In the ever-evolving world of eCommerce, building consumer trust and understanding intent is vital for online retailers’ success. However, by following the rapid growth tactics of Big Tech companies, many online retailers miss out on the advantages of putting privacy first and cultivating trust among their customer base.
As the market becomes increasingly competitive, building digital trust can be a key differentiator for online retailers but for this to be realised there needs to be a step change in the industry’s approach to data privacy.
Data privacy and consumer mistrust
Big Tech players have set the tone for how companies operate within the digital sphere, with tagging, tracking and targeting all essential parts of their business models. Unfortunately, these practices have also become embedded in eCommerce.
With 70% of consumers viewing such practices as invasive and 60% changing their shopping habits to avoid tracking cookies when online according to the Retail Trust Index, it’s clear to see the contribution these practices are having on growing consumer mistrust towards retail brands. If the sector continues to overlook such concerns from consumers and pursue hyper-personalisation and localisation through industrial levels of data collection and mining, the erosion of trust in the brand-customer relationship will soon be irreversible.
Whilst the introduction of GDPR may not have been able to usher in a new era of consumer protection and data privacy online like some have hoped, it has undeniably created a heightened awareness amongst consumers. Additionally, continued record breaking fines for the likes of Meta, Google and more for their GDPR infringements has only entrenched mistrust and suspicion about how consumer data is being stored and safeguarded when online.
Privacy is a positive
A recent McKinsey study found that almost 1 in 2 (46%) of consumers will consider another brand if the one they are purchasing from has unclear data privacy practices. Additionally, the study highlights that companies that prioritise data privacy and digital trust are more likely to see revenue and EBIT growth of at least 10% annually.
The benefits of a privacy first approach are clear to see and by adopting Privacy Enhancing Technologies (PETs) alongside transparent data practices, online retailers can realise them.
PETs embrace fundamental data protection principles: minimise personal data use to maximise data security and integrate safeguards to protect people’s private information. By utilising PETs and adopting a privacy by design approach, online retailers not only have the tools to navigate ongoing innovation and change in the tech landscape but meet heightened consumer expectations for data protection. However PETs are no silver bullet, those that see them as a workaround incoming government regulation or obfuscate practices to continue surveillance models will fail to rebuild digital trust. Only through a genuine shift in mindset that prioritises privacy can eCommerce regain consumer trust.
Fostering customer intent
Retailers that adopt a privacy first approach can empower their customers, providing them with control over their data and foster a long lasting brand-customer relationship built on trust. When customers feel empowered and in control, they engage more with brands and this in turn can propel sales for online retailers.
Online retail has long suffered in comparison to in-store shopping experiences, with 60% of consumers looking to shop-in store to avoid online tracking practices. Whilst online retailers can also achieve 4-6x higher conversion rates just by understanding consumer intent as much as an in-person shopping assistant would.
These two figures highlight the key relationship between consumer trust and intent. By fostering trust and bridging the gap between online and in store shopping experiences, retailers can boost shoppers’ intent to purchase and remove digital bottlenecks.
Through ethical personalisation retailers can have the best of both worlds. They can provide an online experience that mirrors their physical counterparts without undermining digital trust through invasive tracking. By implementing transparent and user-friendly tools, retailers can allow shoppers to customise their shopping preferences, opt-in or opt-out of personalised recommendations, and manage their data-sharing settings.
In the competitive eCommerce landscape, building consumer trust and understanding their intent is paramount for success. However, many online retailers have yet to tap into the value of building a robust privacy infrastructure. Recognising the detrimental impact of current practices on consumer mistrust, viewing privacy as fundamental to their relationship with customers, and understanding the role of digital trust in fostering intent to buy are crucial steps for online retailers to accelerate revenues and sustain growth.
For more such updates, follow us on Google News Martech News
ABOUT THE AUTHOR
Angel Maldonado, CEO at Empathy.co
Angel Maldonado has spent the last 20 years passionately developing and executing Commerce Search and Discovery solutions. Having studied Computer Information Systems at Liverpool University, Angel started his career working for Autonomy, where he helped clients on pioneering enterprise search projects for seven years before founding Empathy.co. As the founder of Empathy.co, Angel drives forward the product vision, innovation, and ethos of creating a company with truly organic values. Privately held with no external investors, cash-flow positive, and fast-growing, Empathy is free to focus on product, innovate and relentlessly pursue customer success.
Angel is an evangelist and enthusiastic communicator who regularly speaks at industry events. He likes to explore the future of commerce search, placing the importance on people, their emotions, and unpredictability, rather than data and processes, to create experiences that generate an emotional connection. That is transforming the interactions between consumers and brands across the trust.
A keen sea sport enthusiast, Angel plays the guitar and enjoys poetry and meditation. He’s lived in the US, Spain, and the UK and now splits his time between London and Asturias (Spain).