Chairman Tauzin

Prepared Witness Testimony

The House Committee on Energy and Commerce

W.J. "Billy" Tauzin, Chairman

Link to Committee Tip Line:  Fight Waste, Fraud and Abuse
   

 

 

Opinion Surveys: What Consumers Have To Say About Information Privacy

Subcommittee on Commerce, Trade, and Consumer Protection
May 8, 2001
3:00 PM
2123 Rayburn House Office Building 

 

 
 

Dr. Sandra Bauman
Vice President, Marketing and Business Development
Wirthlin Worldwide
708 Third Avenue, Suite 1000
New York, New York, 10017

Americans are generally concerned about how companies who collect personal information use the information. What they fear most is that somehow this personal information they share gets into the wrong hands and some harm comes to them, such as having their identity is stolen. At the same time, consumers understand that in order to get information, they need to give information. That said, in order to conduct a transaction, whether it be online or distance shopping, they are more willing to give certain personal information that is deemed necessary for that transaction, rather than some possibly sensitive unnecessary personal information that doesn’t seem necessary.

This is intuitive, of course. The challenge is to understand what types of information are more sensitive and what types of information customers deem necessary to a transaction. If we were to generically ask in a poll: "Are you concerned about your privacy?," of course a large percentage would say yes because it is taken out of context in terms of why the information was necessary to share in the first place. Different situations may require different types of disclosure of personal information.

Wirthlin Worldwide has conducted a great deal of opinion research in the past three years on the subject of privacy (most of which is proprietary to a number of different clients), but in the aggregate as we drill down into what the consumer receives in return—both from the internet and direct shopping—for the sharing of personal information —both from the internet transactions and direct shopping—the picture is painted differently than what some would have you think.

In March 2000, we conducted a multi-phase qualitative study on privacy. Our approach began with four group discussions in Philadelphia, PA and Grand Rapids, MI, which were designed to uncover initial impressions of the public’s attitudes toward privacy issues. Following these group discussions, we conducted a total of 85 in-depth one-on-one values-based laddering interviews. These interviews were designed to provide a thorough, in-depth understanding of the general public’s attitudes about privacy issues by uncovering respondent’s perceptions of the direct marketing industry at both the rational and emotional level. These interviews lasted approximately 2 hours and were conducted in New York, NY, Chicago, IL, Los Angeles, CA and Washington, DC.

Most recently, we conducted a nationwide telephone study to obtain an up-to-date picture of how the public views privacy issues. Our survey was conducted late last week, on May 2-3, 2001. We contacted 617 respondents to participate in the 13-minute survey, the results of which we have prepared for you. The margin of error for a study of this size is + 3.9 percentage points.

Findings from the two qualitative studies indicate that Ppeople make choices and form opinions based on personally held values. The rational elements of the decision-making process are important in supporting the emotional components they tap into. As long as individuals feel protected and that they have control, the When people get physical benefits from sharing information—as long as they feel protected—these benefits satisfy emotional needs. In fact, we summarize the way people think about the need to provide personal information in this way: I want to give what I want when I want, and I want to get what I want when I want . In other words, consumers are willing to part with information they perceive as necessary to commence or complete a transaction of their choice.

.I want to give what I want to give and I want to get what I want to get, when I want it.

There are categories of information consumers are willing to share in order to conduct a transaction and other personal information they believe should never be shared. In our most recent research, for example, the majority of people say they are "never comfortable" sharing their social security number, financial information, medical information or information about their children. These types of information are deemed sensitive and therefore individuals information they are less likely to share such as medical information and financial information and information about their children fallsinformation which falls into the category of "not necessary" or "none of your business." Conversely, people are usually comfortable revealing their gender, age, education, occupation, hobbies and interests, and how they heard about the site, [REFER TO CHART 1]

There are actions businesses can take to make the information that is shared more secure, which would result in raising consumers’ confidence to give personal information in the first place. For example, actions that make consumers more comfortable include: using industry services to opt-out of direct marketing and telemarketing lists, using technology to prevent identity theft, restricting access to medical and financial data for marketing purposes and communications campaigns about highlighting consumer rights and privacy protections. [REFER TO CHART 2]These are policies such as restricting access to medical and financial data for marketing purposes and using industry services to remove your name from mailing telemarketing and e-mail marketing lists. If businesses were to champion a series of safety and security measures, consumers would have a better sense of control and feel that by providing personal information they have made a smart choice, saving time and money .

The Internet, which is still a relatively new medium, is not completely understood by the public, even by many users. Most do not know how it operates. They know the Internet is a communication tool for providing and receiving and providing information. However, they do not know how information travels over the Internet and who is at the other end of the monitor. It is a fear of the unknown that raises the level of skepticism for many consumers and reduces their feelings of control.

For example, most people will provide their credit card to a stranger to process a transaction at a traditional business or restaurant without concern for their personal credit data. These practices have a tradition of being secure and are therefore widely accepted. With a new medium such as the Internet, consumers’ level of comfort is tied to their experience. Those who participate in Internet commerce tend to feel more knowledgeable about the Internet and more comfortable with providing personal information. Our research shows that as people have positive experiences with Internet commerce, For those with experience, their level of skepticism is diminished allowing them to enjoy the medium. Over time, as more and more people experience Internet commerce, the unknown nature of the medium will fade as it become more a part of our daily lives.

In summary, companies that voluntarily enact good privacy policies -- ones that are easily understood by everyday consumers -- can help comfort consumers that their information will not be abused. break down the perception that business can’t police itself. In other words, industry can achieve this effectively through can adopt self-regulating policies concerning the collection, use, storage and exchange of personal information.

Thank you.


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