What is data transparency?

Adobe Experience Cloud Team

06-25-2025

Lead with data transparency to create personalized customer journeys

Data transparency is the practice of intentionally and honestly using data, according to the law and business ethics. It helps customers understand how businesses collect, use, store, and protect their data.

Companies collect a huge amount of customer information. Instead of veiling their data practices, data transparency encourages businesses to be open about how they manage that information. This includes:

Data privacy legislation requires businesses to practice data transparency. Across the European Union, the GDPR governs how organizations collect and use people’s data. In the US, individual states have created their own data privacy laws. In California, the California Consumer Privacy Act (CCPA) governs how personal data is collected and used. Other states with data privacy laws include Colorado, Utah, and Connecticut.

It can be tempting to collect a lot of customer data from the get-go and then figure out how you want to use it later. However, in today’s customer-centric landscape, leaders must clearly understand how their team uses customer data and why data transparency is essential for building trust.

Transparency in collecting and using customer data is a key part of customer data management and personalization. This article will explain data transparency and how to incorporate it into your organization.

In this guide:

The importance of data transparency.

Data transparency is an essential element of customer trust, especially given that 62% of people trust businesses. But even so, customers have good reason to question how companies are using their data.

Both regulated and unregulated industries need to care about transparency. Whether you’re held to industry regulations or not, it’s never been more important to ensure transparency in customer data management.

Security breaches, credit card fraud, and identity theft are all too common. Cybercrime is expected to cost $12 trillion in 2025. Unsurprisingly, consumers are becoming more familiar with the impact of sharing their data.

Data transparency is the antidote to declining customer trust. Your business must be honest about collecting, processing, storing, and destroying consumer data. This isn’t just good for your bottom line, but it can also help you better understand your customers. Violating trust can turn customers away for good. But if you can earn their trust from the start, they’re more likely to stand by you through thick and thin.

Plus, the more trusted the brand, the more people will share their customer data, strengthening your data personalization efforts. If customers aren’t sure whether they want to share data, you can highlight personalization's benefits to help them decide.

Privacy concerns vs. personalization expectations.

There’s a simultaneous demand for personalized experiences alongside growing privacy concerns about the customer data collection required to deliver them. This balance is crucial to understanding ethical and effective customer data management strategies.

Consumer concerns about data privacy are rising, with 86% of the US population in 2023 saying data privacy is a growing concern. A lack of awareness regarding the extent of customer data collection exacerbates this anxiety. Consumer comfort levels also vary significantly depending on the type of data collected. Over half of consumers are more likely to trust companies that limit their data requests to what is directly relevant to their products or services.

Data transparency benefits.

Adopting data transparency initiatives is essential in an era of declining customer trust. It can reap the following rewards:

Global data privacy regulatory landscape.

The global data privacy landscape in 2025 is complex. Two distinct but opposite trends—harmonization and fragmentation—are present.

The European Union's General Data Protection Regulation (GDPR) continues to serve as a benchmark, influencing the development of privacy legislation worldwide. This can be seen through the growing number of countries implementing comprehensive national data privacy laws – these are now in effect in 144 countries. Many nations are amending existing laws or introducing new ones incorporating GDPR-like principles.

However, alongside this move towards GDPR-inspired standards, regional variations and specific regulatory focuses create a more fragmented compliance environment. The emergence of AI has spurred specific legislative action, including the EU AI Act. This regulation introduces tiered requirements based on AI risk levels, including rules around prohibited practices and data transparency requirements.

An increasing number of nations are pushing for data sovereignty and localization laws, mandating that citizens' personal information be stored and processed within their geographic borders. This complicates data flow for global organizations.

The push for harmonization based on GDPR principles suggests a need for globally consistent privacy policies and practices. However, the rise of data localization mandates and region-specific laws requires tailored, locally compliant execution.

As there is still no comprehensive federal privacy law in the United States, businesses face a complex and fragmented regulatory landscape shaped by a growing patchwork of state-level legislation.

Data transparency best practices.

There’s no denying that data transparency is essential. Implementing it at scale can be challenging. Before embracing best practices for data transparency, it’s helpful to know who collects customer data in your business.

This usually includes:

You need departments to work together to figure out how to balance data transparency with personalized customer journeys effectively.

Follow these best practice tips to embrace data transparency at every phase of the customer journey:

Be open about the data you collect and how it’s used.

Don’t try to hide the fact that you collect customer data. Informing visitors about the types of information you collect and how it’s used can build trust. At a minimum, this means you should add a privacy disclosure to your website and feature it in a prominent place. Many websites also add pop-ups for this, but you need to ensure this doesn’t negatively impact the user experience.

For example, you might display opt-out language in your email templates or create a preference center where customers can sign up for the types of communications they receive. You can also display a quick message that tells customers you know their location when you ask them to turn on location services in a mobile app.

You don’t want to scare people away, though, so highlight the benefits of sharing their data. Offering discounts, services, products, or content can encourage consumers to share their information.

Transparency is the antidote to declining customer trust. Your business needs to be honest about how it collects, processes, stores, and destroys consumer data.

Implement a data governance process.

Data governance is essential – you must have clear policies, defined roles and adequate technologies that ensure customer data is handled accurately, ethically and securely.

Consistency across your organization is key to remaining ethical and compliant. You must establish standards for quality, security and privacy. Customer data must be protected from unauthorized access and used according to regulations.

Implement mechanisms for data stewardship to ensure customer data is managed responsibly as well as consistently – this may involve regular audits. Data management practices should also foster accountability.

Don’t gather more than you need.

Key data points can help you create personalized experiences more quickly, but you don’t need to know everything about your audience. Data is a precious resource, but it can also become a liability.

Only track essential information for data personalization. Less data also means cheaper storage costs, which makes customer data management easier at scale.

Make sure data transparency is ongoing.

You should be transparent throughout the entire customer journey. This includes:

Data transparency is the practice of using data intentionally and honestly, while letting customers know about its collection, use, storage, and protection.

Key operational elements include:

Implement security measures.

Strong security measures must underpin your customer data management practices to protect customer data from unauthorized access, breaches, and misuse. You may decide to utilize:

Using data responsibly for enhanced customer experience (CX).

80% are more likely to purchase from brands that deliver on personalization, meaning customers expect hyper-personalized messages. Artificial intelligence (AI) is rapidly becoming indispensable for delivering these hyper-personalized experiences.

AI technologies enable businesses to move beyond basic segmentation towards anticipating customer needs in real time.

This could include:

Personalization is developing to include real-time context, like current location, time of day, weather, or even local trends, to deliver relevant content and offers. Providing a personalized experience across all channels demands sophisticated data integration and activation capabilities.

This move towards omnichannel experiences increases the complexity of customer data management. It highlights the need to break down data silos and integrate data from email campaigns, website apps and point-of-sale systems to create a single customer view. However, with this integration comes the responsibility to ensure consistent privacy rules and data management.

However, utilizing AI has its own set of data privacy considerations. A Cisco study revealed that nearly half of respondents reported inputting non-public information into GenAI tools, suggesting a potentially underestimated risk vector.

The ease of access and clear productivity benefits could tempt employees to input sensitive company or customer data without considering privacy implications. Addressing this requires clear organizational policies, comprehensive training on the safe use of AI tools, and potentially the implementation of technical controls.

Strategies for privacy-centric personalization.

There’s a fine line in balancing the customer demand for personalization alongside privacy concerns. Key approaches include:

Build trust and create personalized customer journeys with Adobe.

Being transparent about how you collect and use customer data helps build trust with customers and can improve the quality of the data you collect.

When you’re ready to get started, review the data you’re currently gathering to determine if you’re collecting the information you need to send your customers the right offers at the right time. You can also ensure you’re not collecting too much irrelevant data that slows down your marketing efforts.

Data transparency doesn’t have to be difficult. Solutions like Adobe Journey Optimizer help you turn data into personalized experiences for your customers, allowing you to share the right offers across the entire customer journey.

Technology enables organizations to manage data responsibly, comply with regulations, and meet customer expectations. Integrated platforms and specialized tools are essential to a modern, trustworthy data infrastructure.

Learn more about how Adobe Journey Optimizer can help you deliver personalized experiences that adapt to customer behavior in real-time.

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