Emma Okonji
About 70 per cent of Nigerian businesses are unaware about the privacy laws governing their marketing activities and they rely heavily on third-party trackers and ad platforms, according to a report.
The survey findings showed that only 30 per cent of Nigerian businesses are aware of privacy laws governing their marketing activities, despite Nigeria Data Protection Regulation (NDPR) 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, the report stated.
Analysing the report, the CEO of WorldWideWorx, Arthur Goldstuck, said lack of awareness about the law was largely because these regulations are not part of business-critical activities like taxation and licensing.
“However, 78 per cent of the businesses indicated that they have well-documented policies for customer data protection. This is likely following fear of NDPR violation, which has made headlines in Nigeria. Even so, only 60 per cent are strictly applying them,” Goldstuck said.
The report noted that of the 319 businesses surveyed across various industries and sizes, 45 per cent said they allow third-party trackers on their website, mostly for sharing content on social media, which recorded 62 per cent and gathering analytics on their website visitors, which recorded 35 per cent.
There is also a heavy dependence on digital ad platforms. The respondents believe that keyword search ads, which is 59 per cent and social media ads, which is 52 per cent, are quite effective for customer conversion. 78 per cent of businesses said the third-party ad platforms either help them meet or are a primary factor in achieving their sales goals, the report said.
According to the report, “Given this reliance on third-party vendors, it is no wonder then that, even though 85 per cent 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. Even the 18 per cent who are ‘uncomfortable’, state that 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 per cent businesses reported that they do not completely understand how third-party trackers and ad platforms utilise the collected customer information.”
The Regional Manager for Africa at Zoho, Andrew Bourne, said: “When businesses choose to use a free tracker, they are paying for it with their consumer’s data. At Zoho, we refer to this practice of third-party trackers collecting data without user knowledge as adjunct surveillance. Presently, Nigerian 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 report further said Nigerian businesses believed that NDPR has had either no effect or a positive effect. Their biggest concerns with the law are increased complexity, which is about 36 per cent and the increased cost of governance, which is about 34 per cent. It added that as per Goldstuck, the cost of governance will be a major concern for SMEs.
The report explained that all businesses in Nigeria, regardless of size, need to appoint a privacy/information officer to oversee the protection of customer information. It said larger businesses can appoint their Chief Information Officers (CIOs) or Information Technology (IT) leads in this new role, while smaller businesses may have to appoint their managing directors or business owners in the same role.
