Thursday, September 02, 2004

Study: Clear privacy practices boost trust and online sales for Internet companies

My own personal experience backs up the findings of a study recently released from the University of California, Irvine. The number of consumers who care about privacy is growing and they are a relatively silent bunch. Rather than raise a fuss, they just don't complete a transaction if they aren't comfortable with how the company proposes to use their information. Proably what makes them the most uncomfortable is simply not knowing what will happen with their personal information.

PIPEDA requires that every business that collects, uses and discloses personal information in the course of commercial activities have a privacy policy that, among other things, gives a general account of how the business handles personal information. Principle 2 puts the onus on the business to inform the individual of the purposes of the collection. Not only is it the law in Canada, it is good business practice. If a growing number of your customers want to know, you better tell them. And don't try to produce screens and screens of small print, because they either won't understand all the legalese or they'll think you're being too clever and deceptive. Every business should have a privacy statement that they want customers to read and about which they can be proud. And, if you don't want to disclose a practice, you probably shouldn't be doing it.

Take a look at the release from the University of California, Irvine (which came to my attention via Science Blog and the IAPP Daily Dashboard).

Clear privacy practices boost trust and online sales for Internet companies, determines UCI study :

"Informatics professor builds Web-based template to assist Internet buyers and sellers

Irvine, Calif. , August 30, 2004

Internet companies can boost sales and build trust with online shoppers by providing clear and readily available privacy disclosures, according to a recent UC Irvine study.

"Surveys have demonstrated that online shoppers are concerned about their privacy, specifically about the confidentiality of the personal data they provide to Web retailers," explained Alfred Kobsa, author of the study and professor of informatics in UCI's Donald Bren School of Information and Computer Sciences. "To allay these concerns, many Web sites include a link to their online "privacy policies," which describe how the retailer treats the personal data of customers. Even comprehensive privacy notices that should reassure readers are, however, often written in a lengthy and legalistic manner, and in effect, hardly ever read by Internet shoppers."

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