Shopify Ecosystem

How To Create A Data Privacy Policy For Your ECommerce Store

how-to-create-a-data-privacy-policy-for-your-ecommerce-store

You’ve probably heard of shoppers losing a lot of money to identity theft, especially after shopping online. Whenever you buy something from an eCommerce website, do you ever stop to wonder whether they keep your personal information securely?

Creating a data privacy policy for your website is the first step in keeping your customers’ data safe, which results in higher customer satisfaction and retention. It’s also a requirement for e-commerce businesses operating in most countries. I will show you how to create a data privacy policy for your eCommerce store and share a few examples that you can emulate.

1. Know the industry standards

Data privacy policy requirements vary greatly from one industry to the next. Sometimes the policies can even vary within the same industry depending on how and where a store is conducting its business.

For example, if your online store collects cookies for re-marketing or retargeting, you must disclose this on the privacy policy. Similarly, if your online store attracts minors, you’ll have to include a policy addressing that. And if you market your products to children directly, you have to follow the Children’s Online Privacy Protection Act (COPPA) regulations.

For example, The Walt Disney shop has an entire page dedicated to children’s online privacy policy.

Source: Disney Shop

Therefore, to create a comprehensive eCommerce privacy policy, you must first understand the requirements and standards of your industry and location.

Beyond your industry, ensure any third-party service providers linked to your website (e.g. payment provider) are fully compliant with necessary regulations in their industries. 

The good news is that having a clear privacy policy is a norm for top service providers in eCommerce. For instance, Judge.me applications are compliant with most critical regulations including the General Data Protection Regulation (GDPR) and California Consumer Privacy Act (CCPA). We’ve developed certain features to make sure the privacy rights of store owners and reviewers are protected according to these regulations.

Once you are familiar with industry standards, you can start auditing or inspecting your website to see if it is compliant with the guidelines. 

Many eCommerce store owners do not build their websites. Most of them are also not involved in the day-to-day technical aspects of an eCommerce website.

If that’s the case for you, you’ll need to sit down with your developers or IT department for a chat on your site’s data practices. Find out what data is collected, where it is stored, how long it is stored, who it is shared with, why it is shared, etc.

The data will help you create a comprehensive privacy policy, which should save you from expensive legal implications.

2. Decide who will be responsible

The best way to ensure your eCommerce store is compliant with data privacy regulations at all times is by assigning the task to an expert. You could do this by hiring an in-house lawyer. 

However, privacy regulations can be very complex. And if your business operates across multiple jurisdictions, following all regulations can become even more difficult. For example, if you sell products in California, you’ll need to follow the California Consumer Protection Act. 

Moreover, some laws get updated regularly.

It might be a good idea to outsource these services to firms that specialize in data privacy policies with all this in mind. That doesn’t just take the taxing work off your shoulders, but it should also give you some peace of mind knowing a team of experts is handling the legal stuff for you.

3. Include the company and contact information

Creating a data privacy policy is not just about making your business compliant with the set regulations. The policy is also good for building customer relations. A good privacy policy makes customers trust you more.

Including your contact details in the policy makes your business look even more transparent. It allows customers to reach you with ease any time they have privacy concerns.

Source: ASOS

Provide a phone number or email address and make sure the person behind that contact is well familiarized with your company’s privacy policy.

4. Determine what to include in your data privacy policy

In addition to telling your customers what data is collected, disclose how it is stored, for how long it is stored, and under what circumstances the data is shared.

For example, if a customer has to create an account when making a purchase, you’ll request personal information like name, email address, telephone number, and shipping address.

Source: Macy’s

Data retention periods vary across geographies and industries. The GDPR, for example, doesn’t have a set data retention period but allows companies to set their guidelines as long as the reasons are justified and documented. Some businesses keep customer data for as long as the customers are still using their products/services, while others store customer data indefinitely by anonymizing it. 

Credit card details are especially delicate. Transactions made using debit or credit cards fall under the PCI DSS (Payment Card Industry Data Security Standard). This is a set of rules that govern the types of data different kinds of businesses can store, and for how long. Most clients want to know how much of their payment details are disclosed to you and the payment processors. Point this out in your data privacy policy. 

Your privacy statement should also have a dedicated section on data sharing. For example, if you use third-party marketing tools like GetResponse, tell your customers what data is shared and why.

Source: Lowe’s

While writing this policy, be sure to use easy-to-understand language. Don’t fill your policy with legal jargon that your customers cannot understand. Use simple words and utilize a grammar checker to ensure your policy is written professionally.

The GDPR also requires businesses to give users some control over their data. For example, users may have the right to update or delete their personal data from a given vendor.

Source: Argos

If your business extends such rights to customers, consider mentioning it on the privacy policy. You could add the statement alongside the contact details and ask your customers to get in touch if they want to exercise their data control rights.

5. Modify and update regularly

Privacy policies tend to change a lot. The laws that apply to your business could also change when you introduce new policies.

To ensure your policy is always fool-proof, modify and update it regularly. You could revise the policy once per year or every time you implement a dramatic change in your business model.

You should also consider letting your customers know when your privacy policy is updated. You could easily do this with an email blast.

Wrapping Up

All eCommerce stores are legally required to have a data privacy policy. Failure to have one can result in expensive fines and other legal issues. So, use the above tips to create a policy for your online store.

Special thanks to our friends at Judge.me for their insights on this topic.
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