Shoppers don’t trust retailers with their data, survey finds

Nearly half of Aussies say they don’t trust retailers to handle their personal data, with more than half unwilling to share their personal information.

A survey of more than 2800 shoppers covering 44 retailer loyalty programs shows that Aussie shoppers have very little faith in their favourite stores to keep their personal data secure, and are even willing to forgo rewards to avoid handing it over.

The Loyalty Insights Report, compiled by e-commerce news outlet Power Retail, in conjunction with consumer advocates the Australian Loyalty Association (ALA), looked at what customers want from retailer loyalty programs, including the types of information they would or wouldn’t be willing to give up.

The report highlights the challenges facing businesses, mainly that even with incentives, a majority of shoppers are uncomfortable sharing their data with retailers. The report demonstrates that retailers need to rebuild consumer trust in handling personal data safely, following multiple recent high-profile data breaches.

The survey shows 43 per cent of people are unwilling to give up any more personal information than necessary to retailers or brands even in exchange for rewards or special offers.

The research also found that if people have to receive communications from a retailer, they overwhelmingly prefer it to be via email (81 per cent) over any other method, particularly SMS messages.

Loyalty programs customers trust the most include Woolworths Everyday Rewards, Coles Flybuys, MYER One, Amazon Prime, Priceline Sister Club, MECCA Beauty Loop, and Sephora Beauty Pass among others.

Power Retail editor Rosalea Catterson says the results point to a general distrust in the abilities of business to safeguard people’s information, particularly in light of the many recent high-profile data breaches.

But she also says a retailer highlighting their data security bona fides can be an opportunity to win new customers over.

“Whilst data security is a major concern for consumers, it offers a key opportunity for retailers to adapt and rebuild trust with their customers,” she says.

“An up-front approach that communicates clearly with consumers about where and how they use their data and the measures they take to protect customer data, can go a long way to building consumer trust.”

Older Aussies wary of joining loyalty programs

Breaking down the survey responses by age showed that baby boomers (defined here as those born before 1964) were the second-least likely age group to sign up to a loyalty program for fear of giving up personal data.

At the other end, it was the youngsters of gen Z who were most likely to embrace loyalty programs, perhaps reflecting their relative ease with giving up data, at least compared to their elders.

Gen Z also had the highest level of engagement with – meaning they are most likely to make use of – loyalty programs.

“These types of programs give great value for money, both in discounts, points earned, and special offers and have unique offers that reward you for consistent purchases,” Ms Catterson says.

Which loyalty programs are you signed up for? Do you worry about how much data you’ve given them? Let us know in the comments section below.

Also read: Are reward schemes and loyalty programs worth it?

Brad Lockyer
Brad Lockyer
Brad has deep knowledge of retirement income, including Age Pension and other government entitlements, as well as health, money and lifestyle issues facing older Australians. Keen interests in current affairs, politics, sport and entertainment. Digital media professional with more than 10 years experience in the industry.
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