07 Apr Winning customers, safeguarding data

Andreas Hassellöf, CEO of Ombori, takes a closer look at why excellent identity management is essential to keep ahead of the loyalty game.

Did you know that in 2023, businesses on average lost approximately AE$11m to cyberattacks, according to the UAE Retail Report 2024 from Adyen? With Saudi Arabia’s e-commerce sector experiencing a 17.47% growth and the UAE’s market projected to surpass AE$48.8bn by 2028, the urgency to protect data is more critical than ever.

Both the UAE and the KSA are spearheading digital transformation under Vision 2030, aiming to diversify their economics beyond oil and gas. Abu Dhabi has launched MGX, a $100bn AI-focused investment fund, while Saudi Arabia’s Project Transcendence, matches with another $100bn initiative, prioritising AI-driven infrastructure like data centres and startups. While these advancements are revolutionising industries, greater connectivity also means greater concerns.

Why data protection is essential for customer loyalty

Earlier this year, a leading UAE- based retailer, faced a data breach allegedly exposing the personal information of around 196,000 customers. Such incidents can significantly damage brand trust and credibility, which are often difficult to rebuild.

To address these risks, the UAE and Saudi Arabia have enacted comprehensive data protection laws. Saudi Arabia’s Personal Data Protection Law (PDPL) was fully enforced in September 2024, and regulates the use of personal data both within the Kingdom and abroad. Violations can result in fines of up to AE$1.34m, doubling for repeat offenses. Similarly, the UAE’s Federal Personal Data Protection Law (No. 45 of 2021) mandates organisations to secure personal data, obtain processing consent and offer mechanisms for correction or restriction.

Boosting customer experience through secure identity management

PwC’s Digital Trust Insights 2024 – Middle East findings revealed that 45% of businesses in the Middle East have revealed that mitigating cyber risks remains a top priority. However, equally important is the need to streamline experiences and transactions, which not only accelerates processes but also delivers a more personalised and efficient customer experience. Today’s customers expect more than just secure transactions; they demand seamless shopping interactions tailored to their unique preferences, including product choice, browsing habits and purchasing history.

Building loyalty through data protection

Now that the importance of data protection is clear, how can brands effectively implement it within their operations?

1. Communicate Clearly: Brands should prioritise transparency by clearly explaining how customer data is collected, stored and used. Providing straightforward privacy policies and regular updates builds trust and reassures customers about their data’s safety.
2. Offer Opt-in Choices: Empower customers by offering opt-in options for data collection and usage, ensuring they have control over their personal information. This not only complies with privacy regulations but also fosters a sense of autonomy and trust among users.
3. Educate Customers: Educating customers about data protection practices helps them understand the value of secure transactions and their role in maintaining safety, while also demonstrating the brand’s commitment to safeguarding their data. This can be achieved through informative content, such as tutorials, FAQs, or campaigns.
4. Invest in Secure Technology: Brands should invest in advanced technologies like encryption, biometric authentication and secure cloud solutions to safeguard customer data. Regular system updates and audits ensure robust protection against evolving cyber threats.

The average cost of data breaches in the Middle East is US$8.75m, according to Statista. By prioritising data protection and identity management, businesses can not only avoid these high costs and fines but also make it easier for both employees and customers to securely access services. Brands that effectively implement these systems are more efficient, credible and gain a competitive edge in a crowded marketplace.

Overcoming the challenges of implementing identity management

Implementing robust identity management systems is not without its challenges. Businesses may face high initial costs, technical complexities and resistance from employees who are accustomed to old processes. These obstacles can make it difficult to adopt such systems, but there are solutions that can be easily executed to overcome them.

1. Invest in Scalable Technology: As the business grows, this ensures that the identity management system can expand to meet increasing demands without accumulating major additional costs.
2. Prioritising staff training: This is a crucial step, as it helps employees understand the importance of secure access systems and how to use them effectively, which can minimise resistance and ensure smooth adoption.
3. Partnering with Experts: Partnering with specialists in identity management can provide the necessary guidance and technical support to navigate complex implementations, making the process more efficient and less daunting. This collaboration ensures that companies can manage data protection confidently while maintaining compliance with privacy standards.

What’s in store for the future?

Looking ahead, there will be more AI-powered identity management tools, a stronger focus on real-time data protection, and a greater emphasis on privacy as consumers seek more control over their personal data. These changes encourage businesses to go beyond just following local laws and aim to set new benchmarks for secure operations and transparency. Moving from simply complying with regulations, businesses can turn identity management into a competitive advantage. This means making privacy a central focus and positioning themselves as leaders in shaping the future of digital security and trust.