Turning Customer Data Privacy Into a CX Differentiator

As trust becomes a deciding factor in customer loyalty, CX leaders can turn customer data privacy into a competitive advantage by designing transparent, brand-aligned privacy experiences across every touchpoint.

Customer experience leaders obsess over every word in their onboarding flow, A/B test button colours and optimise chat response times down to the second. Every touchpoint is carefully designed to feel seamless and on-brand, without adding friction to key customer journeys. 

But when a customer tries to download their data or adjust their privacy settings, that polished design and carefully crafted tone more often than not falls apart. 

What they usually encounter instead is awkward legalese that contradicts what your brand stands for – a disconnect that erodes the very trust your entire CX strategy depends on. 

When Privacy Becomes Part of the Brand Experience

I recently sat down with Sue Vinci, Verizon’s Chief Privacy Officer, who has spent more than two decades watching privacy evolve from a legal checkbox into a core business driver. She’s learned that the privacy experience you deliver to customers is just as important as every other touchpoint you measure – if not more. 

So why are CX teams ignoring the customer privacy experience entirely? 

“Customers want to do business with companies they can trust,” said Sue Vinci. “Privacy is a key component of trust, and we’re competing every day to gain and retain customers.” 

According to Deloitte, trusted companies see their customers spend 50% more on connected technology and services, yet less than half of consumers believe the benefits they get from online services (such as personalised recommendations, targeted discounts or faster checkout) outweigh their privacy concerns. That’s the lowest level the consulting firm has reported since 2019.

Privacy teams are designing customer experiences that CX leaders rarely review. 

They build data subject access request workflows, draft consent flows, and create cookie notices – all customer touchpoints – often without input from user experience professionals. Customer experience teams should be reviewing privacy flows and response templates for privacy inquiries. 

Vinci argues these experiences should feel elegant, not half-baked, and fully reflect your brand from end to end. “Privacy shouldn’t be viewed outside of the overall customer experience,” she says. “You want everything you do, everywhere you touch your customers, to reflect your brand.”

Personalisation Breaks Without Trust

As a CX leader, when was the last time you audited your company’s privacy notices? Or reviewed data deletion confirmation emails? Or checked what happens when a customer wants to adjust their communication preferences? 

For many CX teams, the answer to those questions is never. 

New research from McKinsey found that 71% of customers expect personalised experiences, while 76% felt frustrated when they didn’t receive them. More than likely, stats like this have made it into your quarterly planning decks, but knowledge of the need for personalisation doesn’t solve the core problem: customers won’t provide the data required for personalisation if they don’t trust how it will be used. 

Companies have to prove they deserve that trust with transparent data collection practices and by allowing customers to easily manage their data preferences. The trust equation gets even more complex for organisations using AI chatbots, recommendation engines or predictive analytics. 

Fewer than half of people around the world are willing to trust AI systems, and in the US, that number is even lower at 32%. Customers expect ethical and compliant AI systems, including transparency about when and how AI is being used, clear explanations of AI decision-making, and accessible methods for opting out or escalating to human support. 

Designing Privacy and AI Without Losing the Human Touch

Enterprises can adopt new technologies faster, future-proof against international regulations and convert trust into a competitive advantage when they build responsible AI governance into their systems. 

CX leaders can contribute to this goal by treating privacy as a critical component of the overall customer experience rather than just a legal function. 

When product teams discuss roadmaps, privacy professionals should be invited to the table as partners who understand customer expectations around data collection and use. 

Together, CX and privacy teams should map the customer journey for privacy interactions with the same rigour applied to any other flow, identify where customers encounter consent requests and how they exercise data rights, and evaluate whether the experience is consistent with the brand or reads like shoddy legal boilerplate. 

Privacy and CX teams should also collaborate with content teams to make sure privacy notices sound like customer-friendly communications rather than legal documents. Does your consent flow feel like an interruption, or an integrated part of the experience? 

Track how privacy touchpoints affect your customer sentiment, completion rates and long-term engagement, and you have another helpful metric to show the C-suite about how CX impacts retention, revenue and brand loyalty. 

CX leaders can make data privacy a reason customers choose their brand over competitors, using trust as a competitive advantage by building it into every interaction.

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