part 2: roi of truste privacy solutions – total economic impact (tei) report
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TRUSTe Webinar Series: Making the Most of your Data Privacy Management Investment
Part II - Total Economic Impact™ Report: The ROI of TRUSTe Privacy Solutions
Dave Deasy, VP of Marketing, TRUSTeNorman Forbush, Principal Consultant, Forrester
Dave DeasyVice President of Marketing, TRUSTe
Norman ForbushPrincipal Consultant, Forrester Research
Welcome and Introductions
2
•Webinar Series Overview
•Privacy investment / budget challenges
•Total Economic Impact (TEI) Study Overview
•TEI Study Details - benefits, costs, risks
•ROI Estimator Overview
•Open Q&A
Agenda
Part 1: The New Privacy– It’s All About Context – 5/14
Part 2: Total Economic ImpactTM Report: The ROI of TRUSTe’s Privacy Solutions – 6/12
Part 3: Privacy Investment Success Stories – 7/24
Webinar Series Overview
TRUSTe Overview
TRUSTe enables businesses to safely collect and use customer data to power all their online channels.
15+years ofglobal
privacy expertise
5,000+clients worldwide
acrossall industries
140+team focused on
data privacy management
#1 Privacy BrandTechnology & Services
Data Is Critical To Your Business Success
Data Powers All Your Customer Channels
Technology• Third-Party Trackers• Opt-out Management• Behavioral
Advertising• DAA / EDAA Icon
Serving• Geolocation Info• Device Recognition
Technology
Customer• Consumer Trust
Questions
• Acquisition / Retention
• RFP Requirements
• Competitive Alternatives
Regulatory• APEC• BCRs• COPPA• DAA / EDAA• EU Safe Harbor• EU Data Protection
Directive• FTC / ICO Mobile
Guidelines
Data Also Creates Significant Privacy Challenges
Data Privacy Management Strategy
Address Global / Enterprise / Cross-Channel Needs
Compliance Controls
Privacy Assessments
Ongoing Monitoring
Assess, Operationalize, and Manage Privacy Across the Enterprise
Platform Certifications
• Validate practices vs. TRUSTe Privacy Program Requirements
• Web, Mobile, Cloud, Data Collector• APEC, COPPA, Safe Harbor, EDAA• Privacy Seals & Certification Letters
• Data collection & usage audit• Web and app tracker analysis• Global compliance gap analysis• Privacy Findings Report• Privacy Analysts + Technology Tools
• DAA / EDAA icon serving• Preference & opt-out management
for OBA and Cookies• Ad Network integration• Compliance reporting
• Regular tracker scanning and analysis for websites, apps, and ads
• Privacy risk scores & benchmarking• Analysis, reports, and alerts• Dispute resolution service
• New privacy regulations driving complexity & resource requirements
• Website Privacy Statement not enough – Address all channels, geographies, new products / vendors, etc.
Why We Launched the Privacy ROI Project
• Privacy Assessment not enough – Operationalize and Manage privacy programs to ensure ongoing compliance
• Budgets requirements growing – 2013 IAPP study: 60% of companies non-personnel privacy budget > $75K+, 35% > $250K
• ROI popular topic of discussion at privacy conferences• ROI popular question from our clients• Build a framework for businesses to evaluate privacy ROI• Partnered with Forrester to build a model
• Leverage privacy practice expertise • TEI framework experience
The Total Economic Impact™ of TRUSTe Data Privacy PlatformForrester ConsultingNorman Forbush – Principal Consultant
June 2014
12© 2014 Forrester Research, Inc. Reproduction Prohibited
TEI Study Findings
TEI Framework and Components
13© 2014 Forrester Research, Inc. Reproduction Prohibited
Total Economic
ImpactRISK
Benefits(Impact on Business)
Costs(Impact on Budget)
Flexibility(Options)
Perform due diligence
Conduct customer interviews
Construct financial model
Develop case study / ROI Tool
Conduct webinar
The TEI framework centers on quantifying benefits, capturing costs, evaluating flexibility, and adjusting risk
TEI Approach and Methodology
Interview highlights
© 2014 Forrester Research, Inc. Reproduction Prohibited 14
Background• Four customer interviews
• Global technology company (Chief Privacy Officer and Assistant General Counsel)• Global telecommunications company (Director of Privacy and Compliance)• Global video game/app development company (Global Privacy Officer)• Global consumer packaged goods company (Associate Director of Global Digital Enablement)
• Fifteen customers surveyed• All customers have multiple years of experience using TRUSTe
Situation• Prior to using TRUSTe, these organizations relied on in-house lawyers and external law
firms for industry best practices, guidance, and legal advice• As these organizations expanded, they needed a more comprehensive data privacy
management program to manage:› Regulations across different geographies› Customer data across multiple channels› Compliance across marketing programs› Transparency and accountability around the collection and use of customers’ personal
information• It became too labor intensive and cost prohibitive to continue working with internal and
external parties to manage their data privacy challenges
The composite organization
15© 2014 Forrester Research, Inc. Reproduction Prohibited
Source: The Total Economic Impact of TRUSTe, a commissioned study conducted by Forrester Consulting on behalf of TRUSTe, June 2014
Based on 4 interviews and 15 in-depth survey responses, Forrester constructed an ROI analysis that illustrates the areas these organizations identified as having the greatest financial impact and consolidated them into a single composite organization model of costs and benefits.
The composite organization:• Is a public company with global operations• Develops and markets both B2B and B2C products and services• Has approximately 100 websites (including mobile & apps)• Has $5 billion in annual sales and 10,000 employees worldwide• Utilizes both internal and external legal services to assist in complying to global data
privacy laws
The composite organization implemented the entire suite of TRUSTe products, including privacy assessments and certifications, monitoring tools, and compliance controls.
TRUSTe reduces an organization’s brand and compliance risk and increases operational efficiencies
• Forrester was commissioned by TRUSTe to examine the financial benefit of the TRUSTe Data Privacy Management Platform
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Executive Summary
Three-Year Risk-Adjusted Financial Snapshot
© 2014 Forrester Research, Inc. Reproduction Prohibited
Source: The Total Economic Impact of TRUSTe, a commissioned study conducted by Forrester Consulting on behalf of TRUSTe, June 2014
• TRUSTe helps organizations build and implement a privacy program that enables their business to quickly and safely adhere to privacy laws and regulations while minimizing their legal and brand risk
• Based on our analysis of customer feedback, Forrester has determined that deploying the TRUSTe platform has a three-year risk-adjusted ROI of 151% and NPV of $375,000.
Customers chose TRUSTe because the platform addresses top concerns
17© 2014 Forrester Research, Inc. Reproduction Prohibited
Source: The Total Economic Impact of TRUSTe, a commissioned study conducted by Forrester Consulting on behalf of TRUSTe, June 2014
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Reduction of labor costs
Staying consistent with competition
Flexible service & support
Comprehensive privacy solution
Global presence
Brand protection
Privacy expertise
Building user trust
Trusted/strong brand in industry
Not at all important Somewhat important Neither important nor unimportantVery important Extremely important
Please rate how important each of the following was when deciding to use TRUSTe for your data privacy management solutions.
Costs include privacy assessment/certification, monitoring tools, and compliance controls
18
Privacy Assessment/Certification Services• Comprehensive audit of the organization’s data collection and usage practices• Review of privacy practices• Assessment of risk, a summary of findings, and required or recommended changes• The right to display the TRUSTe Certified Privacy Seal upon adherence to the
changes recommended by TRUSTe
Privacy Monitoring Tools• Analysis and ongoing insight into the use of first- and third-party web trackers• Assessment of associated privacy risk, performance impact, and data leakage risk• Third-party privacy dispute resolution management
Privacy Compliance Controls• Real-time user notification and preference management to ensure behavioral
advertising practices and cookie usage are in line with US and EU requirements
Total Annual Cost: $100,000*
© 2014 Forrester Research, Inc. Reproduction Prohibited
Source: The Total Economic Impact of TRUSTe, a commissioned study conducted by Forrester Consulting on behalf of TRUSTe, June 2014
*Actual costs dependent on client implementation - number of sites / apps, geographies, etc - contact TRUSTe for details
The three-year risk-adjusted cash flow for the TRUSTe platform shows a ROI of 151%, a NPV of over $375,000
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Three-Year Risk-Adjusted Cash FlowInitial Year 1 Year 2 Year 3 Total PV
Costs ($0) ($100,000) ($100,000) ($100,000) ($300,000) ($248,685)
Benefits $0 $251,149 $251,149 $251,149 $753,447 $624,571
Net Benefits ($0) $151,149 $151,149 $151,149 $453,447 $375,886
ROI 151%
© 2014 Forrester Research, Inc. Reproduction Prohibited
Source: The Total Economic Impact of TRUSTe, a commissioned study conducted by Forrester Consulting on behalf of TRUSTe, June 2014
Results- I. Productivity & Output
Incremental productivity & output Increased by 1,500 working hrs/year
© 2014 Forrester Research, Inc. Reproduction Prohibited20
Source: The Total Economic Impact of TRUSTe, a commissioned study conducted by Forrester Consulting on behalf of TRUSTe, June 2014
TRUSTe
Data Privacy Management Platform gives the ability to crawl websites and report to companies their compliance
status
Without TRUSTe
Internal employees would have to manually go through each of the company’s websites & ads
to ensure compliance
Results- II. Legal Costs
Legal costs were reduced by 300 hrs/yr
© 2014 Forrester Research, Inc. Reproduction Prohibited21
Source: The Total Economic Impact of TRUSTe, a commissioned study conducted by Forrester Consulting on behalf of TRUSTe, June 2014
TRUSTe
Provides insights on industry trends, privacy updates,
guidelines and advice on global privacy policies & regulations
Without TRUSTe
A company would have to hire additional legal resources to
monitor and provide updates on privacy policies
Results- III. Data Privacy Costs
The cost of data privacy breach was reduced by 25%
© 2014 Forrester Research, Inc. Reproduction Prohibited22
Source: The Total Economic Impact of TRUSTe, a commissioned study conducted by Forrester Consulting on behalf of TRUSTe, June 2014
TRUSTe
Provides added assurance in compliance of privacy policy, protects company’s brand &
reputation
Without TRUSTe
Company’s are more exposed to data breaches
TRUSTe impact: Chances of having privacy
breach reduced by 25%
TRUSTe impact: Increased productivity in
privacy dept. by ensuring all sites compliantAverage time savings of 5
hours per site per year
TRUSTe platform benefits
23© 2014 Forrester Research, Inc. Reproduction Prohibited
Source: The Total Economic Impact of TRUSTe, a commissioned study conducted by Forrester Consulting on behalf of TRUSTe, June 2014
Increase in output per worker
Three-year benefits:Annual: $150,000 Total (PV): $335,725
Avoidance of legal costs
TRUSTe impact: Average time savings of
300 hours of external and internal legal time per year
Three-year benefits:Annual: $60,000Total (PV): $141,751
Reduction in brand/compliance risk
Three-year benefits: Annual: $65,721Total (PV): $147,095
There is definitely less manual work related to managing compliance across multiple websites by using TRUSTe’s monitoring tools. – Chief privacy officer
TRUSTe gives added assurance to our customers that the privacy of their personal information has been independently verified... In addition, our company’s brand reputation is protected against mishandling our customers’ personal data. – Associate director of global digital enablement, consumer products company
TRUSTe saves us a lot of time because of their guidance and the processes they bring. Otherwise we would have to rely more heavily on our internal legal department. – Director of privacy and compliance, telecommunications provider
Disclosures
The audience should be aware of the following:• This document is an abridged webinar version of a full case study (Forrester Total Economic Impact of TRUSTe, June 2014).
• The study is commissioned by TRUSTe and delivered by the Forrester Consulting group.
• Forrester makes no assumptions as to the potential return on investment that other organizations will receive. Forrester strongly advises that readers should use their own estimates within the framework provided in the report to determine the appropriateness of an investment in TRUSTe.
• TRUSTe reviewed and provided feedback to Forrester, but Forrester maintains editorial control over the study and its findings and does not accept changes to the study that contradict Forrester’s findings or obscure the meaning of the study.
• The customer names for the interviews were provided by TRUSTe.
• Forrester does not endorse TRUSTe.
© 2014 Forrester Research, Inc. Reproduction Prohibited24
Source: The Total Economic Impact of TRUSTe, a commissioned study conducted by Forrester Consulting on behalf of TRUSTe, June 2014
25© 2014 Forrester Research, Inc. Reproduction Prohibited
TRUSTe ROI Estimator
TRUSTe ROI Estimator: Overview
© 2014 Forrester Research, Inc. Reproduction Prohibited 26Source: TRUSTe ROI Estimator, a commissioned tool conducted by Forrester Consulting on behalf of TRUSTe
TRUSTe ROI Estimator: Inputs
© 2014 Forrester Research, Inc. Reproduction Prohibited27
Source: TRUSTe ROI Estimator, a commissioned tool conducted by Forrester Consulting on behalf of TRUSTe
TRUSTe ROI Estimator: Benefit and cost details
© 2014 Forrester Research, Inc. Reproduction Prohibited28
Source: TRUSTe ROI Estimator, a commissioned tool conducted by Forrester Consulting on behalf of TRUSTe
TRUSTe ROI Estimator: Summary results
© 2014 Forrester Research, Inc. Reproduction Prohibited29
Source: TRUSTe ROI Estimator, a commissioned tool conducted by Forrester Consulting on behalf of TRUSTe
Quantifying TEI for the TRUSTe platform
Key takeaways:
• All companies should assess their own risk profile
• TRUSTe customers are tracking metrics and seeing positive impact
• Contact TRUSTe Rep to estimate the financial implications of your current privacy investment:
– Determine a high-level estimate of the economic impact based on your specific business environment
– Begin value-based internal discussions on what have often been cost-focused budget decisions
– Create financial model to begin Privacy discussion with internal stakeholders
© 2014 Forrester Research, Inc. Reproduction Prohibited
Summary
Privacy Landscape More Data…
More Complexity…
More Resources…
More Tools…
? More Budget
Forrester TEI Study Framework to Estimate
ROI for Privacy• Lower brand /
compliance risk• Lower legal team costs• Higher team productivity
Customize to your situation
Powering Trust For Over 5,000 companies
Thank You
Questions??
Resources Download TEI report at www.truste.com Contact TRUSTe to discuss the return on your
Privacy Investment 888-878-7830 or dave@truste.com
Mark you calendar for the 3rd and final webinar of the series Topic: Privacy Investment Success Stories Date: July 24th at 10am PDT Speakers: Chris Babel, CEO @TRUSTe &
Fatemeh Khatibloo, Analyst @Forrester
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