Yahoo is facing a class action lawsuit from users who claim the company has used their data for profit. While that might be seen as a cautionary tale for retailers who send targeted offers to shoppers, data shows a different story. When surveyed, close to half of shoppers said they preferred receiving relative offers to privacy.
So what can explain the dichotomy? Framing matters when explaining to consumers what their data is used for. As shown in this graph from SDL, consumers like when recommendations make shopping easier, but don’t like it when companies use personal data.
One way to improve the consumer perception is to use implicit data capture vs. explicit. Instead of asking the consumer to enter information – which automatically implies data collection – consumers can gather certain information such as size and gender from past purchases.
Despite fears of privacy backlash, few retailers use implicit data collection. The majority of retailers place four to nine steps in their account sign-up process, which can be tedious and induce the wrong perceptions.