Book review: how to build customer trust while protecting privacy.

• Author: Taylor, Sheila
• Position: The Privacy Payoff: How Successful Businesses Build Customer Trust - Book Review

TITLE: The Privacy Payoff: How Successful Businesses Build Customer Trust

AUTHORS: Ann Cavoukian, Tyler J. Hamilton, and Don Tapscott

ISBN: 0-070905-60-6

PUBLISHER: McGraw-Hill

PUBLICATION DATE: 2002

LENGTH: 288 Pages

PRICE: $24.95

SOURCE: Amazon.com (www.amazon.com)

Studies have shown that many consumers are concerned about how their personal information will be used, stored, and protected by companies and other commercial organizations. Consumers also are concerned about the conditions under which their personal information will be sold or shared with other parties. Such concerns are not misplaced in a world where identity theft is increasing and Web site cookies, data mining, and other technologies facilitate the tracking of an individual's activities.

To combat those concerns, many jurisdictions, such as Canada, the European Union, and the United States have enacted private-sector privacy legislation. Although the authors acknowledge that commercial organizations must comply with such legislation to avoid fines and other penalties for non-compliance, they successfully argue that privacy protection is "both good business and good for business" and that the companies who implement privacy-sensitive practices will reap the benefits of increased customer trust and loyalty.

The Privacy Payoff: How Successful Businesses Build Customer Trust is a primer for small and large companies seeking to introduce privacy protection in their business strategies and daily operations. The book focuses on private-sector "information privacy," which the authors define as an "individual's ability to control the use and disclosure of information about him- or herself, and to determine who is permitted access to this information and who is not."

Chapter 1 introduces the underlying premise of the book: Companies can win and retain customers by safeguarding their privacy. Chapter 2 explores the economic importance of privacy protection by illustrating how privacy concerns (and fears) resulted in a loss of consumer confidence that contributed by tens of billions of dollars to the slow growth of e-commerce. This chapter further builds on the competitive advantage of trust in the marketplace by illustrating that information privacy is just as important in business-to-business (B2B) transactions.

Recognizing that many businesses are concerned that the cost of privacy compliance will be prohibitively expensive, the authors address the cost-benefit of implementing...