Online Retailers: Will Your E-Commerce Tools Survive Federal Data Privacy Regulations?

Written by Swalé, Founder, Iuncta

When did e-commerce and data collection become synonymous? Was there a particular point in the evolution of online shopping where this phenomenon was established? Whose thought leadership made the concepts interchangeable and accepted? What I’m trying to ask is, whose idea was this? As a startup founder, I’m an ideas guy, a problem solver. That’s the first step in starting a business: identifying a problem and coming up with a solution… that is profitable. It just so happens that my startup up is a fintech and my customers are online retail brands. One thing I know for sure is that most e-commerce tools in the market were created to solve a singular yet universal problem specific to retail brands — that is the problem of conversions.

I’ve personally innovated across industries, and my design approach prefers that I lead with empathy and then follow by a subsequent analysis of data collected to help solve a particular problem. Now, everyone’s approach to problem solving is different, and I’ve always been one to appreciate perspectives outside of my own. But what I’m seeing happening in e-commerce is just out right nefarious. It is massive data collection in an unregulated market, funded by surveillance capitalism and disguised as an e-commerce tool.

It is as if though the creators of e-commerce tools collectively agreed to make the effectiveness of their platform contingent upon the greatest amount of user monitoring and tracking possible. There is a functional dependency on data capture and the approach almost seems backwards; a sudden desire to make the data important because they can collect it, as opposed to collecting it because the data is important. The result of this paradigm forces competing and newer e-commerce tools to not only be the first to the user data but the most invasive, to get as much of it as possible. Then we end up with what’s happening today: e-commerce tools that make most of their revenue from the sale of user data rather than from the service the tool actually advertises to retail brands.

Who is at fault? When the laws are slow to adapt to the rapid rate of technological advancement and digital transformation, you get exploitation of the system. Is it really a crime of opportunity if the act is still not yet considered a crime? America still doesn’t have a singular law that covers the privacy of all types of data. Instead, it has a mix of laws that go by acronyms like HIPAA, FCRA, FERPA, GLBA, ECPA, COPPA, and VPPA. What does this means for the future of the industry? Well, regulation will ultimately come, and hopefully when it does come, it’s not too late. But in the meantime, the number of e-commerce tools available today is growing fast, but not many are really preparing for or will be in compliance with the future of e-commerce — a future that rests on identity protection and consumer data privacy.

It’s been interesting positioning Iuncta in the ecosystem of e-commerce tools, because it is inherently different; it’s like trying to fit in when you are a natural standout. Iuncta is a privacy-first, on demand e-commerce checkout solution that leverages the value in identity to eliminate the uncertainty in online shopping that leads to abandoned carts. I could have said it much more simply by just saying it’s an e-commerce tool that actually converts.

Iuncta’s model is based on a mutually beneficial partnership between consumers and brands instead of a broken model defined by brand advertising and consumer targeting. It’s unique because, unlike the others, it wasn’t designed off of an advertising platform blueprint but rather an enterprise grade–identity and access-management platform, so data privacy isn’t just something it promotes, it is intrinsic to its design.

There’s been an urgent need for federal data privacy regulations. In the absence of this, more consumers than ever before are seeking greater control over their personal information. They are demanding more from the retail brands they shop at — the same brands that are relying on e-commerce tools for increased conversions. But all is not lost. While this is happening, there has been an increase in advocacy and evangelism from technology stakeholders and organizations like The Rise Of Privacy Tech that are fueling privacy innovation. Iuncta continues to do its part to help pioneer a better way forward, that is not only viable today but is also future proof.