privacy & security: the new drivers of brand, reputation and action

Privacy & Security: The New Drivers of

Brand, Reputation and Action

Global Insights 2012

Data breaches, security incidents and

privacy missteps are making headlines

worldwide and have become a focal

point for social media discussions and

legislation.

Managing data security and privacy

effectively is essential to businesses

today. The growing volume and

sensitivity of information being shared,

stored and used is driving demand for

greater transparency about how it is

being managed and protected.

Data security and privacy have moved from

the backroom to the boardroom.

Edelman’s industry study shows, for the first time, why managing data security and privacy impact business success. Our survey reveals:

The gap between consumer expectations and what businesses are actually delivering.

A relationship between effective data protection and business success.

That data security and privacy considerations do impact purchasing decisions.

People care about the security of their

personal information more than ever before. A majority of consumers are more concerned about data security and

privacy than they were five years ago and sense they are powerless to

exert control, leaving companies with the responsibility for protecting it.

Q12. Compared to five years ago, how has your level of concern regarding online data security and privacy changed?

Q15. Using a scale of 1 to 5, where 1 means “strongly disagree” and 5 means “strongly agree,” please indicate your level of agreement with the following

statements. (Summary of top 2 box scores shown)

of global consumers are

MORE CONCERNED than they were 5 years ago

over how their personal information is shared and used by companies

of global consumers feel they have

LOST CONTROL 68%

70%

Base: All respondents (Global n=4,050)

These concerns present both a challenge and

an opportunity for businesses.

Q15. Using a scale of 1 to 5, where 1 means “strongly disagree” and 5 means “strongly agree,” please indicate your level of agreement with the following

statements. (Summary of top 2 box scores shown)

Q14. Compared to five years ago, how would you describe the security of your personal information online?


Consumers are fed up with the status quo and want companies to act,

having seen either no change or a decline in the security of their data

over the last five years.

of global consumers feel companies

MORE SERIOUSLY need to take security & privacy 85%

of global consumers feel their

PROTECTED online privacy is adequately by business practices

32%

9%

25%

23%

36%

7% Much more secure

Somewhat more secure

No Change

Somewhat less secure

Much less secure

Security of Personal Information Online Compared to Five Years Ago (Global)

57% of consumers report no

change or a decline in the

security of their personal

information online

80%

Adults are most concerned about information

held by businesses they use most frequently. Online shopping and banking, which require the sharing of financial

information, are the most common online activities. Understandably,

consumers are most concerned about the security of their financial

information.

Most Common Online Activities (Global)

82% Online Shopping

Online Banking

Q1. Which of the following actions have you taken in the past three months?

Q3. What types of online personal information are you most concerned about? Please order the following types of information from least to most important.


12%

13%

17%

26%

28%

36%

78%

90%

Browsing activity

Content posted by others to social networks

Content posted by you to social networks

Frequent purchase / shopping data

Health information

Emails

Personal information

Financial information

Information of Greatest Concern Online (Global)

A notable gap exists between the number of people who consider data

security important in the finance and online retail industries and the

number who actually trust them to protect personal information.

23-point gap in expectations

92% 84%

78% 77% 69%

63%

50% 50% 43%

37%

69%

33%

51% 48%

12%

27%

12% 9% 11% 6%

23%

Finance OnlineShopping &

Retail

Medical &Healthcare

Government SocialNetworking

Technology News &Media

Automotive Food &Grocery

Gaming Utilities*

Importance of privacy and security in each industry (global)

Trust in each industry to protect personal information (global)

Financial institutions and online retailers are

not meeting the needs of their customers.

Q7. How important is your privacy and security when doing business with the following industries? *NOTE: Utilities not included as a response code

Q8. Which industry do you trust most to adequately protect your personal information? Please select the top three industries.


51-point gap in expectations

NOTE: Q7: summary of top 2 box scores shown; Q8: top three industries selected

Concern over businesses’ ability to protect

information impacts engagement in activities

important to online retailers and banks. Consumers report abstaining from frequent shopping or loyalty card

programs and online banking to protect their personal information.

Q4. Which of the following actions have you taken to protect your online information?


do not join a frequent shopping

card or loyalty card program

ONE in FIVE adults

do not bank online ONE in TEN adults

Consumers Taking Action to Protect their Online Information

Nearly half of consumers reported that data security is among the top

three factors they consider when purchasing a smartphone.

Consumers consider data security and privacy

features when purchasing tech products.

Top Three Most Important Factors Considered

When Purchasing Smartphones (Global) 69%

61%

48% 47%

40% 35%

Price Ease of Use Data Security & Privacy Style & Design Product Warranty Physical Dimensions(size, weight)

Q5. In your opinion, when making a decision to purchase the types of products below, what factors are most important? Select up to three choices.


34%

54%

34%

51%

53%

75%

43%

45%

42%

42%

59%

71%

Physical Dimensions (size, weight)

Product Warranty

Style & Design

Data Security & Privacy

Ease of Use

Price

Tablets Personal Computers

For personal computers and tablets, security considerations are on par with

style, design and physical dimensions of the product.

Security considerations also impact other

purchasing decisions.

Top Three Most Important Factors Considered

When Purchasing Tablets and Personal Computers (Global)



Security considerations also impact other

purchasing decisions. Even shoppers of traditional mobile phones and videogame consoles feel

security is a key concern.



of global consumers consider

DATA SECURITY AND PRIVACY among the top 3 most important factors when purchasing standard mobile phones

22%

29%

of global consumers consider

DATA SECURITY AND PRIVACY among the top 3 most important factors when purchasing videogame consoles

51%

42%

48%

29%

22%

17%

58%

37% 34%

44%

37%

Personal Computers Tablets Smartphones Standard MobilePhones

Videogame Console Digital Music Player*

Consumers selecting Data Security & Privacy among Top Three Important Factors Trust in Security of Device

Smartphones are suffering from a trust gap. More customers take security into account when purchasing a smartphone

than say they trust the security of the devices. Comparatively, smartphones

are considered the least secure devices.

Consumers selecting Data Security and Privacy among Top Three Most Important Factors vs. Trust in Security of Devices (Global)


Q6.Please indicate your level of trust in the security of the following types of products. *NOTE: Digital music player not included as a response code


14-point difference in consumers considering security

important and those that trust security for smartphones

Consumers indicate willingness to leave online services if personal

information was accessed without permission and are most concerned

about services that involve financial information.

The premium on security translates to adoption

and retention of consumers.

Consumers Likely to Switch Providers or Stop Using Services Entirely if Personal Information was Accessed Without Permission (Global)

80% 79% 77% 75% 75% 67% 67% 65% 63% 59% 55% 55% 54% 50%

Q9. For the following types of companies, if your personal information was accessed without your permission, how likely would you be to switch to a different provider or

stop using these services entirely, if they did have personal information on you? Please use a scale of 1-5, where 1 is “not at all likely” and 5 is “very likely.”


Data shows that inaction on issues of data security and privacy will put

businesses are risk of losing their customer base.

Businesses must manage security and

privacy like a line of business and will lose

customers if they do not.

Q16. Have you ever left or avoided companies because they have had security issues in the past?


Consumers that have Left or Avoided Companies because of

Security Issues they have had in the Past

46% 41%

55% 58%

36%

53% 52%

31%

Global US Brazil China Germany India Korea UK

Americans proved most loyal to the companies they do business with, yet

ONE in TWO say they are likely to change brands after a data breach

Actions Taken following Data Breach Events

of global consumers would

after a company they rarely used suffered a data breach

SWITCH PROVIDERS

In the wake of a data breach, individuals are even willing to abandon the

companies they trust most. Data breaches may also impact reputation

due to the strong tendency of victims to share their experiences.

Consumers indicate they will act to protect their

privacy if businesses don’t.

71%

of global consumers

TOLD A FRIEND about their experience

39%

of global consumers

POSTED ONLINE about their experience

29%

Q10. If the brand you trust most and use most loyally suffered a data breach, how likely would you be to switch brands?

Q11. If a brand you rarely use (but still has your personal data) suffered a data breach, how likely would you be to switch brands?

Q21. Did you take any action following these events?
