Outsourced marketing raises data breach risks

Do not outsource your online...

Do not outsource your online marketing if you want to attract and keep customers.

That is the conclusion of market researcher Ponemon Institute, which surveyed 900 British IT and marketing professionals on whether their online marketing activities breached customers' privacy.

Ponemon, on behalf of internet security firm Strongmail, found two-thirds of firms had suffered data breaches, even though three-quarters believed their organisations complied with privacy laws and regulations. Fewer than one in five would tell the customers concerned if their information was disclosed.

Half of those who reported breaches said the breach was due to the outsourcing of personal information to third-party marketing organisations. Marketers said these breaches had cost the firm new and existing customers.

More than seven in 10 firms understood that personal data may not be shared with third parties.

Despite this, data protection professionals said they would share information on gender (73%), home address (66%), name (65%), cellular phone (53%), e-mail address (52%), home telephone (46%) and marital status (46%), Ponemon found.

Marketers are most likely to share gender (87%), name (86%), home address (85%), e-mail address (81%), marital status (80%) and home telephone (73%), it said.

But only 4% of data protection professionals and 3% of marketers would share individuals' national ID. Both groups would not share job performance data, movie rental history and biometrics (voice, fingerprint).

Both groups said e-mail (75%) and internet marketing channels (70%) threatened consumers' privacy and personal data. Nine of 10 marketers believe that privacy requirements such as opt-in and opt-out choices hinder their marketing practices, but only 13% of data protection professionals felt this to be true.

Most firms outsource their online marketing campaigns to third-parties to save costs, and to achieve better quality of service and greater efficiency. Protecting customer data is a main reason why some firms choose not to outsource, Ponemon said.

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