Vague online privacy policies are harming e-commerce, new survey reports

Online retailers who think that consumers don’t read privacy policies or that their own privacy policies are clear, better take a second look at the market. A new survey shows that 67% of Internet users have decided not to register at a web site or shop online because they found the privacy policy too complicated or unclear.

In addition, 64% of consumers have decided not to purchase something from a company because they weren’t sure how their personal information would be used.

Those are some of the results of a poll conducted by Harris Interactive for Privacy & American Business and Deloitte & Touche LLP. Privacy & American Business is a unit of the Center for Social & Legal Research, a non-profit, non-partisan public policy think tank that deals with issues of consumer and employee privacy and data protection.

"There is a significant portion of the population that is becoming increasingly concerned about identity theft, and it is influencing their purchasing decisions" said Rena Mears, partner and leader of the privacy services group of Deloitte & Touche. "Companies need to understand this and leverage the internal control improvements they have made as a result of Sarbanes-Oxley to increase the integrity and security around the personal information they hold for their customers."

Other survey findings included:
• 20% of respondents report that they have personally been a victim of identity fraud or theft. The results would suggest that 44 million American adults have ever been a victim of identity fraud or theft, an increase of 9 million since 2003, the survey reports.
• 78% of respondents agree that consumers have lost all control over how personal information is collected and used by companies
• Half believe that businesses are not handling their personal information in a proper and confidential way.
• 59% do not agree that existing laws and organizational practices provide a reasonable level of protection for consumer privacy today.
• 87% of respondents have read or heard about personal consumer data being stolen or disclosed in error by a company, university or government agency. The survey characterizes that figure as “remarkably high awareness across all demographic categories.”