Congressional Committee Hears E-Commerce Privacy Seals On The Rise

Virtually no one disputes the fact that the future of e-commerce is dependent on public trust and the perception that sitting down at a computer terminal to buy goods and services is as safe as the checkout line of a superstore in Anywhere, USA.

That indisputable message is precisely the one that a representative of the industry conveyed to the House of Representatives Judiciary Committee’s Sub-Committee on Courts and Intellectual Property this week, when he said that the use of privacy seals on Web sites is increasing rapidly.

Building A Comfort Level

“The growth of interest in seal programs is clearly linked to one factor: the desire to build a Web environment that consumers feel comfortable in,” Terry Pittman, a member of the Board of Trustees for the TRUSTe seal program.

Pittman told the sub-committee that some 700 Web sites have joined the TRUSTe program since its inception in 1997 and that he expects that 1500 sites will have signed on by the end of the year. TRUSTe and Verisign are two of the most prominent privacy seal programs currently being used on the Internet.

Still No Guarantees

While they do offer a comfort level to consumers, privacy seals are not an ironclad guarantee that a viewer of a particular Web site will not encounter an e-commerce pothole.

Web sites which participate in privacy seal programs essentially tell a consumer that the site will disclose details on what personal information is being gathered on them, how it will be used and who it will be shared with, if anyone. Perhaps most importantly, they offer choices regarding how the consumer wants the information to be used.

A recent study by Cheskin Research and Studio Archetype/Sapient concluded that the six fundamental e-commerce trust issues include brand name, navigation, fulfillment, presentation, up-to-date technology and security guarantee logos and privacy seals. A Web site that pays attention to these details will instill consumer confidence, the study concludes.

Industry Leaders On Board

TRUSTe is having no problem convincing e-commerce merchants of the merit of such an argument. Among its licensees are ABCNews, AOL, CNET, Disney.com, Microsoft, PlanetRX, Yahoo! and ZDNet. Some 88% of all users visit a TRUSTe-licensed site each month, according to Media Metrix and those sites account for 25% of all Web traffic.

Licensees pay a fee based on its annual revenues. For instance, a company making between 0 and $1 million (US$) pays $299 a year. One making $75 million and over pays $4,999 annually.