Tim de Sousa
Senior Director, FTI Consulting
In May 2021, former Australian Prime Minister, Malcolm Turnbull, made the claim, "I think that my generation – I’m in my mid 60s – is, I think, more sensitive to data than perhaps people in their 30s." This idea that young people don’t care about privacy is a common myth, and one that our privacy professionals at FTI Technology hear frequently among corporate and government leaders.
However, studies and surveys show that most young people care very much about privacy and how data about them is collected and used. In our experience of advising clients on how to build privacy into their products and services, we’ve seen firsthand that when businesses don’t invest in understanding their users (including younger demographics), trust (and revenue, by extension) can quickly dissolve.
In certain contexts, such as social media, young Australians (defined as 18 –24 years of age for this article) are more willing than older demographics to share personal information about themselves. Perhaps this is unsurprising given that 97% of Australian teenagers are social media users by the age of 17.
However, it doesn’t follow that young people don’t care about privacy simply because they are willing to share personal information on chosen platforms. In its 2020 Community Attitudes Survey, the Office of the Australian Information Commissioner (OAIC) found that 66% of young Australians said they feel the protection of their personal information is a ‘major concern’, and 81% of this group consider privacy either ‘very important’ or ‘extremely important’ when choosing a digital service. Similarly, the University of Sydney found in 2017 that two thirds of Australians under 40 years reported taking ‘active steps’ to protect their privacy online – the same as older demographics.
But it’s also clear that young Australians are far more likely to be effective than older demographics at protecting their own privacy. For example, according to the OAIC, young Australians were more likely to use ad blockers, Virtual Private Networks (VPNs), privacy-focused search engines or incognito mode to protect their privacy — 40%, as opposed to 30% for those over age 50. The OAIC also found that 25% of young Australians had changed a service provider due to privacy concerns (twice the national average), and they were more likely to have deleted an app or request that personal information is deleted.
So, what does this mean for businesses that create products and services that will be used by younger demographics? I recently discussed these issues with a former colleague and fellow data privacy expert Suzy Hur, who is currently the Senior Technical Product Owner at the property tech company Before You Bid. Suzy has deep experience in designing for a variety of digital platforms and services. We talked about how changing attitudes and expectations impact how designers build products and services.
Q: In your experience, do younger customers care about privacy?
"Oh, there’s no doubt," says Suzy. "Younger users are demanding transparency, and demanding that products be easier to use and that they respect their privacy… if they don’t trust the process or the product, they’ll walk away".
In fact, Suzy says, "younger generations are driving several market trends – they’re not as loyal to a particular brand as older demographics. You can see this in, for example, mortgages. They shop around and look for the best rates - they’re not scared to just switch if there’s a benefit for them, even if it’s a small benefit."
This trend is likely to increase, as developments such as the Consumer Data Right make it easier to switch between service providers.
Q: How do you take into account how different demographics use your products? What kinds of changes have you had to make?
Suzy says this is a big question for digital service providers and financial institutions in particular.
"One of the recent changes we’ve had to consider is how we pose account origination questions so they don’t seem intrusive or offensive." For example, it’s long-standing practice in many industries to ask for title (i.e., Mr., Mrs. Or Ms.), which reveals gender and marital status. "But, [younger demographics] don’t want to answer these questions because they don’t want to be targeted as a particular gender."
So, changing societal attitudes around gender is one example of how younger generations are driving practical customer experience discussions and privacy decisions that consider whether this information need to be collected, or collected in specific ways.
"These [younger] users don’t want to read several pages of text, or click through to a separate tab – they want a smoother experience."
Suzy also explained that many companies are being proactive and conducting demographic analysis to understand how to better communicate with different groups. Much of this depends on the form of communication. Recently, a financial services institution she previously worked with observed that over 40% of users opening new accounts online were doing so from mobile devices—largely younger users. The company responded to this obvious user need by creating an entirely new account origination process for mobile users. The intent, according to Suzy, was to build to be "mobile-first, mobile-friendly, aimed at young tech-savvy customers who want fast outcomes." The interface is more animated, and more interactive—and very different from the web interface, which is still favoured by older demographics.
"These [younger] users don’t want to read several pages of text, or click through to a separate tab – they want a smoother experience." The medium dictates the message in this instance – mobile users can struggle with large amounts of text on a small screen. "It’s important to make it easier for customers to understand what they are signing up for" says Suzy, for example, by providing pithy, just-in-time messaging that gives users essential information at the time that they need it to make a decision.
What should businesses do?
Consumers and customers are not a monolith. It’s critical to recognise that customer privacy preferences will differ from each other across a spectrum. In this way, privacy can evolve beyond simply being a compliance exercise into a competitive advantage.
It’s clear that younger generations are investing more in businesses that they perceive to be transparent, and that are not merely asking for trust, but are working to demonstrate that they are trustworthy.
This means that businesses that want to foster trust and brand loyalty and build their customer base must be more proactive in understanding the needs of their customers—including the differing needs of different age groups and demographics—and specifically build products and services to meet those needs.
To help achieve this this, we advise clients to implement ‘privacy-by-design' policies, systems and programmes. This involves thinking about privacy risks and issues in the early stages of a project, which enables mitigations to be more deeply and effectively integrated into the project.
One example of a privacy-by-design effort would be to conduct a privacy impact assessment early in a project to proactively identify risks, and engaging a privacy professional to work directly with project teams to help design privacy-protective products and services. This can help you to be more transparent with users of all ages and give them practical, useable and meaningful choices about how their data is used – enabling you to build deep, trusted relationships, and establish competitive differentiation.
The views expressed herein are those of the author(s) and not necessarily the views of FTI Consulting, its management, its subsidiaries, its affiliates, or its other professionals.