Fashion customers don’t trust retailers with personal data says report

Posted: 04/07/2019

Two thirds of customers do not trust retailers with their personal data according to a new report looking at the fashion customer’s journey commissioned by leading law firm Penningtons Manches Cooper and research consultancy Retail Economics.

Understanding and Influencing the Customer Journey for Fashion is a series of four reports commissioned to gain a better understanding of customer attitudes to issues including automated services, sharing personal data and the ongoing importance of good in-store experience. The first report focuses on awareness and research, when retailers and brands attempt to connect with customers across a multitude of platforms, both physical and digital.

While fashion brands are investing heavily in digital technology to move closer to the goal of achieving personalised experiences for every customer, the research indicated that customers – particularly older ones – have concerns over data security and privacy and are wary about the use of their personal data. Only four per cent of customers trust retailers the most when handling their personal data.

More than half of respondents said they would be more loyal to stores that offered a ‘meaningful in-store experience’. Friendly, knowledgeable staff were seen as a key part of this, with almost half saying they did not want to be helped by a robot or to use a touchscreen device for customer service issues. Only 13% were keen on the idea of virtual fitting rooms. Just over a third said they would not be put off shopping in a clothing store that displayed extended product ranges but only offered delivery of purchases.

While a range of technologies, including robotics and AI (artificial intelligence), are beginning to be used to create personalised recommendations, half of respondents said they would be unwilling to share personal data such as body shape, weight or height to enhance product recommendation accuracy. In fact there is evidence to suggest that some would be willing to pay more for goods and services to a retailer who didn’t use data to target promotions. Age was a factor in this, with nearly half of 18-24 year olds saying the discovery of new products was influenced by recommendations on their smartphone, while just 16% of the 65+ group said the same.

Penningtons Manches Cooper’s fashion and luxury brands team, which acts for a number of high profile brands including AllSaints and Hudson London, who contributed comments to the report, says the next decade is “seminal for the future health and shape of the fashion business”.

Matthew Martin, Penningtons Manches Cooper’s co-head of fashion and luxury brands and corporate partner comments: “Our fashion clients are increasingly seeking our guidance on how to adapt their business models to guard against uncertainties while ensuring they are in a strong position to quickly respond to new opportunities. These findings provide a useful perspective from which to consider how the law is adapting to the changes in commercial practices and vice-versa. The insights gained will help us better anticipate legal demands and give us a more rigorous understanding of sustainable business models that will attract future funding.”

Gavin Stenton, co-head of fashion and luxury brands and commercial, IP & IT partner says: “While a single, cross-platform customer experience that blurs the lines between in-store, online and on-the-go is the way forward, this report highlights the risks associated with the use of and security of customer data in achieving this. Balancing the optimal mix of value over perceived intrusion will therefore become a head-scratching equation to solve.”

Richard Lim, Retail Economics chief executive says: “The pace of technological disruption in retail is not set to slow down, with disruptive technologies forecast to be engrained in the sector over the next five years. The experience economy will continue to gain traction as well, as consumers become disenchanted with the abundance of goods they have access to.

“However, the future customer journey is underpinned by data. And if retailers and brands cannot build enough trust to capture sufficient shopper information to personalise, then the deeper engagements that will help retail experiences thrive over the next decade will be undermined.”

The report was written using data collected through a consumer survey contacted by Retail Economics of over 2,000 nationally representative individuals in Q1 of 2019.

FIND OUT MORE: To download the report, please click here.

Return to news headlines