Need to Know
- IKEA has announced changes to its data collection practices that will give customers full control over the way it collects and uses data on digital platforms.
- Customers will be able to decide if the retailer has access to information such as browsing history, previous purchases, shopping preferences, and even abandoned carts.
- The new privacy controls will appear as easy-to-understand digital messages placed throughout IKEA’s digital shopping experience.
Ikea’s new data collection program carries on the retailer’s infamous do-it-yourself traditions, letting customers decide just how much information the company can collect on them.
The “DIY data” initiative will let shoppers decide through a series of easy-to-understand digital messages whether the company can collect information such as browsing and purchase history, product preferences, and abandoned cart data. The messages will appear throughout the digital shopping experience as well as a centralized control panel.
“We are doing this because we believe it’s the right thing to do and we believe it makes business sense to respect people’s data,” Barbara Martin Coppola, chief digital officer at Ingka Group (Ikea’s owners) told the Wall Street Journal.
Consumers want control over their personal data. A study from Janrain found that 91% of those surveyed expressed a desire to have more control or block companies from using their personal data. Ikea’s new fully-transparent data controls place the furniture chain in a strong position to earn customer trust. Nearly 80% of respondents in the same survey said they only wanted to buy from trusted retailers.
“This seems like a purpose-based move to try and set IKEA apart from the pack by appealing to the emotional side of the millennial consumer equation,” said George Manas, president of OMD USA, a media-buying agency owned by Omnicom Group Inc.
Retailers such as Ikea use data to personalize results for shoppers. For example, if a shopper has purchased a bedframe recently, Ikea may use that data to recommend a bedside table, pillows, or other bedroom furniture sets. Ikea is betting on its vast product catalog and deep brand recognition to circumvent the use of personalization data, instead allowing customers to explore items and choose using their own judgment.
Other e-commerce leaders are making similar moves with their data collection policies. Amazon customers are able to customize purchase recommendations and Walmart’s privacy options include links to opt-out of the ad networks. However, Ikea has an ace in their pocket: they haven’t built a business around selling ads to their customers in the same manner Walmart and Amazon do.
With IKEA’s digital sales up 50% at the end of 2019, and the retailer making substantial changes to its business plan to focus on digital sales, increasing customer trust and “Ikea-izing” (build it yourself!) the retailer’s data controls seems like the right move at exactly the right time.
IKEA says customers can expect to see the controls debuting on the IKEA app in France this April, and hope to make it available globally shortly after.