Privacy fears threaten to sunt e-commerce growth

The advent of secure electronic transactions and the growing Internet presence of high street banks are boosting con-sumer confidence in e-commerce.

There is a risk, however, that as one cause of concern subsides another one is about to emerge – privacy.

My fear is inexperience, and cavalier non-adherence to data protection practice from some new media developers, could create barriers to consumer adoption of e-commerce.

Research shows growing consumer support for some form of Internet privacy regulation. Why? Because consumers are increasingly distrustful of Net merchants that ask for personal data.

In the physical world, consumers may fill in a coupon, or give their name and address details over the phone, to provide a delivery point for the product they are requesting.

But in the electronic world, consumers question why such details are required, especially when they are merely browsing.

This situation is made even worse by the absence of opt-outs. Probably half the Websites I see do not have opt-outs for follow-up communication and, importantly, opt-outs from the data being passed onto third parties.

Is it any wonder consumers suspect that the submission of address data will lead to an onslaught of unsolicited direct mail?

Internet developers must be more scrupulous about abiding by Direct Marketing Association guidelines if consumers are not to be alienated – and advances in technology are making the problem more acute.

First generation Websites, through their technical limitations, allow-ed consumers to use the Web with relative anonymity.

But the new generation incorporate such features as cookies, payload URLs, session management and customer profile databases. These features are essential to the implementation of effective e-commerce sites.

This process often requires that the data be automatically logged on the user’s interaction with the Web application. But vendors must act responsibly, particularly with regard to the use of the data gathered. Users should be informed that their browsing habits are being recorded and may be used for marketing purposes.

Each site should carry a policy statement or privacy certification at the entry point, informing the browser whether data is being collected and, if so, whether it is to be passed to a third party.

The hard nut to crack for the industry will be unsolicited e-mail. Self-regulation, as proven in the direct marketing sector, only goes so far. It does not prevent renegade traders which operate outside of the law.

The solution will eventually come from technology and the self interest of organisations and telecoms operators taking concerted worldwide action.

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