No technology has ever had the capability of gathering information (with or without the user’s knowledge) as effectively as the Internet. No information technology has ever had the potential of targeting precise marketing demographics as well as the Internet. And no technology has ever been able to disseminate information as widely and quickly as the Internet.
For an e-commerce company, these capabilities are a shining promise. But for the consumer, Internet technologies spell out a great potential for abuse. To feel comfortable with Internet technology, consumers need to know how their personal information is used. Let's take a look at how Web site privacy statements affect customer actions.
This data is supported and expanded upon in the FTC’s 1998 Report on Consumers' Online Privacy . The FTC report broke its findings into Web sites covering the following subjects: commercial, children's, health, retail, and financial, as well as popular sites.
The most interesting disparity here is in the disclosure of how information is used, with 71 percent of popular sites freely telling customers how they use information, as opposed to only 14 percent of commercial sites. The Georgetown study (which was conducted a year after the FTC report) suggested that this trend has changed quite dramatically. In that study, 65.7 percent of surveyed Web sites posted statements explaining how collected information is used.
There are two likely forces responsible for this change. The first is the threat of government regulation if companies don’t respond to consumer complaints about privacy online. But an even more powerful force is the voice of consumers themselves.
Consumer concerns about privacy
Internet consumers are adamant about how Web sites should handle private information. This attitude is evident in The 10th annual GVU (Graphic, Visualization, & Usability Center ) WWW User Survey , as the following statistics show:
- 77.5 percent think that privacy is more important than convenience
- 71.5 percent think that there should be new laws to protect privacy on the Internet
- 84.3 percent said that content providers shouldn’t have the right to resell user information
- 90.5 percent believe that users ought to have complete control of demographic information
Other privacy surveys show similar results. For example, The BCG consumer survey , published by TRUSTe/BCG, found that 70 percent of users have concerns about privacy when making purchases online, and 76 percent of users express concern over sites monitoring their browsing on the Internet.
The power of privacy statements
- BCG Survey : 78 percent say privacy assurance will increase their comfort in providing personal information over the Internet.
- Harris/Westin Survey : 63 percent said they would have divulged information if the site disclosed clearly how the information would be used.
- NFO Interactive Survey : 69.4 percent of the 1,944 online consumers say they would purchase goods online if given assurance that their privacy was protected.
- AT&T Lab report : 84 percent of respondents said they would provide their ZIP code and answer questions about their interests in order to receive customized information if the data was confidential.
Online Privacy Alliance
The Privacy Page
Bruce Spencer is a freelance technical writer who has been working in the information industry since 1983 and writing about the Internet since 1995.