Big data provides an enormous upside for businesses. By supplying granular insight into consumer behaviors and habits, it enables companies to better develop new products and services, improve existing offerings, reinforce relationships with consumers, and boost revenue.
And the data keeps coming. Traditional data sources—such as payment cards, loyalty programs, and Internet purchases—are now supplemented by data from social networks, mobile devices, and connected objects. Businesses with access to this data can predict, or even anticipate, purchasing decisions and consumer behavior.
But consumers can be cautious about sharing personal information and sensitive about how their data is used. As BCG research has shown, consumer trust is the key to unlocking big data’s full value potential; without such confidence, billions of euros in future economic and social value might be lost.
Earning Consumer Trust in Big Data: A European Perspective , a new report by The Boston Consulting Group and global law firm DLA Piper, addresses the competing interests of businesses, consumers, and governments. Specifically, the report examines the unique legal approach to data protection and privacy that the European Union (EU) is taking.
Under the 1995 Data Protection Directive, the EU imposed a standard set of principles on the processing of personal data across all 28 member states. Those principles are pivotal to understanding the legal risks of big-data processing in the EU. This report highlights key issues in the current EU Data Protection Directive, including liability of the data controller, legitimate uses of personal data, lawful data collection, informed consent, and other regulatory issues. It also provides an advance look at some of the changes that will be forthcoming in the new EU Data Protection Regulation, which will soon replace the Data Protection Directive.
It is critical for consumers to be guaranteed confidentiality, data security, transparency, and control over their own data as businesses increasingly mine big data to better understand their behavior. The winning strategy for businesses using big data will be to stay current on legal and cultural changes and to maintain customer trust.
