As part of the buying process of most shops on the web (for discounts, early access to sales, updates on orders), signing up for promotional emails (or SMS alerts) is now part of a regular pattern within online shopping. Consumers typically share their email address (and/or phone number) without really thinking too much about it, as it would seem a fair exchange of their contact information to receive convenience and promotional offers.
However, what many users may not realize is that they are also creating potential data collection points through these ways of communicating.
Many of the systems that are used today for marketing are way beyond just sending a message. Campaigns sent through email or SMS are frequently done so through systems that allow for tracking of user engagement with those campaigns, including when an email is opened, clicked on, or viewed. Tracking this information allows companies to improve their ability to create future marketing campaigns; however, there are many questions about the collection and utilization of personal data in this manner.
An example of this concern is the Quince privacy investigation, which looks into how user data associated with transactions completed via email/SMS may be collected and stored. Users frequently do not consider that the interaction that they have with a promotional email or SMS would result in their activity being tracked, reviewed, or that their data (like email or phone number) would be shared with a third-party platform for further analysis.
An important point to consider is how data is collected by your sales force when they are collecting potential customer contacts. Not only will your sales staff collect basic contact information, but they are also gathering a wealth of data through behavioral observation, such as the user's actions after they click a link to visit your store or the way the user engages with your store over the life of the account. This data can then be used to create comprehensive user profiles for future marketing purposes.
The way in which third-party agencies are involved in managing the email and SMS marketing campaigns of many businesses has created additional layers of data processing that make it difficult for consumers to know how their data is being handled. Using third-party vendors provides greater automation and scalability; however, there are additional levels of potential security breaches where consumer data could be compromised outside of the business.
The Quince study indicates that there is a gap between consumer perceptions and actual consumer data practices. Most consumers believe that by giving their telephone number or email to a business, they are only providing permission to send messages. In reality, the consumer providing their personal information to the business is entering into a much larger data ecosystem that documents and tracks the consumer's behavior, which will eventually become part of the marketing effort of the business.
Transparency is essential in resolving this problem. Many companies provide information about data practices through their privacy policy or consent forms; however, users oftentimes do not understand how and under what circumstances they are providing this information.
It is important for users to consider these issues and take steps to limit their digital awareness. For example, they should be cautious to whom they give out their contact information, regularly check and adjust their privacy settings, and have an understanding of opt-in terms for services. Even little things such as reducing the number of subscription services they use or providing different contact information for promotional purposes can help limit users' exposure.
To retain users' trust, businesses need to provide value, as well as transparency. Companies should ensure that they communicate to consumers how data is collected, used and shared in order to bridge the gap between what the functionality is supposed to do and what a user expects it to do.
As digital marketing continues to advance, the line between communication and data collection will continue to blur. Incidents such as the Quince privacy investigation serve as a reminder that even simple interactions (e.g., signing up for a text alert) can have implications for the privacy of individuals.
