How do we protect consumer rights in the digital age?

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Editor's note: Aaron Zou is a Ph.D. student based in California, specializing in media and cultural studies. The article reflects the author's views, and not necessarily those of CGTN.

Established in 1983 by Consumers International, World Consumer Rights Day takes place on March 15 each year and is designated to raising awareness of consumer rights protection by rallying in solidarity with the international consumer movement.

Consumer International, the world federation of consumer groups, has an extensive network of member organizations in 120 countries. Members commemorate World Consumer Rights Day by promoting fundamental consumer rights and protesting against market abuses and social injustices that undermine them.

As we move into the digital era, new opportunities and problems emerge for businesses and consumers alike.

How digital technologies empower consumers

The affordance of digital technologies and the growing popularity of e-commerce have provided at once tremendous opportunities for consumer empowerment, but also challenges to consumer rights protection.

The internet has largely expanded consumers' access to products and services across the world, as well as to information and resources that facilitate their consumer decisions.

Constant feedback loops between consumers and their devices or apps enable companies to observe, anticipate, address and adapt to consumers' needs swiftly and predictively; they also allow the producers and service providers to frequently update their products and services to satisfy the consumer's evolving needs.

Online shopping and mobile payment have made purchases convenient and instantaneous. The emerging uses of novel technologies such as AR and VR in retailing will potentially enhance online shopping experiences.

Goods sit on shelving ready for shipping in the e-commerce distribution center operated by Alibaba Group Holding Ltd. in Domodedovo, Russia, February. 4, 2019. /VCG Photo

Moreover, social media could also be used to expose business wrongdoings and give visibility to cases of consumer rights violation.

Challenges to consumer rights protection in the digital era

However, at the same time, consumer activities in the digital age are besieged by growing problems related to the complexity, opacity, and uncertainty around the use of personal data, as well as misleading, unethical or fraudulent commercial practices. What are the challenges consumer rights protection is facing in the digital age?

On the one hand, pre-existing challenges to and violations of consumer rights may be exacerbated in the digital age due to ill-conceived or illegal use of digital technologies by unethical businesses.

On the other hand, new problems have surfaced with the development of commercial tracking and targeting, the Internet of Things and other affordances of digital technologies. Below are a few challenges that consumers may encounter in the digital age.

The collection and use of personal data. In the digital age, consumers leave behind data exhausts or digital footprints after every online transaction. These include a range of personal data that as a whole assemble a consumer's online profile.

Personal data are often used to provide personalized advertising or product recommendations. However, there is still a considerable degree of opacity, uncertainty, and complexity around the use of personal data.

Smart devices, wearables, and home appliances enable businesses to track users' activity in their private spaces, collecting all kinds of data. Once stored online, the data exists permanently and can be used for other purposes. In case businesses leak such data, consumers risk becoming victims of crimes such as privacy infringement and identity theft.

A woman in Beijing shops online on the e-commerce platform Taobao, February 5, 2008. /VCG Photo

Moreover, personalization may be used to categorize consumers, consequently leading to their unfair treatment, with specific demographics assigned a higher commercial value than others.

Network security. As it is increasingly comfortable to make purchases online via mobile payment, protection of online payment mechanisms is vital. A breach in the system may lead to not only to unauthorized use of personal data but also financial loss.

Phishing, scams, and frauds that target online accounts have mushroomed recently. These fraudulent activities often exploit novel technologies for illegal ends.

Deception and liability issues. E-commerce transactions often occur through third-party platforms that serve as intermediaries between the consumer and the vendor. The entry barriers for new market entrants in the sector of e-commerce is relatively low and free to enter and exit compared with many traditional marketplaces.

As a result, it may be harder to prevent or track down fraudulent activities that often exploit the structural designs of the platforms, such as their anonymity, for deception.

When frauds occur, deceptive businesses may flee the platform, which leads to liability issues: Who should be liable for the consumers' loss if the platforms appear as a neutral and indifferent intermediary that delegates the responsibility to irresponsible businesses?

Lack of sponsorship disclosure. The rise of native advertising, product placement, and influencer marketing have led to the explosive growth of sponsored content that seamlessly blends in with editorial content or seemingly neutral information.

There is often a lack of clear disclosure as to whether or not such content is paid or by whom. This lack of disclosure blurs the line between advertising and information, between genuine reviews and marketing gimmicks, corroding consumers' ability to make informed purchasing decisions about purchases.

Measures to protect consumer rights in the digital age

Considering the numerous challenges above, how can we protect consumer rights in the digital age? Consumer organizations, media, and regulators can all play significant roles, and here are a few suggestions to consider.

E-commerce, shopping online. /VCG Photo

Data privacy should be prioritized and protected. Corporations that collect and use vast amounts of personal data should strive to improve their privacy policies, and try to make them more comprehensible and visible to the users, particularly in regards to what personal data are collected, used, and in what ways.

Consumer organizations, as well as regulatory bodies, can help to keep tabs on corporate handling of data privacy and report on the implications of corporate privacy policies.

Moreover, the media, both traditional and digital-only outlets, could play an influential role in exposing unethical or illegal business practices. CCTV's 315 Gala is a prominent case in point.

Consumer organizations, journalists and regulatory bodies can collaborate to share information, recommend good practices and expose business wrongdoings to alert the public to stay away from unruly actors in the market.

E-commerce platforms should devote their efforts to identify and combat unethical or illegal businesses activities and to ensure the security of payment mechanisms while taking the initiative to protect consumer rights.

Besides, there should be more clarity in the disclosure of sponsored content to ensure that the consumers are not misled when they are making purchasing decisions.

In addition, higher transparency is needed for personalization algorithms to make sure that consumers not only know about and consent to the use of their personal data, but also have fair access to the information about products and services.

To conclude, the advancement of digital technologies brings about both opportunities and challenges to consumers, who are at once greatly empowered by digital technologies and vulnerable to pre-existing or emerging risks.

Nonetheless, there are many measures to which we may resort to curtail the risks and amplify the benefits brought about by novel technologies.

(If you want to contribute and have specific expertise, please contact us at opinions@cgtn.com.)