Data Privacy

Part
01
of four
Part
01

Data Privacy: Consumer Demographics

The US citizen most likely to be concerned about data privacy is a college educated Baby Boomer making more than $100,000 per year living in the suburbs.

Age

  • Baby Boomers, or those aged 55+, are more concerned about their data privacy than other generations.

Education

  • People with college or advanced degrees are more concerned with data privacy, although it is also a concern for those without a college education.

Income Level

  • Those making more than $100,000 per year are slightly more concerned with their data being utilized by social media and tech companies, although over 70% of people in all incomes levels were concerned.

Ethnicity

  • Consumers of all ethnicities are likely to be concerned about data privacy, but Blacks and Hispanics are more concerned than Whites about their data being given to law-enforcement officials or utilized for identify fraud.

Gender

  • Men and women are equally concerned about data privacy, however, women are more protective of their photos/videos than men.

Location

  • People living in the suburbs are the most concerned with data privacy, however, people in rural areas and living in cities were also very concerned (over 70% of people in all categories saying they were concerned).

Research Strategy

In order to complete this demographic profile, the research team utilized different studies on data privacy with US citizens to individually address all areas of interest, as a complete pre-compiled demographic profile was not available. Additionally, results from survey questions relating to concerns over data privacy, but not blatantly about the "concern" over data privacy, were utilized. For example, for education level, the specific survey question was whether people feel their data is "less secure" than it was previously, for which more educated people answered that they felt their data was less secure. We made the logical assumption that these people, since they feel their data is less secure, are more concerned about data privacy.
Part
02
of four
Part
02

Data Privacy: Consumer Motivations

Consumers are motivated to keep online data private by fear of their information being stolen and abused. Many consumers are taking precautions and incorporating actions such as using password management apps, enabling two-factor authorization, and updating their privacy settings to keep their online data private. Below are the explicit findings on the request.

Consumer Motivations to Seek Online Data Privacy

Consumer Habits for Seeking Online Data Privacy

Part
03
of four
Part
03

Data Privacy: Not Using Private Search Engines

Some potential negative outcomes of not using a private search engine or other privacy products include interruptions while browsing due to pop advertisements, lack of privacy because most of the non-private search engines do not have a tracker blocker, among others. Below are explicit findings on the request.

Statistics on Online Privacy

  • Ninety-one percent of Americans believe that they have lost control over their data.
  • Sixty-one percent of Americans want to improve their privacy when they are online.
  • Thirty-six percent of Americans think they have no control over what apps do with their data.
  • Fifth-four percent of Americans worry about how secure their data is and their privacy online.

Insights

Data Collection

  • The common collected information includes the user's location, the type of device he/she is currently using, and the type of advertisements he/she views.
  • Additionally, cookies data show who the user is, who are his/her friends, what she/he is interested in, and the locations he/she has visited.
  • However, all this can be avoided if the user makes his/her searches private by using private browsers.

Ad Blockers and Tracking Blockers

  • Private browsers come with Ads and tracking blockers that provide the user with uninterrupted browsing experience free from interruptions of advertisements. The tracking blocker hides the user's location, hence, private browsing.
  • They also allow the user to view pages that are not specifically targeted for him/her. Non-private browsers or search engines like Amazon provide pages that specifically target a certain user based on the information collected by them on the user's search history or interests.
  • Private browsers give the user the freedom to search for new things and not just recommendations based on his/her previous searches provided by search engines like Google.

Discriminatory Pricing

  • Online retailers are known to vary prices depending on the location of the users and their browsing patterns. T
  • The travel industry can use this information to spike airfare to entice users to book immediately and avoid a further increase in prices.
  • Location data can be used to set a high price for people browsing from high-income areas compared to those from low-income areas.
  • Private browsers hide the user's location and help him/her avoid unnecessary costs due to data manipulation.

Usage Limits

How Attackers Used the Consumer Data

Tom was Hacked
Gamers
  • Cybercriminals usually target gamers because they know they are not willing to lose all the time and money spent on developing their characters or profiles.
  • For example, the creator of the "World of Warcraft" account was hacked twice, and his progress deleted.

Example of how the Government can use the Consumer Data


Part
04
of four
Part
04

Consumer Tracking: Risks

When advertisers track consumers, they run the risks of consumer backlash, litigation, reduced ad effectiveness, and intrusion. To minimize these risks, advertisers need to strike a balance between personalization and privacy, and they need to understand the types of personalization that consumers find delightful or intrusive.

Risk of Consumer Backlash

  • While increased access to consumer data and ad targeting have been shown to improve ad performance, there is evidence that tracking consumers to sell products or services may result in consumer backlash.
  • This risk is more pronounced now that data breaches, fake news, and creepy ads have increased consumers' awareness of web cookies tracking their every move online.
  • A case in point is Target whose targeted coupons for pregnancy-related products drew ire from consumers. For one of its promotions, Target sent these coupons to women it believed to be pregnant. The targeting became controversial because a father inadvertently learned through this coupon that his teenage daughter was expecting.
  • Consumers who learn they have been targeted by a brand in unacceptable ways are less likely to trust that brand or engage with that brand.

Risk of Litigation

  • Advertisers that track consumers run the risk of litigation as well. Advertisers can land in court and lose money in the process if they are not careful about handling consumer data.
  • Toysmart.com, an online toy retailer that is now bankrupt, was sued by the Federal Trade Commission when it planned to sell off consumer data to the top bidder.
  • Advertising network DoubleClick, which monitors Internet users anonymously, was sued as well for planning to match its real-world mailing list with its database of anonymous Internet users.
  • Online drugstore More.com was sued by an attorney general for sharing confidential consumer data with third parties even when its privacy policy dictated that it could not do such a thing. One of the attorney general's staff members, after signing up on More.com, was solicited by a contact lens seller (a third party).

Risk of Reduced Ad Effectiveness

  • Consumers' heightened awareness of tracking by advertisers could lead to reduced ad performance if it brings about privacy concerns.
  • Three researchers from Harvard Business School recently discovered that when consumers learn companies are making inferences about them based on their activity on third-party websites, they feel "intruded upon." Ad effectiveness, in turn, declines.
  • According to these researchers, these findings mirror social truths. For consumers, tracking them across websites and making inferences based on this collected data is akin to talking behind their back. If talking behind people's backs is socially unacceptable, then making inferences about people based on their activity on third-party websites is unacceptable as well.
  • Ads that disclose to consumers that they have been targeted because of their activity on third-party websites were found to be 24% less effective than ads that disclose to consumers that they have been targeted because of the products they have selected in the past.
  • Ads that disclose to consumers that they have been targeted because of inferences were found to be 17% less effective than ads that disclose to consumers that they have been targeted because of information they willingly provided.

Risk of Intrusion

  • Advertisers need to strike the right balance between privacy and personalization if they do not want to run the risk of intrusion. As far as ad personalization is concerned, there is a thin line between delightful and creepy.
  • More than 60% of consumers find the following advertising actions acceptable: product recommendations that were based on their purchase history, birthday emails, and reminders about items left in their online shopping cart.
  • In contrast, less than 50% of consumers find the following instances acceptable: receiving an email with a coupon while browsing at a store, and receiving an ad for a recently discussed product.
  • Consumers who feel intruded upon can turn off personalized ads or use ad blockers. According to a survey, 34.1% of millennials, 29.2% of Gen Xers, and 22.3% of Boomers have successfully switched off personalized ads. Also, this survey indicates that 64.4% of male consumers and 52.6% use ad blockers.
  • It appears that the things that distinguish delightful personalization from creepy personalization are as follows: (a) whether information was obtained within or outside the website where the ad appears, and (b) whether information was willingly provided by the consumer or inferred by the advertiser.

Research Strategy

Though we could not locate any source that readily lists the risks that advertisers face when tracking consumers, we were able to identify the aforementioned risks by reading through sources that cover the risks, dangers, implications, or disadvantages of ad targeting or personalization. We know that advertisers track consumers mainly to improve ad targeting or personalization, so we looked for sources discussing this topic, and noted insights that touch on consumer tracking and privacy concerns. While we were able to list four risks above, these four risks all boil down to the risk of turning off consumers or infringing on the rights of consumers.
Sources
Sources

From Part 02
Quotes
  • " In contrast, households named credit card or bank fraud, data collection by online services, loss of control over personal information, and other concerns at nearly the same rates in 2017 as 2015"
  • " Fifty-seven percent of online households cited identify theft as a major privacy or security concern in 2017, compared with 63 percent in 2015"
  • "Similarly, the proportion of online households that said privacy concerns stopped them from doing certain online activities dropped from 45 percent to 33 percent."
Quotes
  • "Equifax, one of the three largest consumer credit reporting agencies in the United States, announced in September 2017 that its systems had been breached and the sensitive personal data of 148 million Americans had been compromised. "
  • "The data breached included names, home addresses, phone numbers, dates of birth, social security numbers, and driver’s license numbers. The credit card numbers of approximately 209,000 consumers were also breached."
  • "The Equifax breach is unprecedented in scope and severity. There have been larger security breaches by other companies in the past, but the sensitivity of the personal information held by Equifax and the scale of the problem makes this breach unprecedented. "
Quotes
  • "Alongside London-based elections consultancy Cambridge Analytica, the social media giant is at the center of an ongoing dispute over the alleged harvesting and use of personal data. The allegations have heightened concerns over whether such data was then used to try and influence the outcome of the 2016 U.S. presidential election and the Brexit vote."
Quotes
  • "The hotel chain asked guests checking in for a treasure trove of personal information: credit cards, addresses and sometimes passport numbers. On Friday, consumers learned the risk. Marriott International revealed that hackers had breached its Starwood reservation system and had stolen the personal data of up to 500 million guests."
Quotes
  • "Almost half of consumers (46 percent) have done nothing to adjust their privacy settings on social media, and less than half (45 percent) have checked to see if their data has been compromised over the past 12 months according to a new report."
  • "Password habits are putting users at risk of a data leak. Over half of Americans (53 percent) commit their passwords to memory, and one in three (36 percent) write their credentials down. "
  • "Over two in five Americans (41 percent) have not enabled two-factor authentication for any of their accounts. Few have password management apps."
Quotes
  • "Akamai is a global technology/digital company started over 20 years ago at MIT. They do research and provide solutions to various issues on internet. They've worked with ESPN, Yahoo!, and Entertainment Tonight."
Quotes
  • "59 percent of consumers wait at least a month before sharing any personal data with brands"
From Part 03
Quotes
  • "When browsing the internet, you leave behind digital traces that websites can legally use to keep track of your activities and identify you. The data collected can include; your location, what device you’re using, which advertisements you’ve clicked on, and more."
Quotes
  • "It comes with an integrated ad blocker, very handy for undistracted browsing."
Quotes
  • "Your browsing history is so long and detailed that much of what you see online is targeted specifically for you. Amazon shows you products you may want to buy based on past purchases, and Google thinks it knows what you want to search for based on what you’ve looked for previously. If you’d like to “start fresh,” private browsing can let you do that."
Quotes
  • "Whether you are constantly posting on social media, occasionally shop online, or simply use the Internet to surf the web, you are being watched, even when you’re in the so-called “privacy” of your own home."
Quotes
  • "After the Ashley Madison hack, cyber criminals contacted him and demanded 500$ to remove his name from a publicly searchable registry. If not, they would also send an email to his family, informing them of Tom’s affair."
Quotes
  • "LeBlanc said, that's another place government officials could theoretically go to find information about people of interest."