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The impact of data breaches on brand trust

Brands failing to keep their customer data secure is a key reason why consumers are losing trust in certain retailers. Now three-quarters (74%) of shoppers are actively changing their shopping habits to avoid tracking from retail brands according to the latest Ethical Commerce Alliance (ECA)’s Retail Trust Index (RTI) which examines the UK’s leading retail brands’ data practices and the impact this has on consumer trust.

Retailers hit by data breaches such as WHSmith, The Works and PC World rank lowest in this year’s Retail Trust Index.

The 5 highest ranked retailers in the UK based on RTI trust scores:

  1. B&M Stores - 84.76
  2. Lidl - 83.58
  3. Boots - 83.42
  4. Smyths Toys Superstores - 81.81
  5. Waterstones - 81.54

The 5 lowest ranked retailers in the UK based on RTI trust scores:

  1. Card Factory - 30.42
  2. WH Smith - 31.44
  3. The Works - 34.05
  4. PC World - 36.02
  5. Iceland - 39.07

Privacy issues

Use of cookies and trackers by retail brands is heightening privacy concerns as 80% of consumers are aware that online retailers track and use their online browsing history.

Key findings

Reaffirming concerns, 38% of consumers stated that retail brands aren’t doing enough to protect their online data and privacy. In addition, 61% of consumers state online retail brands don’t effectively communicate their tracking practices and use of cookies - an industry-wide misstep when clear data privacy policies are the most important factor in building online trust for almost half of consumers (48%).

Nina Müller, director of the Ethical Commerce Alliance concludes: “Retailers can no longer ignore the importance of privacy in their digital operations. With regulatory bodies like the ICO and the European Court of Justice looking to uphold the ethical standards laid out by GDPR as they’ve done with big tech, retailers have to put customers first. They need to earn their trust, ensuring that ownership, respect and transparency are at the heart of their operations.”

Methodology

Over 2,000 online shoppers in the UK were surveyed to gauge consumer sentiment and the impact of intrusive data practices on consumer trust. For the full ranking of the UK’s leading retail brands and further insights visit the Retail Trust Index page here.

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