers have switched to a competitor that adheres to what they perceive to be better data policies, the Consumers' Attitudes about Data Practices report found. Globally, 44% of respondents said they would forego personalized content, including brand messages, offers and experiences, if it would mean not having to share their personal information.
- Those figures are even sharper in the U.S., with more than half (57%) of consumers spurning personalization to preserve their privacy. As marketers adjust their strategies to account for policy changes from major platforms like Apple and Google and stricter data-privacy regulations, the research makes clear that they need to establish greater trust and transparency if they want to keep consumers engaged.
The Conference Board's report keys into a harsh reality for marketers that are already contending with a heap of complex data-privacy regulations, including the EU's General Data Protection Regulation and the California Consumer Privacy Act. The bottom line is that many consumers simply aren't interested in sharing their personal information with companies, even if doing so promises to unlock more personalized marketing.
With the deprecation of third-party cookies looming and a subsequent shift to focusing on first-party data acquisition, the findings reinforce digital marketers' jobs are bound to only get more complicated. Playing an educational role that illustrates the value exchange of data sharing could become more significant.
And cookies going the way of the dinosaur is just one piece of a broader sea change in the digital sphere. Next year, Apple plans to require opt-in consent for its Identifier for Advertisers, a randomly generated code the company assigns to devices that helps brands track the online activities of consumers to improve ad targeting. The policy has proved controversial in the industry, with many marketers believing the change will negatively impact their business — a concern The Conference Board's survey suggests is justified.
While data-privacy sensitivities are particularly sharp in the U.S., they should be a global consideration for marketers. The Conference Board and Nielsen surveyed over 30,000 consumers across 63 markets for their research, with a sample of 500 respondents per market. Breaking down the top anxieties around data, 45% of global respondents cited potential data breaches, while nearly 39% pointed to the potential for brands to share personal information with other companies.
Part of the skepticism could stem from a lack of transparency from marketers. Just 39% of consumers said they felt well-informed about how marketers acquire data and apply it to their business. The benefits of personalization similarly aren't always clear: Only about a third of respondents claimed sharing personal information had materially improved their life through greater personalization or convenience. Overall, many consumers (63%) simply view brands as the biggest benefactors of the data exchange.
Consumers are at the same time clearly willing to make the switch if they feel burned by a brand. Awareness of missteps could be heightened amid the pandemic, as people spend more time with digital media and shopping through channels like e-commerce.
"Consumers' digital engagement has skyrocketed during the pandemic, making transparency about data practices more important than ever before," Denise Dahlhoff, senior researcher at The Conference Board, said in a statement.
The Conference Board isn't alone in uncovering a tension where more tailored ads have rubbed up against climbing privacy concerns. The Interactive Advertising Bureau in February debuted an industry-wide initiative dubbed Project Rearc that seeks to address the growing conflict between consumer privacy and personalized advertising. In announcing the collaboration, the trade group cited projections that suggest wiping out personalization tactics could cost digital media companies $32 billion to $39 billion in ad revenue by 2025.