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Friday, 18 May 2018 11:04

Transparency on personal data use important to Aussies: study

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Transparency on personal data use important to Aussies: study Image courtesy of Stuart Miles at FreeDigitalPhotos.net

Australian consumers are more trusting about the use of their personal information by companies — particularly those offering digital goods and services — which are transparent about what they do with their data, according to a newly released privacy study.

The study, by accountancy firm Deloitte, reveals brands that offer primarily digital goods and services ranked better on transparency measures, with Information Technology operations the stand out rising from 9 out of 10 to number 1 on the index.

According to the annual assessment of the privacy practices of the 100 top brands, Australian consumers choose brands that are transparent about what they do with their data – and they want to know how their personal information will be used, and how it will be protected.

Deloitte national Cyber Risk Services lead partner Tommy Viljoen said: “Honest communication about which data is being used for what, and why, will be essential for future value exchange.

“Each brand will use this personal information differently. Some will commoditise it, others will use it to create a more customised experience. In either case, transparency with the consumer on how their personal information will be used and protected is critical."

The 2018 Deloitte Privacy Index considers the reality that as technology, consumer demands, and business models continue to evolve, brands are collecting vast amounts of personal information, which increases exponentially each year.

Viljoen said that each brand will use this personal information differently.

“Some will commoditise it, others will use it to create a more customised experience. In either case, transparency with the consumer on how their personal information will be used and protected is critical.”

David Batch, Deloitte’s new National Privacy and Data Protection lead, said there were some big changes in the sector rankings this year given the focus on transparency of personal information processing – hence the move to the top of the rankings by the Information Technology brands and those offering digital goods and services.

And Batch said that despite all the media attention paid to the financial services sector, “the good news for them is they stayed close to the top, ranking #2".

“Government, which is also highly regulated, came in at #3 on the rankings, and Telecommunications and Media was a close #4. The biggest fall was in the energy and utilities sector which fell to bottom of the list #10 from #4.

“We also asked 1000 Australians over 18 years old, across regions and genders, to tell us what data they provided to the brands in return for goods and services. And what factors influenced their decision to share their personal information. We wanted to understand the trust relationship and what factors influence the increase or decrease of consumer trust in brands.

“We also asked consumers to consider their knowledge of privacy and tell us how they would feel if their data was involved in a breach and what their expectations were for the brands to respond to such incidents.”

Key findings:

  • Sixty-nine percent believe that trust in the brand is most important when making a decision about sharing personal information, followed by the benefits received, such as discounts, personalised service and rewards.
  • Brands are more likely to lose consumer trust and damage their reputation if customer data is used for cross-selling of personal information (68%), inappropriate marketing (58%), and trading data to enable sales (54%).
  • Consumers are aware that their personal information may be shared with third parties and 41% are comfortable allowing a brand to transfer their data if they trust the brand and there’s a benefit for them.
  • Fifty-eight percent of consumers are unaware of the requirement by law to notify them of any data breach under the 1988 Privacy Act if their data is likely to be misused.
  • Ninety percent of consumers still expect to be notified if their personal details are involved in a breach.
  • Seventy-six percent of respondents indicated that they would be more likely to trust a brand after a breach if there was timely notification of the breach, a detailed explanation, detailed remediation plans, and ongoing notifications on progress.

Viljoen observed that,  “As the relationship between brands and consumers constantly evolves, brands have to amend their privacy practices to meet both consumer expectations and regulatory change. The increasing emphasis on consumers ‘owning and having control over’ their data is a seismic change to the status quo.

“This year’s Deloitte Privacy Index results clearly establish that trust and transparency play a vital role in determining the strength of any potential symbiotic relationship between the brand and its consumers.

“As the (former) Australian Privacy Commissioner Timothy Pilgrim said when commenting at the commencement of the Notifiable Data Breaches scheme: 'The success of an organisation that handles personal information, or a project that involves personal information, depends on trust. People have to trust that their privacy is protected, and be confident that personal information will be handled in line with their expectations'.”

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Peter Dinham

Peter Dinham is a co-founder of iTWire and a 35-year veteran journalist and corporate communications consultant. He has worked as a journalist in all forms of media – newspapers/magazines, radio, television, press agency and now, online – including with the Canberra Times, The Examiner (Tasmania), the ABC and AAP-Reuters. As a freelance journalist he also had articles published in Australian and overseas magazines. He worked in the corporate communications/public relations sector, in-house with an airline, and as a senior executive in Australia of the world’s largest communications consultancy, Burson-Marsteller. He also ran his own communications consultancy and was a co-founder in Australia of the global photographic agency, the Image Bank (now Getty Images).

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