Study Suggests Data Privacy Efforts Can Be Rewarded with Customer Loyalty

A recent study suggests that companies willing to invest in data privacy may be rewarded by customer loyalty. IDN summarizes findings from Privitar’s 2020 Consumer Trust and Data Privacy Report.

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A recent study suggests that companies willing to invest in data privacy may be rewarded by customer loyalty. 


Privitar, an enterprise data privacy firm, recently released its annual 2020 Consumer Trust and Data Privacy Report. One eye-catching finding noted that found brand loyalty isn’t only about how much the consumer loves a company’s product or service. It’s also about how the company treats a customer’s data. 


One finding from the report said that 40 percent of consumers think the brand’s trustworthiness is most important when it comes to brand loyalty. Relatedly, almost a third (31 percent) respondents said the brand’s “commitment to protecting their data” is also important when deciding on whether they feel loyalty to any corporate brand.  


“The results of the survey affirm the growing need for brands to focus on building and maintaining this trust, starting first and foremost with protecting customer data,” said Privitar CEO and co-founder Jason du Preez in a statement. “As more businesses utilize the cloud to enable data-driven insights, a firm commitment to data privacy will help to ensure long-term loyalty, consumer satisfaction and shareholder value.”


He also noted the on-going global COVID-19 pandemic “has underscored the importance of the trust relationship companies and governments need to build with consumers in an increasingly digital world.” 

Finding #1: Businesses must drive data privacy action. Use data privacy to build better loyalty with customers.

When working with a business, 40 percent of respondents said they think a company brand’s trustworthiness is most important when it comes to brand loyalty. Almost one-third (31 percent) said protecting their personal data is also crucial to their loyalty to a brand. This is nearly equal to the importance of good customer service (30 percent), the survey noted. 

Companies rely on brand loyalty to keep their operations up and running. While often referring to affordable costs and personalization as a means of keeping business moving, many overlook the importance of instilling a more personal sense of trust within their customer base. 


Evenly matched up with the 30 percent of consumers who believe customer service matters most, the results prove that data protection is just as critical to keeping customers coming back for more.

Finding #2: There’s a disconnect between consumer sentiment and actions surrounding data protection

Near half of consumers (43 percent) said they don’t know if they’ve worked with a business that has been impacted by a data breach. Interestingly, some 42 percent admitted to only skimming the text of posted “privacy notices,” and more than one-quarter (28 percent) admitted to not reading “privacy notices” at all. 


“These findings point to the fact that when it comes to the management of their data, many consumers aren’t fully aware of how brands are securing their personal information. With this, businesses have a tremendous opportunity to make data privacy a differentiator and a way to build long-term loyalty,” Privitar’s summary noted. 

Finding #3: The Covid-19 pandemic is creating more data sharing opportunities. But be aware that consumers are still wary.

Despite the growing advancements on the data protection front, just over half of respondents (51 percent) said they are “still not comfortable sharing their personal information.” 


In specific, one-third admitted they are most concerned about personal data being stolen in a breach. Another 26 percent of respondents said they are concerned their data will be shared with a third party. 


When asked explicitly about sharing their personal healthcare data, only 27 percent said they would share health data for healthcare advancements and research. IN a finding related to Covid-19 health issues, 21 percent of consumers surveyed said they would be willing to share health data for “contact tracing” purposes. 

Finding 4: The upcoming U.S. elections and state legislation are driving consumer awareness of data privacy. So businesses might get ahead of the game.

In the wake of growing consumer protections for personal data (California Consumer Privacy Act (CCPA in the U.S. and GDPR in Europe), the survey asked respondents asked about the role government should play in protecting personal data. Almost three-fourths (73 percent) responded there should be more government oversight at the federal and/or state/local levels. 


Noting the lengthy time government actions can take, Privitar said: “While legislation can take years to pass, it’s important for businesses to overhaul their technology and processes now to quickly address consumers’ concerns and keep business running.”


Privitar’s latest study was conducted with market research platform Dynata. The survey included responses from approximately 1,000 individuals aged 18-65 from the U.S.