A new survey has now shown that only 36 percent of Kenyan businesses are aware of privacy laws governing their marketing activities, despite Data Protection Act (DPA) being in effect since 2019.
The survey, conducted by WorldWideWorx and commissioned by global technology company Zoho, also revealed that even though businesses are concerned about the privacy of customer’s data in the hands of third-party vendors, they are reliant on them for revenue generation and gathering customer insights.
This makes it harder for them to move away.
According to WorldWideWorx CEO Arthur Goldstuck, the lack of awareness about the law is largely because these regulations are not part of business-critical activities like taxation and licensing.
However, 77 percent of the businesses indicated that they have well-documented policies for customer data protection, although only 56 percent are strictly applying them.
The survey indicates that businesses in Kenya consider themselves digitally advanced, with 28 percent respondents saying they were completely digital and 18 percent saying they were close to being completely digital.
Of the 352 businesses surveyed across various industries and sizes, 58 percent said they allow third-party trackers on their website, mostly for sharing content on social media 64 percent, tracking affiliate relationships 45 percent and ad campaigns 43 percent.
The survey also reveals that there is also a heavy dependence on digital ad platforms. The respondents believe that keyword search ads at 36 percent and social media ads at 62 percent were quite effective for customer conversion.
As such, 84 percent of businesses said the third-party ad platforms either help them meet or are a primary factor in achieving their sales targets.
Given this reliance on third-party vendors, it is no wonder then that, even though 56 percent of businesses express concern over the use of their customer’s data, they are largely either ‘comfortable’ or ‘neither comfortable nor uncomfortable’ with the platforms.
The survey also shows that even the 10 percent who are uncomfortable state they cannot move away from the platforms as they are crucial to their business or that it is too complex to move away.
Interestingly, 24 percent businesses reported that they do not completely understand how third-party vendors utilise their customer information.
“When businesses choose to use a free tracker, they are paying for it with their consumer’s data,” said Andrew Bourne, Regional Manager for Africa, Zoho.
“At Zoho, we refer to this practice of third-party trackers collecting data without user knowledge as adjunct surveillance. Presently, Kenyan businesses turn a blind eye to this passive data collection by trackers, most likely, because they are dependent on them for revenue. However, consumers will eventually trust companies with transparent privacy policies that protect their personal information. Businesses hoping to stay relevant in the long term will need to either rethink their reliance on third-party platforms or demand greater transparency and accountability from them.”
The firm had removed third-party trackers from its website in 2020, and has never sold customer data to anyone or shown ads, even in their free products. Zoho also owns its data centres and the entire technology stack of its solutions. It can, therefore, assure its users of the highest standards of privacy and security.
Kenyan businesses believe that DPA either has had no effect at 46 percent or a positive effect at 39 percent. Their biggest concerns with the law are increased cost of governance at 45 percent, increased complexity at 27 percent and the loss of analytics data at 29 percent.
South Africa and Nigeria
The survey, which was also carried out in South Africa indicates that only 22 percent of South African businesses are aware of privacy laws governing their marketing activities, despite the Protection of Personal Information (POPI) Act set to take effect on Thursday, 1 July.
It revealed that even though businesses are concerned about the privacy of customer’s data in the hands of third-party vendors, they are reliant on them for revenue generation and gathering customer insights.
While 76 percent of the businesses indicated that they have well-documented policies for customer data protection, only 57 percent are strictly applying them.
“When POPIA comes into effect and defaulters face severe fines and garner negative media attention, most companies will start complying fully and restructure their marketing operations,” says Goldstuck.
Of the 448 businesses surveyed across various industries and sizes, 42 percent said they allow third-party trackers on their website. This is mostly for sharing content on social media at 55 percent and gathering analytics on their website visitors at 40 percent.
In Nigeria, only 30 percent of Nigerian businesses are aware of privacy laws governing their marketing activities, despite the existence of the Nigeria Data Protection Regulation (NDPR).
Goldstuck said the lack of awareness about the law is largely because these regulations are not part of business-critical activities like taxation and licensing.
78 percent of the businesses surveyed indicated that they have well-documented policies for customer data protection.
Of the 319 businesses surveyed across various industries, 45 per cent said they allow third-party trackers on their website, mostly to share content on social media (62 per cent) and gather analytics on their website visitors (35 per cent). There is also heavy dependence on digital ad platforms.
This study was conducted using Zoho Survey and Zoho Analytics.
