Protecting Consumer Data

Protecting Consumer Data: Best Practices for Online Retailers


As online shopping grows exponentially, retailers are gathering more sensitive customer data than ever before. Credit card details, personal information and browsing history need to be handled with care by ecommerce businesses. Neglecting consumer data protection can severely damage customer trust and a retailer’s reputation, not to mention risks of payment fraud. Implementing rigorous privacy and security measures is essential.

Limiting Data Collection

Online retailers should only gather customer data that is strictly necessary for business needs. Extraneous personal information and browsing history that goes unused creates unnecessary risk. Being transparent about why specific customer data is required can help build trust. Providing privacy controls for customers to update preferences also demonstrates respect for personal information while empowering consumer choice. Only capturing essential customer data also simplifies compliance requirements for data handling.

Securing Sensitive Data

Once customer data is gathered, retailers must apply robust controls around accessing, sharing, and storing that information. Setting permissions so that sensitive personal and financial data is only available to essential staff reduces risks of internal misuse or external hacking. Enforcing multi-factor authentication adds another layer of access security. Encrypting all databases, communications, and devices where customer data resides protects that valuable information if devices get compromised.

Limiting Data Retention

Online retailers should keep customer data only as long as necessary to serve the customer, fulfill orders or meet legal obligations. Setting clear data retention policies around personal and payment information shows respect for privacy while reducing a retailer’s risk exposure over time. As a rule of thumb, payment details should be stored only until the end of the typical refund period. Personal information relevant to the customer relationship should be kept active until the typical period of inactivity passes. Outdated or irrelevant data should get purged automatically per set schedules.

Prioritizing Payment Security

With online fraud and theft still major issues, protecting payment information is paramount for retailers. Isolating payment processing systems from other networks, enforcing P2PE encryption and requiring CVV codes helps prevent payment fraud issues. According to the folk at fraud prevention experts Outseer, disallowing retention of CVV codes and restricting access to full payment details also reduces risks if a retailer gets breached. Rigorously vetting payment partners, requiring PCI compliance, and regularly testing systems help identify and address payment security gaps before issues occur.

Preparing Incident Response Plans

Despite best efforts, consumer data breaches can still happen. Retailers need comprehensive response plans for communicating with customers, resolving fraud issues and meeting disclosure obligations in the event of an attack. Incident response plans demonstrate retailers have carefully considered their legal and ethical responsibilities around customer data.

Emphasizing Consumer Awareness

Online retailers relying on customer trust must prioritize data security and transparency in their operations. Highlighting privacy controls and protections on websites reassures consumers. Retailers should provide regular staff training on safe data handling and require cybersecurity commitments from partners. Promoting awareness around fraud prevention also engages customers in thwarting payment risks.

Fulfilling Compliance Requirements

As data protection regulations multiply, online retailers must stay current on evolving compliance rules around consumer privacy and information security. Regular audits help confirm that policies and procedures meet legal obligations around financial, personal, and other sensitive customer data. Verifying that privacy policies reflect actual practices is important, along with maintaining compliance documentation. Keeping abreast of new or updated regulations reduces any risks of non-compliance claims or fines.


Online retailers thrive based on customer trust and convenience. Protecting sensitive user information through data security and responsible privacy practices must be central to eCommerce operations. As risks around consumer data breaches and payment fraud persist, vigilant retailers implement strong technical and procedural safeguards while keeping customers informed.

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