Privacy Issues Dividing Internet Consumers

Many Internet users don’t mind companies collecting data about them, but they seem confused when it comes to the ideas of cookies and privacy on the Web, according to research by Cyber Dialogue.

The Cyber Dialogue report, based on in-depth interviews with more than 1,500 Internet users, suggests that online consumers are not averse to revealing personal information, rather they are primarily concerned with how companies use the information collected.

Among the study’s key findings is that 69 percent of Internet users have unknowingly signed up for email distribution lists and more than 40 percent of users don’t know or understand what cookies are or how they work. Yet Cyber Dialogue also found that more than 80 percent of users are willing to provide personal information, including name, education level, age, and hobbies, in exchange for customized content.

“In this consumer-controlled medium, protecting the privacy of customers is the only long-term option,” said Kevin Mabley, Cyber Dialogue’s vice president of strategic and analytical services. “Selling customer data may be a viable business model, but the real value the Internet offers to businesses is the ability to build sustainable relationships through a truly two-way dialogue with its most valuable customers.”

While nearly 30 percent of online users feel that a site that shares their information with other sites is trying to better interact with them, companies should not assume this translates into the freedom to run unlimited, untargeted marketing campaigns. In fact, trust is a powerful force behind customer loyalty and breaching it can quickly result in a substantial loss of revenue.

“There are many important and legitimate uses for personalization tools such as cookies, including security, personalization, marketing, and customer service,” Mabley said. “However, as the amount of personal data collected in consumer marketing databases grows exponentially, the potential for abuse skyrockets. Successful businesses must realize that they can only collect only information that is absolutely necessary to provide value for customers — and guard that information at any cost.”

In 1999, 46 percent of online users reported that they accept all cookies within their browser, a significant rise from only 19 percent in 1997. In addition, Cyber Dialogue found that 50 percent or more of online users believe it is “OK” for Web sites to share information, such as promotions responded to and ads clicked on, as long as this data enables customized content. However, 49 percent of Internet users feel a site that shares this information with other sites directly invades their privacy.

Other Cyber Dialogue findings include:

  • More than 95 percent of Internet users have received unsolicited email
  • 21 percent of Internet users are not sure what their browsers are set to when it comes to cookies, down from 50 percent in 1997
  • 74 percent of online users who received unsolicited email took action to be removed from the offending senders’ email list
  • 71 percent of Internet users personalize a Web site to receive more relevant content, especially local info such as weather, movie listings and community calendars

These findings are from Cyber Dialogue’s American Internet User Survey, which consists of in-depth interviews with 1,000 Internet users and 1,000 nonusers. The survey is part of Cyber Dialogue’s Cybercitizen Continuous Advisory Service. Additional findings are based on the Cyber Dialogue Online Privacy Survey, a national sample of 500 online US adults drawn from the Cyber Dialogue database of online consumers. Data is weighted by online usage and demographics to reflect the general online US population.

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