Monetising customer data without their knowledge must stop
With data privacy high on the corporate agenda, tech industry expert Sridhar Iyengar warns against companies cashing in on customer data and explains Zoho's commitment to keeping confidential information secure
On Data Privacy Day this year, we made a call to the industry to completely reconfigure business models to ensure customers and their data are protected and are kept truly private. B2C practices surrounding customer data are leaking into the B2B world at an alarming rate. What started off as user tracking to serve ads, has now become what we term 'adjunct surveillance'.
Companies such as social networks and search engines are being used by many businesses, without thought around what the true pay-off is. For example, if using a third party to measure web analytics, companies can expose their customer data through trackers to that third party, who uses it for commercial gain. Customers are not made aware of this. We see this as unscrupulous behaviour.
How far will boundaries continue to be pushed in concealing this from customers? We urge SaaS companies to not just focus on their own policy and practices, but ensure they can keep their customer data privacy promises through taking note of the practices of any third party applications used on their web properties and ensuring compliance with their policy.
Moreover, as per data privacy laws all customer information exposed to any third party has to be done only with the consent of the customer.
Online advertising and privacy simply do not mix. Some businesses may not truly understand the implications of using third party applications with trackers on their own properties, but ignorance can no longer be an excuse. We are dismayed and discouraged about how pervasive these practices are becoming. Data privacy was built into our DNA from day one of operating.
When we created Zoho we truly wanted to deliver what was best for our customers, not just in terms of functionality but also keeping their privacy safe and secure. In 2019 we removed all tracking software from third-parties on our websites and applications.
We closed loopholes to achieve enhanced privacy for our customers. Other businesses are still exploiting these to generate revenue from third-party ad trackers. We urge every business to audit their models carefully and ask the following questions:
1. How much customer data do you need in order to serve your customers better without compromising their privacy?
2. How much customer data is exposed to other third parties through your business operations, and is any potential financial gain worth risking the compromise of customer privacy? How transparent are you to your customers on this - has the data been collected with customer consent?
3. What is morally correct in your treatment of customer data, rather than what provides the most immediate commercial gain?
4. What new steps can you take to ensure customer data privacy?
Sridhar Iyengar is Managing Director of Zoho Europe
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