Privacy As a Competitive Advantage 4 Case Studies on How Tech Is Building Consumer Trust
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Privacy as a Competitive Advantage 4 Case Studies on How Tech Is Building Consumer Trust Shifting consumer attitudes and new regulations have raised the stakes on personal protection. Today, privacy is more than a compliance concern—it’s a key opportunity for differentiation. This eMarketer Report gives a closer look at why this opportunity is especially true for emerging tech platforms and applications that rely on users’ trust to grow. presented by Dear eMarketer Reader, eMarketer is pleased to make this report, Privacy as a Competitive Advantage: 4 Case Studies on How Tech Is Building Consumer Trust, available to our readers. This report features eMarketer data, insights, and four case studies that illustrate how trust and privacy practices can fuel adoption, growth, and increase or retain market share. We invite you to learn more about eMarketer’s approach to research and why we are considered the industry standard by the world’s leading brands, media companies, and agencies. We thank you for your interest in our report and Adtaxi for making it possible to offer it to you today. Best Regards, Nancy Taffera-Santos Nancy Taffera-Santos SVP, Media Solutions & Strategy, eMarketer eMarketer, Inc. www.emarketer.com 11 Times Square, Floor 14 [email protected] New York, NY 10036 Privacy as a Competitive Advantage: 4 Case Studies on How Tech Is Building Consumer Trust Shifting consumer attitudes and new regulations have raised the stakes on personal data protection. Today, privacy is more than a compliance concern—it’s a key opportunity for differentiation. This is particularly true for emerging tech platforms and applications that rely on users’ trust to grow. Why are privacy and trust so important for tech Priorities and Actions in Protecting Their Privacy companies now? According to Consumers Worldwide, June Privacy is at an inflection point. Between growing market % of respondents demand, shifting consumer norms, and new legislations, tech firms recognize their product development and business models must adapt to address these concerns. Rebuilding % % % and establishing consumer trust will be necessary to drive adoption of the next wave of innovations. I care I'm willing to act I've acted I care about I am willing to spend I have switched How are leading tech companies differentiating data privacy time and money companies or themselves with privacy-protecting values and I care about to protect data providers over protecting others This is a buying their data policies product designs? factor for me or data sharing I want more control practices I expect to pay Big tech firms like Amazon and Facebook are taking privacy more concerns into account when developing new products Note: n=, Source: Cisco, “ Consumer Privacy Survey”; Insider Intelligence calculations; like smart speakers and AR and VR platforms. Apple has Oct , given users more information and control over how they InsiderIntelligence.com are tracked. KEY STAT: There is a market for privacy: While nearly nine What are the competitive impacts of tech’s privacy and out of 10 consumers state they care about data privacy, trust-building efforts? about three out of 10 consumers worldwide have actually acted on those preferences and switched providers over A solid privacy strategy can fuel user adoption, revenue their data policies or data-sharing practices, according to growth, and help companies increase or retain market Cisco’s 2020 Consumer Privacy Study. share. Likewise, breaches of trust and unmet consumer expectations around privacy open up opportunities for competitors. Contents WHAT’S IN THIS REPORT? This report features four case studies that illustrate how trust and privacy practices can 3 Privacy as a Competitive Advantage: 4 Case Studies on fuel adoption, growth, and increase or retain market share. It How Tech Is Building Consumer Trust also looks at how breaches of trust can open opportunities 4 Key Points for competitors. 4 Privacy and Trust: Essential Foundations for Emerging Technology Adoption 4 The Market for Privacy—Why Now? 8 Building Trust in Emerging Technologies Through Privacy: 4 Case Studies 16 Best Practices for Differentiating on Privacy 17 Editorial and Production Contributors PRESENTED BY: Copyright © 2021, Insider Intelligence Inc. All rights reserved. Page 3 Key Points The tech backlash rages on, and emerging tech products and platforms have some work to do to regain users’ trust ■ There’s a market for privacy. Consumer attitudes with their data, especially as new interfaces get smarter have evolved beyond the “privacy paradox”—the idea and more intimate on our bodies and in our homes. Tech’s that users’ stated preferences don’t always match biggest players understand this and are pivoting their their actual behaviors and choices. Privacy-conscious product development strategies to meet consumers’ consumers are willing to spend time and money to growing demands for responsible data management. protect their data and identify trustworthy companies. This report examines four cases that illustrate how tech’s ■ Tech companies should consider users’ trust from biggest players are establishing, maintaining, and even the start of product development. New behaviors, losing consumers’ trust with their data practices and privacy- interfaces, and devices—like smart speakers and centric product development. From smart speakers, to extended reality wearables—are changing norms augmented reality (AR) and virtual reality (VR), to messaging around trust. Tech companies need to keep user platforms, to the entire app ecosystem—these cases concerns and preferences in mind from day one of the illustrate how approaches to privacy and trust are becoming design process. strategic initiatives. The report also lays out best practices to ensure that privacy and trust are essential pillars of all digital ■ Communication is key to building trust. Tech transformation efforts. companies should respect their users by speaking to them in plain, transparent, and honest terms, as well as by allowing them to state their preferences and provide consent regarding the use of their data. The Market for Privacy— ■ Privacy and trust are foundational to any company. Why Now? These strategies apply beyond emerging tech platforms and companies; they’re part of any digital Consumer and privacy advocates have been talking transformation effort that relies on data and is built on a for the last decade about the tradeoffs posed by close relationship with the consumer. an economy fueled by data. For years, the “privacy paradox” has hung over this discussion—the idea that users’ stated preferences don’t always match their Privacy and Trust: Essential actual behaviors and choices. But concurrent forces Foundations for Emerging have now reached an inflection point, making privacy a Technology Adoption competitive differentiator. Shifts in the market demand for privacy, consumer norms, regulations, and product Shifting consumer attitudes and new regulations have design suggest that the time has come for technology raised the stakes on personal data protection. Today, companies to actually make progress in building privacy is more than a compliance concern—it’s a key consumer trust and differentiating on privacy practices. opportunity for differentiation. Consumers are not only becoming increasingly aware of data’s foundational role The Market for Privacy Is Here in the digital economy, they’re also beginning to make informed decisions about companies based on their Recent research indicates consumers are becoming more data policies and practices. discriminating about sharing their personal data online. Cisco’s June 2020 worldwide survey of consumers found that seven out of 10 consumers were willing to spend time and money to protect their data, while nearly three out of 10 have actually acted on those preferences and switched providers over their data policies or data-sharing practices. PRESENTED BY: Copyright © 2021, Insider Intelligence Inc. All rights reserved. Page 4 Priorities and Actions in Protecting Their Privacy Consumer Norms Are Changing According to Consumers Worldwide, June Consumers’ expectations and requirements around the % of respondents handling of their data are shifting. Consumer concern about privacy is steadily increasing, according to CivicScience, and an overwhelming majority of US adults are at least % % % somewhat concerned about consumer privacy. I care I'm willing to act I've acted I care about I am willing to spend I have switched Levels of Concern About Consumer Privacy data privacy time and money companies or According to US Adults, Q1 2020-Q1 2021 I care about to protect data providers over % of respondents protecting others This is a buying their data policies factor for me or data sharing 51% I want more control practices 49% I expect to pay 47% 47% 46% more Note: n=, 40% 40% 39% 40% 39% Source: Cisco, “ Consumer Privacy Survey”; Insider Intelligence calculations; Oct , InsiderIntelligence.com In February 2020, Consumer Reports similarly found that 45% of US consumers were potentially willing to pay for 13% 13% products like search in lieu of having companies collect, 12% 11% 11% share, or sell their personal data. While privacy isn’t the top societal issue that adults Q1 2020 Q2 2020 Q3 2020 Q4 2020 Q1 2021 worldwide expect brands to address, it’s still relatively Very concerned Somewhat concerned Not all concerned high on the priority list, according to Edelman’s 2020 Trust Note: 232,563 responses were obtained online during January 1, 2020-March