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Introduction
Thank
you, Chairman Stearns and members of the Subcommittee, for the opportunity to
testify on this important issue. My name is Zeke Swift and I am Director, Global Privacy for
The Procter & Gamble Company.
As
background, Procter & Gamble markets 300 brands of consumer products to
nearly five billion consumers in over 140 countries.
These brands include Tide, Swiffer, Crest, Pantene Pro-V, Pringles,
Pampers, Olay, Iams and Vicks. We
are based in Cincinnati, Ohio and have on-the-ground operations in over 70
countries.
Key
messages
Privacy
is a public policy issue long associated with the high tech and direct marketing
industries. So why does P&G, a
consumer products manufacturer, care about the privacy issue?
Let me summarize our interest in three key points.
1.
First, information about consumers is central to our business.
We rely on information to better understand consumer needs, and produce
superior products, information and services to meet them.
As a result, we have an enormous stake in fostering an environment of
trust in which consumers confidently share their information with us.
Creating this climate includes making sure that our practices meet or
exceed consumer expectations, and contributing to industry and policy
initiatives that enable other companies to do the same.
2.
Second, new technologies are enabling us to deliver a level of benefit
on the basis of personal information that was previously impossible.
When consumers share information with us, we now can deliver tailored
offers such as samples or coupons, opportunities to test new products, or
customized products and information. We
want to preserve the ability to take full advantage of current and emerging
technology to meet consumer needs.
3.
Third, privacy -- or more broadly the way we handle personal data --
is a complex issue for a company the size of P&G.
We receive consumer data from many sources including offline promotions,
online websites, Consumer Relations contacts, market research and clinical
studies. As mentioned, we operate
in over 70 countries. We have about
200 corporate entities and relationships with hundreds of vendors and
contractors. Administrative
processes, such as those imposed by recent European legislation, impose
unimaginable burdens for companies like ours with little or no substantive
benefit to consumers. We hope that
any steps taken in the United States would reflect this learning.
P&G privacy practices
Now,
let me share a couple of points about our overall approach to privacy.
First,
we’re guided by two fundamental principles:
(a)
We strive to treat information provided by individuals as their own,
which has been entrusted to us; and
(b)
We strive for transparency with consumers about how their information is
used. We inform people about how we
handle information they provide us. We
give them choices about further communication with P&G or further uses of
their data. We offer them
reasonable access to data they’ve provided to review it, correct it or ask us
not to use it.
Second,
we have a long history of responsible treatment of personal information.
Our employee privacy policy, for example, dates back more than 20 years.
And, we posted our first on-line privacy statement in 1997.
Third,
for consistency’s sake we’ve chosen to take a global approach to privacy. We
have a single global privacy policy. We
have a global structure for developing and implementing our information
practices worldwide. We are
building a global IT system to implement and monitor our policy globally.
Consumer benefits
Now
let me provide some examples of the way we’re using consumer information
today. At the most elemental level,
when consumers share their information with us, we can give them information,
services and products tailored to their needs or interests.
These may include new product announcements, free sample offers,
participation in contests and sweepstakes, and opportunities to test new
products not yet available in stores.
But
at a more sophisticated level we use interactions with consumers over the
Internet to deliver personalized or customized products and services.
For example:
1.
With Reflect.com, a woman provides information about her
individual attributes and lifestyle and creates personalized skin care, hair
care, fragrances and cosmetics. The
items are delivered to her door in a personalized package within 3 to 7 business
days. The beauty products are produced from some 50,000 possible
product combinations based on P&G formulas.
2.
Our Pampers.com website strives to be the best resource on the web
for parents and parents-to-be. It
offers parents an opportunity to sign up for a free monthly newsletter from the
Pampers Parenting Institute, tailored to the age of their baby and delivered to
their e-mail inbox. The newsletter
is full of information about child rearing written by experts, offers tips from
bathing to discipline, coupons, and opportunities to sample new products like
our disposable Bibster baby bibs.
How we collect and use personal information
In
order to deliver offers such as these, we collect data such as a person’s
name, address, email address or phone number so that we may contact them or send
them items they have requested. To
increase the likelihood that our offers will be of interest, we collect
demographic information such as age or gender, lifestyle information such as
household status or personal interests, and other relevant information such as
product usage and preferences.
Consumers
volunteer most of the information we store in our databases.
In some situations we use additional demographic information purchased
from data aggregators such as Acxiom, Equifax or Experian.
The data provided by aggregators is from publicly available sources such
as telephone directories and public records, or from information reported by
consumers themselves through vehicles such as warranty cards.
We
seek to build our relationships with consumers on the basis of transparency and
trust. We offer individuals who
have provided us with information choices about further communications.
We ask whether or not a consumer would like to be contacted about
additional offers or services. We seek wherever we can to provide consumers with a
convenient means to tell us, yes or no, whether we may use the information they
provided to re-contact them.
We
do not sell personal information. We
obviously do share data with vendors acting on our behalf to fulfill a
promotion. We do not share
data with companies beyond our vendors without the individual’s consent.
We
are committed to keeping data secure and take precautions against loss, misuse
or alteration. These measures include physical security, controlled access to
data and encryption for data transmission.
We require vendors, partners and contractors to provide equivalent
privacy measures and forbid them to use data for any additional purpose.
Summary
In
conclusion, we believe that understanding consumer needs, delivering consumer
benefits and generating consumer trust are the issues at the heart of any policy
discussion on privacy. If I may
paraphrase Representative DeGette from an earlier subcommittee hearing, “There
are two secrets about privacy: privacy
-- the stewardship of personal information -- is good for business, and
information sharing is good for consumers.”
Thank
you.
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