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COVID-19 Is Turning Privacy into a Corporate Reputation Issue

COVID-19 Is Turning Privacy into a Corporate Reputation Issue

The global businesses landscape is undergoing a massive tectonic shift in how the public views, and businesses address, data collection and privacy as a result of efforts to address COVID-19. Those who do not monitor and plan to get ahead of these shifts run the risk of a major reputational hit.

T

oday, some companies and public health experts are looking towards data as a silver bullet in the fight to stop the spread of the novel coronavirus. In doing so, much of the public is finding themselves at odds when it comes to the tradeoff between privacy and convenience. Consider the high-profile efforts from Apple and Google to track and trace potential exposure to the virus.

When the two companies announced the project at the beginning of April, it dominated headlines. The new system, which could alert users if they were in contact with someone who had tested positive for the disease, would rely heavily upon “geolocation data” enabled via smartphones, smartwatches and mobile apps. Even though the solution had the potential to become a powerful tool to address the pandemic, it still prompted debate. 

Geolocation remains a mystery to many consumers and reporters, despite it being a heavy hitter when it comes to commercial marketing assets. The global crash course on the presence and power of this data raised public concerns and media scrutiny. What’s more, it will have likely had an impact on regulatory and legislative action moving forward.

Indeed, all eyes are on today’s businesses and their data governance policies. According to Pew research, 81% of the U.S. population believe the potential risks they face because of data collection by companies outweigh the benefits. 

For businesses, looking towards data as a way to make headlines, take note: the public will continue to heavily scrutinize how their data is being collected and used, especially in the days that follow the pandemic. Fortunately, there are ways to forecast what the future might hold by looking at the evolution of data in our society.

Consumers & The 3 C’s of Data Privacy Evolution:

From a public standpoint, the rise of digital life over the past 20-25 years has steadily increased the relevance and prominence of data and its usage. What began as an acceptable trade-off between convenience and privacy was transformed, however, by the reaction to Cambridge Analytica as well as Russian disinformation campaigns. 

The attention brought to how data could be used for large-scale advertising targeting without the public’s knowledge helped spur increased privacy legislation.

FTI Consulting’s recent polling found that 55% of Americans agreed with the statement “We need more regulation placed on technology companies to ensure the public's data is protected,” compared to only 30% who agreed with the statement “We need less regulation on technology companies to ensure they can innovate and develop the latest technologies to adapt to the demands of the public.”

What comes next, though, will make geolocation a part of the cultural lexicon. Take the existing conversation about staying at home to save others and civil liberties. Geolocation could provide real public health benefits, but it will super-charge the civil liberties questions and become a very real topic of conversation, concern and investigation.

Current public opinion shows skepticism towards the technology, particularly if it is created or highly affiliated with a technology company. Specifically, in a Kaiser Family Foundation poll, 68% of Americans say they would be “willing” to share coronavirus test results anonymously through an app with “public health officials.”

That support, however, appears to drop significantly if the sharing is viewed as with “companies” versus public health officials.  Notably, The Washington Post/ University of Maryland poll finds that smart phone users are evenly split as to whether they would use such technology from “Apple or Google”; specifically, 50% say they “definitely” or “probably” will use it, and 50% say they “definitely” or probably will not use it.

What’s more, FTI Consulting’s own recent polling has found that when Americans are provided two sides of a contact tracing debate, by a 55%-45% margin, they respond that they are more “concerned” by the privacy implications than “encouraged” by the public health benefits.

This will no doubt move “privacy policies” from the bottom of a web page to the top of people’s minds. In its wake, data activism will rise as people organize to identify their rights and act on removal requests. Indeed, people will continue to push for more transparency and rights, while consumer groups rate companies on their use of data.

Businesses & The 3 R’s of Data Privacy Evolution:

From a business standpoint, businesses have been drowning in data for the last 20-25 years.  Entire ecosystems of service and software providers rose to help companies manage and glean insights from their data to improve marketing and customer offers.

However, with GDPR and CCPA, companies began to shift to view data like “rocket fuel” — very powerful but highly flammable if not stored, handled, and protected properly. This involved much more interaction and collaboration between marketing, IT and legal functions.

However, what comes next will require General Counsels to interact more with CEOs and Chief Communications Officers. Consider that, as of Q1 2019, there were over 1.8 million apps in the Apple app store.

Looking forward, major technology companies who use this data will be scrutinized and painted with a broad brush; Advertising agencies and major marketers will have to either make the cases as to why the benefits merit the use of this data or provide a data “ingredients” list of what goes into their marketing; Reporters will identify examples of marketing offerings that could have only been created through this data and imply the marketing efforts were “creepy” at best.

Even small businesses, 47% of whom have mobile apps and sites, will have to answer these questions.

In this world, pointing to a privacy policy will not be enough. Companies will have to articulate to all of their stakeholders how data and privacy inform what they are doing to market responsibly. If not, they risk more than just their reputation.

 

Published July 2020

© Copyright 2020. The views expressed herein are those of the author and do not necessarily represent the views of FTI Consulting, Inc. or its other professionals.

About The Author


Brent McGoldrick
brent.mcgoldrick@fticonsulting.com
Senior Managing Director
Strategic Communications
FTI Consulting

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