Gone are the days when investing in data privacy and security were viewed strictly as the cost of reducing data breaches and privacy threats; many CISOs now see it through the lens of innovation and opportunity.
A survey by FTI Consulting shows that 75% of organizations have made significant changes to their data privacy programs. This is a number that’s expected to surge in 2022 and beyond.
Moreover, global spending on information security and risk management services is forecasted to grow at 12.4% to reach $150.4 billion in 2021. It is primarily because organizations today are more open to investing heavily in reinventing their cybersecurity infrastructure.
However, the accelerated pace of rethinking cybersecurity infrastructure doesn’t necessarily indicate a desire to improve threat prevention alone; it also demonstrates that businesses are concerned about delivering value to their customers by building trust.
Yes, our modern ROI-focused world demands a more sophisticated and mature view of digital privacy to accelerate the growth of a digital business. And this can be achieved by leveraging crucial untouched data to deliver seamless user experiences.
Whether we talk about mitigating losses from data thefts, achieving operational efficiency, or increasing customer loyalty, investing in digital privacy has offered new business growth opportunities in the past couple of years.
As such, it’s vital to understand how businesses can invoke the true potential of digital privacy and the metrics to measure the ROI through digital privacy.
Let’s hash it out.
Digital privacy is often defined as the level of privacy an individual has regarding their personal information online and in the digital world. When talking about digital privacy in the context of an organization’s cyber security, it’s all about what organizations must do to protect users’ personal and sensitive data in all virtual contexts and situations.
The concept of digital privacy centers on the fact that professional or personal affairs of collecting information may leave digital footprints. For instance, many users don’t realize that data relating to their identities and internet habits are consistently being monitored, stored, and managed.
To avoid the misuse of users' personal information and ensure maximum security, certain global data regulation compliances for digital privacy must be met by organizations collecting, storing, processing, and managing users' details online.
For instance, data protection and privacy regulations, including the European Union’s (EU’s) General Data Protection Regulation (GDPR) and California Consumer Privacy Act (CCPA), are already becoming more stringent. They demand businesses operating in their region comply with their respective data privacy policies. Failing to abide by these regulations may lead to hefty fines, and customers may also lose trust in the brand.
Digital privacy protects all the information that exists in digital form and is created or shared while using the internet through any device, including mobile phones and PCs. These types of data include:
- contact information
- bank details
- digital photographs
It’s crucial for businesses that collect user information to secure their customers’ personal information. This can be done, for example, by incorporating robust and compliant security mechanisms, including multi-factor authentication and encryption, both of which add layers to the security of data.
Multi-factor authentication (MFA) ensures user/customer information isn’t accessed by unauthorized individuals, even if one line of defense (passwords) is compromised. With MFA, users receive a one-time password, typically via email/ SMS text message or push notifications, that they need to enter to authenticate.
There’s also the angle of using passwordless authentication, which helps mitigate the risks associated with password breaches and account takeovers resulting from phishing scams and other credential-based attacks.
Businesses operating in different parts of the world couldn’t deny that meeting all the data privacy and security compliances is the toughest nut to crack. And things become quite challenging in an era when data localization is swiftly becoming the first condition to operate in a country, state, or region.
However, digital privacy has more to offer besides the security and privacy advantages; it navigates overall business success.
According to a consumer data protection and privacy survey conducted by McKinsey, half of the respondents agreed that they are most likely to trust a business/organization that asks for only information relevant to its products/services.
Also, the brands that requested a limited amount of personal information were considered more reliable. These specific markers signal to consumers that an organization is concerned about the privacy of its customers and taking a thoughtful data management approach.
And the same survey also revealed that half of the consumer respondents trust companies that quickly respond to breaches and hacks or disclose such incidents to the public.
These practices are crucial for companies since the impact of data/privacy breaches may hamper overall business performance. In a nutshell, leading brands are now learning that data privacy and protection can create business advantages.
So far, we’ve learned that businesses that don’t prioritize privacy investments lag behind their competitors and are likely to miss opportunities of building customer loyalty and trust.
In conclusion, we’ve found that building a foundation of strong digital privacy within your organization:
- Encourages exponential business growth over time
- Ensures your business remains compliant with data privacy and security regulations
- Mitigates the chances of reputational damages (and can increase customer trust)
- Improves lead generation and conversions and ensures returning customers
- Reduces operational costs and improves efficiency
Brands can’t afford to lose a single customer because of non-compliance issues. Hence, it won’t be a good decision for businesses to miss out on the chance to stay ahead of the competition.