Consumers Weigh in on Data Privacy and E-commerce as Economy Re-opens

COVID-19 forced consumers into the digital world like never before. Global online content consumption doubled in 2020, with American e-commerce spending increasing 32.4% from 2019.

Last spring businesses scrambled to adjust to this drastic change in media consumption and purchasing, and not all of them survived. Now, as the American economy re-opens, how consumers will adjust, and how businesses can avoid another mad dash to keep up is the big question.

A new survey from Adtaxi helps track consumer digital habits and preferences in this period of transition, and gives some key takeaways to help businesses and marketers serve post-pandemic preferences.

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E-commerce and Small Business

More than half of survey respondents (54%) reported that the pandemic has “permanently changed how they shop.” This means that for millions of consumers, e-commerce has cemented its role in everyday life. But Amazon and other giant e-retailers won’t be the only ones to benefit.

63% of respondents also said that they will prioritize shopping at small and local businesses moving forward. This is the continuation of a trend that Adtaxi has been tracking – in fall 2020, 74% of survey respondents said they planned to shop small and local for the holiday season.

The embrace of e-commerce on one hand and conscious consumerism on the other is not an inherent contradiction. Instead, it’s an opportunity for small businesses to confidently invest in their digital offerings and tap into new audiences in a way that may never have been possible pre-pandemic.

The survey indicates a few specific ways to meet e-commerce shopping preferences and help avoid cart abandonment. Shipping is a top priority for consumers, and 73% of online shoppers surveyed said they prefer when the cost of shipping is rolled into the price of a product, rather than charged as a separate fee at checkout. Framed another way, 96% reported that free shipping is important to them when online shopping. In addition, 93% said the same for a no-cost return policy, while 74% value loyalty rewards and 70% value same or next-day delivery.

Data privacy

The increase in time spent online has been accompanied by growing concerns over data privacy. Though digital habits will be more ingrained post-pandemic, so will expectations for transparency in data collection.

This is most clearly and recently reflected in Apple’s iOS14.5 update, which outlines what information is being collected by apps that are downloaded and empowers users to opt out of sharing their data. As a result, one of the biggest questions for marketers has been how users will respond as this could significantly limit the ability to serve targeted ads, degrade the consumer experience while on the apps, and decrease ad revenue. Though these are still early days, the survey gives some insight into consumer sentiments.

An impressive 54% of respondents said they were aware of iOS14.5’s new privacy opt-out options intended to strengthen users’ privacy and transparency. Among those who completed the survey on an iOS device, the number jumps to 65%. As for how many will opt-in to data tracking? Forty-five percent said they generally give permission when apps or websites ask to collect their data.

This popular turn toward ethics in data collection is not bad for digital marketers or ecommerce businesses. This increased transparency magnifies the value exchange for convenience.

Consumers are increasingly aware that ads contribute to their ability to access apps and websites for free. Now with more control, consumers may pay closer attention to what personal information they are willing to provide in order to have a better online experience. For brands, customer experience should be a primary focus, more so than ever before. Already, 44% reported their online experience is better because companies collect their personal information. Though this is less than half of respondents, it indicates a strong foundation.

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The work ahead

Building out consumer trust is essential for success in the increasingly e-commerce heavy future. But it will require serious commitment.

Sixty percent of those surveyed believe that companies are not working hard to protect their personal information, and 72% said that companies’ online data privacy disclosures are purposefully misleading.

The survey also suggests a general lack of education among consumers about their data and how it is being used. Of the types of data respondents said they are most comfortable sharing, the top ranked was contact information (44%), followed by sensitive information such as race or religion and location (both 27%). Purchase history came in at 19%, with browsing and search history, as well as app/site usage, all at 17%. The lowest ranked was user content such as emails, photos and voice recordings at 8%.

It is significant that despite a general sentiment toward privacy, consumers seem much more willing to share sensitive information than purchase and user history, which is much less intimate but often more useful to businesses. These numbers indicate a big opportunity for education on the importance of first-party data. Finding the perceived value exchange for information could take a variety of forms, and each brand will need to test what that threshold is for maximum effectiveness.

Businesses need to actively reassure consumers that they care about privacy and transparency, and they can do this with increased transparency on what’s collected, how it’s being kept secure, and highlighting the benefits of sharing information.  Encouraging users to create an account, rather than just supplying an email, may require enticing discounts, ongoing promotional codes or giving those users that comply first access to new products. Customer loyalty programs may also increase in popularity, which would give a store permission to track where, how, when and what a user purchases on- and offline to provide increased personalized customer service and discount opportunities.

As we enter a period of revitalization and economic rebuilding, this survey gives some sense of the opportunities and challenges that lie ahead for businesses. Undoubtedly more will change, but if there is one big takeaway, it is that future success for most businesses will rely on building strong and ethical digital relationships.

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