Privacy notices, telling people how their data will be used, are becoming standard practice on many retailers’ websites. But they often do the opposite of their objective: instead of reassuring customers, they often scare them away.
This is the main takeaway from a recent study published in the Journal of Marketing Research.
Privacy notices generally describe how a company and its affiliates collect and use customers’ personal information, such as their physical address, email address, phone number, and device ID. Some companies simply describe how they share customer information with third parties, if any, or how affiliates may use personal data. Others go further by explaining why these disclosures are made, using language that explicitly tells customers that they care about the security of their data.
Although there is no standard format for privacy notices, Apple last year began requiring software developers to add a privacy label resembling a nutrition label to any app published through its App Store.
To determine how consumers respond to privacy notices, researchers conducted seven studies, collecting data from nearly 20,000 participants. Several experiments have compared consumer interest in making purchases on a website or app that does or does not include a privacy notice. The researchers also tested how changes in the wording of a review affected consumers’ willingness to buy.
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The findings challenge the idea that simply telling consumers their personal data is protected will make them feel more comfortable, says lead researcher Aaron Brough, associate professor of marketing and endowed research professor at Harry M. Reid at the Jon M. Huntsman School of Utah State University. Business. On the contrary, privacy notices can, ironically, make consumers feel more vulnerable – and could actually scare companies away – when they don’t include a message that the company cares about security and privacy. buyer confidentiality. “It’s like going to elementary school and seeing metal detectors and bulletproof glass,” he says. “Their goal is to protect you, but instead of making you feel safe, they might make you feel vulnerable.”
What’s helpful in guiding purchasing decisions, the researchers found, are “benevolence cues” – statements such as: “We care about protecting your privacy”; or “We respect you and promise to treat you fairly”; or “We are committed to protecting your information.”
Although such statements offer no legal protection, they help build trust by telling consumers that companies have good intentions, says Dr. Brough. In one study, people were more likely to purchase a product when a privacy notice included these cues than when a privacy notice did not include comforting language or when the privacy information was not readily available at all. available during the checkout process.
These takeaways are important because many companies don’t use benevolent language in their privacy notices. The researchers analyzed the privacy notices of 50 randomly selected listed companies on the Nasdaq stock exchange and found that this practice was not common.
Ms. Winokur Munk is a writer in West Orange, NJ Email her at email@example.com.
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