How to Collect Customer Information Without Putting Their Privacy at Risk

Consumers of all generations are growing increasingly concerned about data privacy. They worry about companies collecting their information without being entirely transparent and about the possibility of a data breach that could leak their details. Over the last several years, many major companies have had massive breaches, exposing millions of consumers’ data. For example, in July 2024, a breach at AT&T leaked information about many of its customers’ calls.

However, these same consumers also want companies to deliver deeply personalized experiences. They want companies to know their names, clothing sizes, favorite colors, purchase histories, contact preferences, and more. To market effectively to them, you need more data points. Here’s how to strike a balance, learning what you can, while making customers feel safe.

1. Anonymize Their Data

Some traditional methods of data collection, like third party cookies, track individual users across the web as they browse and click. This is especially risky, since leaked information can reveal so much about a single user’s behavior and browsing habits. Still, many companies have relied on cookies because they make it so easy to deliver a targeted experience to each user. Now, many are at a loss for what to do as laws and tech behemoths hint at the idea of phasing cookies out.

Other methods of data collection, however, may pose less of a risk of exposing each individual user’s information. For example, predictive audiences anonymize, aggregate, and analyze large sets of data to make probabilistic predictions about behavior. In simple terms, this means they make guesses about big groups, instead of looking at each person under a microscope. This reduces the risk that any one user’s private data will be linked to their actions.

2. Let Them Choose What to Share

Many companies are also turning to first-party data collection methods, like offering surveys, quizzes, feedback forms, and more. With these methods, customers get to choose what to share, meaning they feel more in control of their private data. At the same time, they may be more open and specific about their preferences or what they want from companies. It’s a win-win: companies get better information, while customers get to feel more secure.

To make first-party data work, however, companies need to be extremely transparent about what they’re collecting and how it will be used. Surveys and quizzes need to be attached to clear informed consent language, and customers must agree to participate. Unfortunately, some companies may collect or use first-party data in ways consumers aren’t expecting. This increases the risk of unwanted information-sharing and can hurt both user trust and company reputation.

3. Use Effective Security Tools

When collecting data, companies should work with IT professionals to make sure they’re using appropriate security tools and protocols. For example, for first-party data collection, this means using only trusted, secure forms designed to keep data private. When users must log in on an app or website, companies should, when possible, use multi-factor authentication. Any information collected about customers should be stored only in secure, encrypted databases.

Security goes double when it comes to employees, to avoid the risk of a major breach. For example, employees should access user data only on encrypted company devices. Emails and other messages regarding user data should also be encrypted, and physical documents and offices should be secured. Employees should be trained on how to keep data safe, and every company should have an incident response plan to manage a breach if one occurs.

4. Take Advantage of New Tech

Companies can use artificial intelligence and other new technologies to keep users’ information safe in a number of ways. For example, they can use AI-powered systems to monitor for anomalies or unusual activities that could mean a potential data breach. AI can also test whether information is being handled or stored safely and alert companies to potential vulnerabilities. Finally, it can scan large data sets and look for dated personal information that should be deleted.

Beyond AI, some companies are using other technologies, like blockchain and edge computing to (arguably) keep data safer. For example, with blockchain, user information is tied to a unique user key, instead of to their personal information. Meanwhile, edge computing stores information at distinct server locations geographically closer to users. However, these and other technologies still have unique vulnerabilities — no method is completely secure against a breech or leak.

5. Collect What You Need; Delete What You Don’t

One of the best ways to keep user data safe is to limit how much of it you collect and store. Only collect the bare minimum information you need for a specific function, and anonymize whenever possible. Don’t ask for unnecessary information — for example, don’t collect customers’ home addresses if you don’t plan to mail anything. Regularly audit your databases, messages, and other storage systems, to remove old or unused data or move it to a secure, offline storage system.

Ex-employees and third-party contractors can be a major risk for a potential breach. For example, former employees may keep company equipment, like laptops, containing user data. Make sure to have employees return old equipment or remotely wipe it when they leave, using secure deletion methods. Work with third parties to make sure they also delete records, and have clear policies in place to keep them compliant.

Putting Safety First

Tools like predictive audiences and artificial intelligence will continue to evolve and offer deeper levels of personalization and behavior prediction. That’s why, when it comes to data collection, your principles matter more than your method of implementation. The tools of the trade may change, but as long as you keep consumer privacy top of mind, you’ll remain a secure and trusted partner.