Website Data Privacy: The What & Why

Digital, Website Design & Development, General

Read Time: 11 Min

Data is the fuel for an increasing number of businesses in an ever-evolving digital landscape. Companies are leveraging user data to personalize customer experiences, automate marketing messaging, and collect science-driven insights to further their business strategies and agendas. Because of this, naturally, they are eager to gather more and more data.

It is key to protect the privacy and safety of individuals on the web — that’s where website data privacy policy comes in. The emergence of data privacy laws came about because of a growing need to protect individuals and give them control of data.

 

What is Data Privacy?

Data privacy refers to the protection of individuals’ personal information which is collected, processed, and stored by websites. It involves ensuring that users have control over their data and that it is handled securely, ethically, and by applicable laws and regulations.

We take data privacy very seriously, and want to ensure that our clients and those reading this article are as educated as they can be, to continue to do what we do best: put people first.

Forewarning: This insight is chock-full of detailed information and our expertise on this subject, so buckle up and get ready to learn everything there is to know (or most of it at least) about data privacy.

 

Table of Contents:

  1. Key Aspects of Data Privacy
  2. Understanding Data Privacy Regulations
  3. Data Collection Practices
  4. Transparency and Consent

 

Key Aspects of Data Privacy on Websites

By taking data privacy seriously, organizations can mitigate legal and reputational risks, demonstrate their commitment to responsible data-handling practices, and most importantly, build trust with users by proving their integrity.

Let’s take a look at what we’ll go over throughout this insight:

  1. Transparency: Your website should always share with users what types of data you are collecting, how it will be used, and with whom it is being shared.
  2. Consent: Always get the okay from users before collecting, processing, or sharing personal data.
  3. Data Minimization: Avoid misuse of data by collecting only what you need and retaining it only for as long as you need it.
  4. Security: Ensure you implement appropriate security measures to protect users’ personal data.
  5. User Rights: Respect users’ rights to access, rectify, delete, and object to the processing of their data.
  6. Third-Party Data Sharing: Ensure third parties adhere to similar data privacy standards and obtain consent from users before sharing with, for example, advertisers or analytics providers.
  7. Data Breach Response: Ensure you have procedures to detect, respond to, and mitigate data breaches promptly.
  8. International Compliance: Ensure you comply with relevant data privacy regulations if you operate globally or serve users from multiple jurisdictions.

 

What Are Data Privacy Regulations?

It was inevitable that as data became more and more important to companies, the government would need to do something to further protect user privacy. The following regulations are just two examples of the many put in place across the world. Many other countries have enacted or are in the process of enacting data protection legislation to address the growing concerns around privacy in the digital age. To learn about hte other many U.S. based data privacy laws, check out Termly.com.

General Data Protection Regulation (GDPR)

The GDPR is a data protection and information privacy law that was enacted in the European Union in 2018 and has been enforced since then. It is the first of its kind and one of the most strict. It applies to all organizations processing the personal data of EU residents, regardless of the organization’s location, so even U.S. companies must comply. This law includes four important points to remember:

  1. It requires consent for data processing.
  2. It requires explicit consent for sensitive data. Explicit consent means that cookies are not stored unless the user consents.
  3. It requires notification of data breaches within 72 hours.
  4. It gives individuals rights to access, rectify, erase, and object to data processing.

Since it’s inception, the GDPR has led the way for other countries and jurisdictions to enact similar laws.

The California Consumer Privacy Act (CCPA)

The U.S. is catching on and states are slowly enacting laws akin to the CCPA, which was enacted in 2018 and became enforceable in 2020. These states include Virginia, Colorado, and Utah (whose laws went into effect in 2023).

The CCPA has formed a basis for how all these other laws are being written. This law applies to businesses that collect personal information from California residents and must meet certain criteria (e.g., annual gross revenue, amount of data processed). It gives consumers rights over their personal information, including the right to know, delete, and opt out of the sale of their data. Businesses must provide notices about data collection practices and implement reasonable security measures.

The CCPA differs from the GDPR in that it requires implicit consent, which means cookies are stored unless the user rejects them.

Don’t be fooled into thinking these regulations are ‘just suggestions,’ non-compliance with data privacy laws can have consequences for websites and the organizations behind them. The severity depends on various factors, including the specific law violated, the nature and extent of the non-compliance, and the regulatory authorities involved. Some penalties include:

  1. Fines.
  2. Lawsuits.
  3. Reputational damage and negative publicity.

 

Data Collection Practices

Websites collect all kinds of data from users for all sorts of different reasons. Data types can include personal, behavioral, and locational to name a few. Websites may collect IP addresses to determine a user’s location, information about how a user interacts with websites, information about the browser and the device used, and browsing history. Companies will do this by collecting cookies. Do you know that little box that pops up when you visit a website asking for your consent to collect cookies? They aren’t talking about the warm, gooey treats. Cookies are data and there are two types: First-party and third-party data, both of which are used to track user interactions on a website. However, they have distinct differences in terms of their origins and purposes. Let’s break down first vs third party data:

First-Party Cookies

  1. Origin: First-party cookies are set by the website domain the user is currently visiting. They are created and stored by the website owner’s server and are associated with the specific domain of the website being visited.
  2. Purpose: They are primarily used to enhance user experience by remembering user preferences, login information, shopping cart contents, and other settings. They enable website functionality and facilitate activities such as session management and website customization.
  3. Examples: Login cookies, session cookies, preference cookies, and shopping cart cookies.
  4. Privacy Implications: Since first-party cookies are directly controlled by the website owner and are limited to the domain of the website being visited, they typically pose fewer privacy concerns than third-party cookies.

Third-Party Cookies

  1. Origin: Third-party cookies are set by domains other than the one the user is currently visiting. They are created and stored by third-party servers and are often associated with advertising networks, analytics providers, social media platforms, or other external entities.
  2. Purpose: Third-party cookies are primarily used for tracking user behavior across multiple websites for purposes such as advertising targeting, retargeting, cross-site analytics, and personalized content delivery. They enable advertisers and data brokers to build profiles of users’ browsing habits and interests.
  3. Examples: Advertising cookies, tracking cookies, social media cookies, and analytics cookies.
  4. Privacy Implications: Third-party cookies raise privacy concerns because they can be used to track users’ online activities across different websites, potentially without their consent. They enable third-party entities to collect and aggregate user data for targeted advertising and profiling purposes, leading to debates about user privacy and data protection.

Because website owners have direct control over first-party cookies, and third-party cookies are controlled by external entities, data privacy concerns, and cookie privacy issues are increased for third-party cookies and cookie compliance is of utmost importance. The differences between the two types of cookies are key when understanding data privacy and data protection and the strategy behind data collection for businesses.

 

What Are The Methods Of Data Collection

We talked about cookies already, and we’ll touch on it again, but there are many more methods for companies to collect data from their users. These methods can vary depending on the context, objectives, and nature of the data being collected. Let’s take a look at a few:

Direct User Input

Businesses may provide online forms for user registration, feedback, and subscriptions to collect data. These surveys, questionnaires, and other forms of feedback are a great way to collect user opinions and preferences with their consent and knowledge.

Automated Tracking and Monitoring

This is where cookies come in. First- and third-party cookies work automatically in the background to track user behavior and preferences. This type of automated monitoring tracks pixels, web beacons, and log files to monitor website interactions, including page views and clicks.

Analytics Tools and Integration

This is a fairly commonly understood method of data collection. Most companies have a method for tracking and understanding Google Analytics. These tools track website traffic, user engagement, and conversion metrics. Analytics data collection can also be integrated with social media platforms and APIs for collecting data from external sources.

Transactional Data

If your company offers a product or service that can be purchased on a website, this type of collection method gathers data generated from online transactions, such as purchase history, payment details, and order preferences. This collection method also gathers sensor data from internet-connected devices, including smartphones, wearables, and IoT devices, for real-time monitoring of user activities.

User Engagement Tools

Any form of user engagement on your site can be included under this method. We’re talking about social media plugins, sharing quizzes, polls, and contests — any method used to engage users and gather data on their preferences and interests.

All of these methods enable organizations to collect a wide range of data from users and digital interactions, which can then be used to personalize user experiences, target people, collect analytics, and improve user experience altogether.

 

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What About Data Privacy Transparency and Consent?

Collecting and processing users’ personal information is a touchy subject. To maintain trust with your customers and fortify the overall integrity of your business, you must prioritize transparency and consent within your data privacy compliance initiatives. Here’s an elaboration on the best practices for informing users and obtaining consent:

Transparency

There are two easy, effective ways to be transparent with your users about data collection.

  1. A Clear Privacy Policy: Your privacy policy should be easy to find, clear, and comprehensive. It should explain how you collect, use, store, and share user’s personal information. Ensure your privacy policy is written in language easily understandable by the average user.
  2. Informational Notices: At key points of data collection, include informational notices or popups such as registration forms, contact pages, or checkout processes. Clearly state what data is being collected, why it’s being collected, and any third parties with whom it may be shared.

Consent

Consent involves getting the okay from users before collecting, processing, or sharing their personal information, especially for sensitive data or data used for marketing purposes. We touched on it a bit in the data privacy regulation section where we went over implicit and explicit consent. No matter what kind of consent you are obtaining, it’s important to use clear language to explain what users are consenting to and provide them with options to accept or decline. Here are a few other types of consent:

  1. Cookie Consent: These are the pop-ups we talked about earlier. You may have seen them. Using these popups or cookie consent banners informs users about the use of cookies on your website. Granular consent options allow users to choose which types of data they are willing to share and for what purposes. Implementing preference management tools or consent management platforms (CMPs) will help facilitate this process.
  2. Document Consent Records: To demonstrate compliance with data privacy regulations, maintain records of all your users’ consent, including the date, time, and specific concept preferences. You can have a CMP do this for you.

 

Feeling Good About Website Data Privacy Policy?

We sure are. It’s something we think about all the time when working with our clients. Part of our job is sharing this kind of expertise and helping our clients understand the legal and ethical aspects of website data privacy. We went over a lot in this insight: the key aspects of data privacy, data privacy regulations, first versus third party data, methods of data collection, and the importance of transparency and consent. Hopefully, all of this information will encourage you to understand the importance of data privacy, what it is, and how it can impact your business.

If you want to learn more and are interested in having us do all the thinking for you, give us a call. We love to talk about data privacy, after all, we are a people-first agency, and we want to help our clients put their people first too. In the meantime, take a look at some of our work to see all this data privacy ‘stuff’ in action.

 

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