Privacy Seal Program: Will Consumers Embrace Privacy Seals?

After completing a sale with an online merchant, your personal information is now in their hands. Now a well-known offline consumer protection group is offering a solution to online privacy concerns.

What do companies do with your personal information after you’ve placed an order? That question has bothered online consumers since the growth of the Internet as a commerce vehicle. The online subsidiary of the Better Business Bureau, BBBOnline, recently launched a program where they will award “seals of approval” to Web sites that agree to post policies on how they collect personal information from their customers and what they do with that information.

Companies state that they adhere to their privacy policies, but many of these same companies claim that their membership lists are one of their most important assets. Consumers have no way of knowing which Web sites protect the sensitive information they collect from consumers.

Enter the BBBOnline privacy seal program. Privacy seals on the Internet are not a new concept. A nonprofit group, Truste, was established two years ago to award “seals of approval” to Web sites that meet its privacy standards. However, the obscure program never took hold with the public. The BBBOnline is banking on one advantage it has over Truste — name recognition. Consumers are familiar with and trust the Better Business Bureau.

“I’ve never heard of Truste, but I’ve heard of the Better Business Bureau” says Peter Tomaino, an accountant from Connecticut who has been on the Net for the last three years. “But I’d be skeptical of both programs until I knew how they were funded.”

Tomaino raises a legitimate question. Will the BBBOnline and Truste be objective? Such companies as Microsoft, AOL and AT&T have sponsored both organizations. How will the BBBOnline and Truste treat such companies? For example, how will they investigate the claim that Microsoft’s Windows 98 registration creates ID numbers that can track users at Microsoft sites? How the organizations handle such situations will ultimately determine whether they gain the public’s trust

Although consumers may remain skeptical of the BBBOnline seal, e-commerce sites are definitely taking notice. More than 300 companies have already begun the application process since the program was announced. To display the seal, qualifying companies must pay $150 to $3,000 per year depending upon a company’s sales and net worth.

One of the first companies to display the seal was the Dell Corp. []. When users click on the privacy seal at the Dell site, a small window appears that explains what the icon is. The window also contains links to a page containing Dell’s online privacy policy, a page detailing BBBOnline’s privacy program’s standards and a page with contact information for BBBOnline.

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