It's a frequent and seemingly harmless occurrence in the auto industry. A customer interacts with a dealership and provides personal data to secure financing, book a service appointment or take a test drive. This consumer data is fed through numerous systems and platforms in the routine course of business. As normal as these situations seem, they have sparked intense debate about whether dealerships should have easy, unfettered access to data they collect from customers.
Under the guise of data security and privacy, some red flags have been raised that dealerships should not be able to easily access their own data and share it with other vendors. Access and flow of data to third parties can leave consumers vulnerable, some argue.
This argument, however, creates a false choice for dealerships. Data security and access isn't an either/or proposition. As lawmakers, business leaders and consumer advocacy groups continue to look for the right answers to consumer protection policy, three key principles should guide every discussion:
1. Consumer data should be secure no matter where it's stored.
2. A business that legally collects data should have full ownership and access to that data even when it's stored with a third-party vendor
3. All costs associated with data access and integration support should be 100 percent transparent.
Dealers' right to access their data is self-evident. Simply enabling security and capabilities should never limit or financially encumber a dealer.
I advise dealers I speak with that a good rule of thumb is to "follow the money." A tech provider should be able to tell you exactly what your costs will be and clearly explain the value they are adding in terms of data processing, storage, analysis or integration support. Fees should be justified by value, not by a business model.
Creating business practices and regulations with these three principles is important because a compromise on either will hold back automotive retail to the detriment of all. Security is clearly important in this market and is simply the right thing to do.