Two-thirds of fashion customers don’t trust retailers with personal data

A new report has revealed that 67% of shoppers do not trust fashion retailers with their personal data.

The report, "Understanding and Influencing the Customer Journey for Fashion", was commissioned by leading law firm Penningtons Manches Cooper and research consultancy Retail Economics. The data was collected through a consumer survey - contacted by Retail Economics - of over 2,000 nationally representative individuals in Q1 of 2019.

More than half (55%) of respondents indicated that, as online product recommendations are typically inappropriate, they do not see the benefits of providing more personal data.

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 4% 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 of those surveyed 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 to them.

Age was also a key factor in responses, with nearly half (49%) 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. Overall, just over 1/3 of survey respondents said they are made aware of new clothing products and ranges through social media and exposure to online influencers.

Penningtons Manches Cooper’s fashion and luxury brands team, which acts for a number of high profile brands including AllSaints and Hudson London, 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.”

The report says that "a rapidly evolving digital landscape of new technologies is influencing the way we research, buy and consume fashion. Brands now routinely communicate directly with customers via social media and rely on sophisticated data analytics to create personalised product services and recommendations."

But there are new regulations surrounding data-handling. Ethics and privacy, combined with growing consumer awareness of the security issues relating to personal data use, present retailers with challenges when it comes to leveraging the full potential of customer data. Dealing with such information responsibly is a growing priority.

It also points to the unrelenting wave of high street closures and several long-established fashion retailers "taking refuge in CVAs". Customers are making fewer purchases at bricks and mortar stores and buying more online, which is having a major impact on brands and retailers.

Retail Economics chief executive, Richard Lim, 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.”

"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.