While retailers understand the need to move towards increased first-party data collection and personalised shopper engagement, many remain concerned about building privacy-centric experiences that meet consumers’ growing demands for the responsible use of their data, the latest research from Wunderkind, the leading AI-driven performance marketing solution, warns.
Original research of over 100 senior retail executives in Wunderkind’s 2024 CMO State of the Union Report showed that over three quarters (78%) of retail executives are extremely or very concerned about increasing consumer apprehension around the collection and use of their personal data. And, among those whose brands do not use first-party data, 68% say that the main issue they have about doing so is growing consumer privacy concerns.
These privacy concerns are also being borne out by shoppers, with 80% of UK consumers saying they are worried about how their personal data is mined and used online. And while 93% of UK brands say they’re transparent with customers about how they use their data, only 40% of customers currently agree.
This ‘data trust gap’ isn’t only impacting consumers’ faith in brands and negatively impacting brand perception, Wunderkind suggests. It’s also influencing where shoppers choose to spend, with transparent data use and privacy playing a key role in the authentic retailer-shopper relationships increasingly demanded by consumers. According to a poll by Intellias, two-fifths (40%) of UK shoppers are more likely to buy from ‘trusted’ retailers, while a further study from Forter suggested UK shoppers would spend on average 44% more with brands they trust.
“In an era where privacy concerns are at the forefront of global discussions, the way retailers and technology providers work with handling consumer data has never been more scrutinised,” Wulfric Light-Wilkinson, International GM of Wunderkind, commented. “Recent announcements, such as Google’s decision to move towards an Apple-style model of giving consumers control over third-party cookies through explicit opt-in or opt-out options, highlights the importance of data privacy, but – perhaps even more importantly – also giving consumers choice and control of their own data when shopping online.”
“The transition away from third-party cookies is pushing marketers to innovate with first-party data collection and other privacy-centric solutions. While this shift poses challenges, it also opens the door to more ethical and sustainable data practices in the industry, paving the way for a new era of responsible marketing,” Light-Wilkinson concluded.
