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Brands Gamble with Reputation and Trust by Failing to Adopt Stronger Methods to Protect Online Identities

Internet crime and electronic banking securityPrivacy has been a major issue for consumers ever since e-commerce emerged—but companies have had plenty of time to get their security in order, and shoppers are getting tired of waiting. In fact, new research reveals that brands risk consumer trust and their own reputations by delaying adoption of stronger methods to protect online consumer identities. The 2017 State of Consumer Privacy and Trust survey from customer identity management firm Gigya shows that two thirds (68 percent) of consumers are concerned about how brands use their personal data, while a similar number (69 percent) worries about security and privacy risks inherent in the increasing adoption of Internet of Things (IoT) devices, such as fitness trackers, smart watches and connected cars.

For brands, the findings highlight an impending crisis as they balance customer expectations and new privacy requirements with their need for customer data to deliver a more personalized online experience. This dilemma will come to a head when the General Data Protection Regulation becomes reality in May 2018, as brands will then face new hurdles in presenting and protecting their European consumers’ data.

The new survey, which polled more than 4,000 U.S. and U.K. adults, brings to light widespread concern about brands’ approach to data privacy. This worry increases across generations, with 60 percent of 18- to 24-year-olds registering concern, versus 73 percent of those aged 65 and older. The pattern was similar when participants were asked their opinion about data security on IoT devices: 62 percent of 18- to 24-year-olds registered concern, and 72 percent of the 65-and-older group.

The good news for brands is that consumers are ready and willing to take responsibility for their personal data—if given the chance to do so. Some 63 percent of consumers feel personally accountable for protecting their data vs. relying on brands or governments. Yet consumers don’t believe brands are paying attention, with 31 percent of respondents saying brand privacy policies are weaker now than they were 12 months ago. Despite this sentiment, we still see poor password habits, with 42 percent of consumers using four or fewer passwords across online accounts. This underscores the need for brands to find new ways to protect their customers from their own poor habits.

When brands do adopt best practices, consumers take notice, as shown by Facebook. Since implementing a transparent approach to privacy about two years ago, Facebook has added 467 million new users, for a total of 1.86 billion users at the end of 2016. Gigya’s survey results show that of total respondents with Facebook accounts, 61 percent have taken control of their privacy settings on Facebook. Some 40 percent have changed their settings within the past year, 21 percent have changed them at some point more than 12 months ago, and an additional 23 percent are aware they can make changes to their privacy settings while relying on Facebook’s default settings, confirming that control over privacy is important to consumers.

“There is looming disconnect for brands if they don’t respond more aggressively to consumer demand for privacy and protection of their data,” said Jason Rose, senior vice president of marketing at Gigya, in a news release. “Brands that put consumers in control of their privacy and deploy platforms that strengthen consumer data security will ultimately gain consumer trust. These brands will overcome the personalization-privacy disconnect and deliver on the full promise of their online strategies.”

Download the full report here.

Source: Marketwired; edited by Richard Carufel

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