As quarantine orders end and businesses begin to reopen, governments around the world are rolling out new coronavirus contact-tracing smartphone apps to track personal location data and provide notice when users encounter someone known to be infected with COVID-19. The goal is to reduce the number of new infections from each sick person, and to prevent exponential growth of cases. These mostly voluntary efforts require widespread adoption to be effective, but new research from New York-based Luxury Institute indicates an overall reluctance to share the data right before the pandemic, for data needed for contact-tracing apps to operate, especially in North America, Australia and Germany, with greater acceptance in Asia.
Surveys of high-income consumers from nine different countries for the Luxury Institute’s State of the Luxury Industry 2020 report provides fresh insights into propensities of affluent consumers to permit sharing of various types of personal information. Only small minorities of respondents in total worldwide are willing to share location tracking (15 percent) or medical/health (14 percent) information with companies and brands that they trust. Current acceptance levels of tracking apps appear to confirm that similar levels of trust prevail with government agencies.
Countries where affluent consumers are least inclined to share medical and health information are Canada (6 percent), the U.S. (8 percent), and Germany (8 percent), while medical data sharing acceptance runs more at higher rates in China (27 percent) and South Korea (24 percent). In similar fashion, affluent consumers from Germany (9 percent) and the U.S. (11 percent) are least likely to share location data, while China’s (21 percent) acceptance rate for personal tracking is second only to that of France (23 percent), a country that has endured major terrorist attacks in the past decade and places a premium on security. Gender is not a major factor influencing the inclination to share these types of data, but age weighs heavily, with millennials under 40 years of age are more inclined than Baby Boomers to share personal data.
However, higher income appears to be a positive factor in whether consumers share data, very importantly, as long as they trust the brand. Worldwide, consumers with higher incomes are more likely than those with lower incomes to share location data (18 percent vs. 13 percent) and medical information (16 percent vs. 13 percent) with brands they trust. In addition, higher-income consumers are also relatively more inclined to share information about their fitness and wellness, business travel and location, and browsing and search history with trusted brands.
Higher wealth also plays a role in data sharing decisions, with 18 percent of those in the upper half of the net worth spectrum willing to share location data, compared to 13 percent of those in the lower echelons of wealth. The inclination of wealthier individuals to share location data is most pronounced in France (25 percent), China (24 percent), and Canada (21 percent), home to a large community of wealthy exiles from China. Wealthier individuals are also more likely to share information about current products owned with trusted brands. Wealthier consumers understand the major value creating opportunities, as well as the risks of empowering data, better than mainstream consumers.
U.S. and China Often at Extremes of Sharing Spectrum
One prominent theme to emerge from the research is a fundamentally relatively more permissive attitude toward sharing personal data in China than in the United States. In addition to location data and medical information, affluent Chinese consumers have a greater propensity than Americans to share data across all eight categories of personal data under consideration: lifestyle/interests (60 percent vs. 38 percent); products owned (50 percent vs. 38 percent); spending (38 percent vs. 23 percent); fitness and wellness (50 percent vs. 15 percent); business travel (37 percent vs. 14 percent); browsing history (40 percent vs. 14 percent).
On the basic question of what they would do if they could control access to their personal data, U.S. consumers are four times more likely (44 percent) than those in China (11 percent) to say that they would not allow brands to access any of their data; 85 percent of Chinese consumers say that they would provide data to brands in exchange for more personalized service, but only 42 percent of U.S. consumers say the same.
This disparity in attitudes may stem from Chinese citizens being younger and having grown accustomed to surveillance and censorship by Beijing through digital platforms and direct means from the start of their digital lives, in contrast to traditionally prevalent suspicion of big government in the U.S.
“Trends among the affluent with respect to providing personal data access to trusted brands are emerging rapidly. The Luxury Institute continues to measure these trends because they are the most critical factors in unleashing the value of advanced personalization,” said Luxury Institute CEO Milton Pedraza.
“There are some clear trends. Chinese consumers, who are younger, are willing to share data for personalization, while western affluent consumers are far less trusting. However, wealthier individuals everywhere are more willing to share personal data when they are reassured that it is in the hands of ethical, trustworthy brands that will deliver high value. That is a huge opportunity for ethical luxury goods and services providers. Trust is the currency of the digital economy that drives the most critical resource, personal data. In order to accelerate data sharing that will unleash massive economic value, brands must earn the trust of their customers now.”